With over $4 billion spent on healthcare in the United States each year, this cornerstone industry is undoubtedly essential to the American economy. However, for all its successes, the U.S. healthcare system remains one of the most criticized in the world. While healthcare providers strive to improve the patient experience, the prices and burdens of medical bills also increase.
Fortunately, various economic trends continue to reshape the healthcare payment system. However, many Americans remain unaware of these trends. They wonder, “What are the economic trends of the healthcare payment system?”
Understanding the economic trends of the American healthcare system is crucial for both consumers and providers. Healthcare providers might also benefit from medical billing and coding services offered by PracticeForces to help facilitate their business.
From Volume to Value
One major shift in the healthcare payment system stems from how providers bill services. Traditionally, doctors would bill patients for each service they provided. This billing strategy, known as fee-for-service (FFS), focuses on volume, sometimes sacrificing value or incentivizing unnecessary care.
With greater cost transparency and increased competition, there has been a solid rate of decline experienced by doctors who still charge this way. Now, costs depend more on a service’s value rather than the amount.
Higher Deductibles and Copays Yielding Higher Cost-Sensitivity
One of the critical questions in healthcare always wonders who will pay. If you ask, “What are the economic trends of the healthcare payment system,” then you can’t ignore insurance’s role.
While many young people believe insurance automatically pays for their treatment, they ignore the patient component. Most healthcare requires copays and deductibles—the amount the patient pays before their insurance begins contributing. Higher copay and deductible costs increase patient price sensitivity and force providers to be more price competitive.
Online Payment Portals and Expense Management
These days, healthcare providers utilize digital payment options more than ever before. A digitized system, however, allows consumers to manage their expenses better. Payment portals also contribute to price sensitivity.
Increased Price Transparency
In 2021, the Hospital Price Transparency rule took effect, mandating that hospitals and doctors provide lists of their services and associated costs. This rule allows patients to project the cost of their care better but also impacts price trends.
Price transparency makes consumers more aware but also more demanding. Since they can now compare prices from various providers, hospitals and doctors must work harder to offer higher quality care at lower prices.
Telemedicine became one of the most prevalent healthcare trends during and after the pandemic. Telemedicine provides a service that can more easily adjust to consumer price sensitivity since it’s cheap and convenient for patients and providers.
Retail medicine provides increased access to care for all patients. Many patients can avoid expensive healthcare services with over-the-counter meds.
Get Help With Your Medical Billing From PracticeForces
For more answers to the question “what are the economic trends of the healthcare payment system” and to learn how boosting practice revenues with AI can revolutionize your business, call (727) 499-0351 and work with PracticeForces today.