Unless you’ve been living under a rock for the last few years, you’re well aware by now that our healthcare system is drastically changing and that initiatives, like moving to across-the-board electronic medical records (EMRs), were pushed for years prior in the stimulus bill. It’s been well documented how much the US spends on healthcare: $2.7 trillion a year, if you’re keeping score, which is equal to about $8,233/person.
That’s a lot of money. A lot of money that flows through all types of different payment channels. Just think about how many different methods and ways YOU spend $8,000 in a year. 
The Complexities of Healthcare Payments
About a fifth of our healthcare spending comes from Medicare, which pretty much has payments down to a science (paperwork aside). Much of the rest is a fragmented and inefficient system of manual, paper-based processes for payments, non-payments, FSAs, HSAs, write-offs, overcharges, discounts, and so on. Just consider how a routine doctor visit is billed and paid for:
You visit your local physician because you’re sick. These days, when you arrive at their office, you owe a co-pay before anyone will see you. Due to your condition, the doctor ends up writing you a prescription for an antibiotic. On your way out, you stop by the billing station to pick-up your bill, which has a handful of fields (out of a page full of them) marked based on the services you’ve received. Off you go, bill and prescription in-hand, en route to the pharmacy. Meanwhile, the doctor’s office submits that bill to your insurance company, who will receive discounted prices over what an uninsured individual would get. Now at the pharmacy, you owe another payment for your prescription (the pharmacy submits any remaining balance to your insurance provider if you have Rx coverage). Sometime in the future you may receive an additional bill from you insurance company because a service or test performed at the doctor’s office was not covered by your policy. Bam, another payment. These payments are in addition to the premiums you already pay for basic coverage.
So, an average doctor’s visit isn’t so average. Lots of payments, lots of paperwork, and lots of room for error. The process has become so ingrained in us, that we don’t think about why a practice that’s so ubiquitous isn’t easier to use, and why more technology isn’t being embraced (or demanded). The bottom line is this: the deployment of payment automation processes, technology enablers, and payment analytics are key to improving our overall healthcare system’s efficiency, as well as the health of its participants.
In the coming weeks, I’ll explore areas where healthcare can learn from financial services innovation and vice versa. There are a lot of commonalities between the two industries, namely that both are heavily regulated and highly ubiqitous. Most important though, they’re both en route to a newer, better end-state that’s either a moving target, or hasn’t quite been defined.
