Unexpected medical bills, and the psychology of delaying payment
Why are consumers delaying the payment of medical bills?
It’s happened to all of us… an unpredicted trip to the hospital for emergency care. What’s more unpredictable is the ensuing barrage of mail from your insurance company and medical providers. It can take weeks for your insurance company and medical providers to haggle over who owes what. All while you anxiously await the final amount detailing your patient responsibility or out-of-pocket costs.
When the final medical bill arrives, do you put on your green visor and start the audit process? It feels like you’ve been duped, should you investigate? Do you think, how did they come up with these numbers? Where are the charge items? Why is the insurance not covering these expenses? I don’t remember receiving that treatment!
If you’re like me, I’m overwhelmed with emotion when I receive the medical bill, I simply postpone paying. It took them this long to send the bill, they can wait until I’ve had time to sort it out and come to mental grip with the financial outlay. I think – “I just don’t have the time or money for this right now.”
Delay of medical pay
More than half of Americans (56%) delay paying their medical bills. In 2019, a research study published in the Journal of General Internal Medicine concluded that 137.1 million Americans had experienced a medical hardship in the previous year. High out-of-pocket expenses can lead to mental distress, financial ruin, and cause patients to forgo future care.
Even for individuals and families lucky enough to have an employer sponsored health plan, patients get stuck with high out-of-pocket costs because they are enrolled in a high deductible plan. High deductible plans are specially designed to shift more costs onto the patient, and these plans are becoming increasingly more popular. According to the CDC, the percentage enrolled in a high deductible health plan (either with or without an HSA) increased from 14.8% in 2007 to 43.4% in 2017.
The percentage of patients who delay paying a medical bill will only increase due the growing shift to high deductible plans and the broader economic conditions as a result of coronavirus. However, some reasons for delay might not be so clear.
Why do consumer delay?
There are many reasons that could lead to delaying medical bill payment. Of course, the most obvious and stressful is simply not having the money. The coronavirus pandemic has caused millions of Americans to lose their job and health insurance. Health affordability will continue to be a major factor in why patients delay payment.
Other contributing factors for delaying a medical payment:
- Lack of incentives and reward structures. Think about all the consumer rewards and point systems used to drive consumer purchases. These incentives do not exist in healthcare.
- Absence of transparent pricing before medical services are rendered. The question, “How much will this cost?”, is a loaded question. Front office personnel are simply not equipped to provide a straightforward answer, which involves tabulating costs net of insurance.
- Multiple medical bills across a single episode of care. Delaying payment until all medical providers of the bills have arrived.
- Marginal consequences for payment delay. Although never paying a medical debt can lead to a ding on your credit score and the pursuit of collection agencies, delaying payment a month, two months, or even three months can be inconsequential.
How are medical provider easing the pain?
This reality is causing medical providers to incentivize patients with payment plans and discounts in order to collect money sooner. You can take advantage of these payment options.
Next time your medical bill comes in the mail, first check if your medical provider offers cash-back when you pay your medical bill using Cashback Medical. Cashback Medical works with providers to negotiate discounts on your medical bill.
If your provider is not participating with Cashback Medical, there is still hope if you want an incentive to pay your bill on time. Find the 1-800 contact number listed on the medical bill, dial it up, and when you speak with a patient financial representative, tell them Cashback Medical sent you and ask for a 25% “lump sum” discount.