A new study shows that household and business spending on healthcare costs will close in on the $3 trillion mark in the next decade. One Triangle company is hoping to alleviate some of the associated frustration, at least when it comes to billing.
According to a study published by Health Affairs, a peer-reviewed medical journal, healthcare costs that will be paid by households and businesses will increase to nearly $3 trillion by 2025. The founder of PatientPay, a Durham-based paperless billing company that specializes in the healthcare field believes his company can streamline the process by making bills easier for individuals to read, understand, and pay in a much shorter period of time.
Tom Furr founded PatientPay following a personal – and frustrating – experience at an area healthcare provider several years ago, when his wife was treated for a broken ankle. The seemingly indecipherable bill he received led to a phone call, which only led to more frustration.
“There were four numbers: what you owe, what’s due now, what’s past due, and what’s covered by benefits,” Furr explained. “But when I looked at my explanation of benefits, there was only one number that popped up.”
So, out of necessity, Furr created a way to streamline the process for the provider, which also benefits the patient. PatientPay’s software allows the company to align a patient’s bill with the patient’s explanation of benefits provided by his or her insurer. This way, when a customer gets the bill, the numbers match and the experience is much smoother and more manageable, Furr said.
“Those type of experiences are going on more now with Affordable Care Act pushing higher deductible plans,” Furr said. “So many people out there have no idea how this work, why it works this way. It needs to be fixed.”
Michael Trilli, a healthcare industry analyst, said patients often do not know what they actually owe when reading a bill.
"Now there is an accountability part on their end to take time to understand it, but what I am referring to is many times it is very hard, because a patient receives an explanation of benefits statement from their health plan and a statement from the provider. And they don't say the same thing," Trilli said. "Many times, the patient cannot understand because it is in a language they do not understand," Trilli said. "PatientPay addresses this very efficiently for the hospital or healthcare provider yet offers an equally compelling story for the patient."
According to the Health Affairs’ report, health spending increases in the U.S. from 2015 to 2025 are expected to average 5.8 percent, which is actually more than 1 percentage point faster than the expected growth of the nation’s GDP.
“As the initial impacts associated with the Affordable Care Act’s coverage expansions fade, growth in health spending is expected to be influenced by changes in economic growth, faster growth in medical prices, and population aging," the report states. "Projected national health spending growth, though faster than observed in the recent history, is slower than in the two decades before the recent Great Recession, in part because of trends such as increasing cost sharing in private health insurance plans and various Medicare payment update provisions. In addition, the share of total health expenditures paid for by federal, state, and local governments is projected to increase to 47 percent by 2025."
While traditional industry estimates suggest a healthcare provider issues three to seven paper statements before they get paid, “north of 75 percent of people pay (their bills) within 14 days,” Furr said of customers who use PatientPay.
“It’s time for the typical online experience be brought to healthcare: to make sure it matches, to give you an easy way to pay. Our bill matches up to explanations of benefits line by line,” Furr said.
Even for patients who have had a great experience with their healthcare providers, “the bill has ruined the whole experience,” Furr said.
Trilli agreed, and said a customer's most recent experience is the one he or she will remember.
"Healthcare has many of its own unique quirks like any industry," Trilli said. "But, at the end of the day one thing is universal, the last experience is the most lasting experience. And with these higher-deductible plans, consumers have more to gain in choice and more to lose given the money they have to pay. I think more hospitals and providers are recognizing this."