The road to digital payments in healthcare begins with a few cashless steps, says Bank of America

There are few disciplines outside of healthcare that have more symbolic of both the possibilities of digital technology and the challenges of its implementation.

In an era where digital transformation is cutting across industries, the healthcare sector finds himself struggling with the challenge of modernizing its payment system.

“Historically, [as it relates to payment flows between patients, providers and payors,] Healthcare has not been a leader in technology adoption or implementation, and … as a result, it has been challenging to keep up with the evolving needs and expectations of patients.” Simon Abtalionmanager of healthcare solutions at Bank of Americasaid PYMNTS, noting that the situation is exacerbated by the complex and regulatory landscape of the healthcare industry.

Abtalion explained that this delay has resulted in a fragmented payment ecosystem that struggles to meet patient expectations.

Outside of healthcare, consumers are used to a streamlined experience across all channels where they can interact digitally at every touchpoint. In healthcare, however, such solutions have yet to be fully adopted.

Move to cashless healthcare

The persistence of cash healthcare payments is a problem in the market. Health workers continue to accept cash, driven by the goal of maximize bill collection rates.

This results in many health systems lacking accurate information about the true percentage of payments collected in cash, making it difficult to assess the true value and cost of maintaining cash as a payment option, Abtalion explained.

“Without that amount of data at your fingertips, it’s hard to make that forward-looking leap to cashless because you may fear you’re jeopardizing meaningful collection,” he said, noting that the percentage of money collected is typically lower. but health service bosses think.

However, as patients become familiar with digital payment methods such as digital wallets and near field communication (NFC), the transition to a cashless healthcare system is becoming more feasible. Younger generations, who have grown up with digital payment technology, are driving this change.

Using technology

Despite the clear trend toward digital payments, healthcare providers face several barriers to fully embracing the change. Abtalion emphasized the importance of data in driving decisions and encouraged health systems to evaluate both the costs of third-party couriers and the risk of cash transactions, highlighting the inefficiency of maintaining cash-based payments.

Another factor is managing transitions for all patient demographics. Abtalion explained that health systems serving older populations that have successfully transitioned to cashless models have been aided by clear communication, expectation management and patient financial lobbying.

“When the patient’s expectations are managed and there’s not a knee-jerk reaction to something that comes at them,” he said. “They have time to prepare for the transition to cashless – and are capable of do it.”

“Cashless doesn’t have to be an all or nothing situation,” he added. “You can really benefit as an organization from a reduction in cash.”

This gradual approach helps ease the transition and ensures that no group of patients is left behind.

While the road to a cashless healthcare system is complex, involving both technological advancements and cultural changes, and starting with the reduction of cash, Abtalion noted that the industry is closer to this goal than many might think.

He explained that Bank of America’s acquisition of AxiaMed platform, now known as Healthcare payment solutions (HPS), represents a step toward consolidating and centralizing healthcare payment processes. This dedicated healthcare portal aims to integrate multiple payment solutions into a coherent system, simplification vendor management, reduce data silos and extra overall efficiency.

Abtalion added that the future of healthcare payments is also poised to benefit from new technologies such as blockchain, which can increase transparency and speed in the billing process. He said he envisions a system where blockchain technology facilitates real-time billing, reduces delays and improves price transparency for patients. Such innovations could streamline the patient experience and reduce the friction associated with paying for health care.