Even for people with great health benefits, the most painful part of getting healthcare is often paying the bill. That’s because, by nature, healthcare is usually unplanned, creating unexpected and sometimes substantial out-of-pocket costs that disrupt people’s financial plans.
If people don’t have savings, these expenses can go unpaid, damaging the patient’s credit, or the cost may be put on a high-interest credit card, payday loan, or payment plan from the provider’s office. For some who know they don’t have funds available for medical expenses, care remains out of reach, and health conditions worsen without treatment.
Paytient’s founder, Brian Whorley, saw the impact of unfunded care over 15 years as a hospital administrator. He and co-founder Daniel Lynn started Paytient in 2018 to design a healthcare payment solution that empowers consumers to get the care they need. Thus, the Health Payment Account was born. More than four years later, Paytient works with over 700 enterprise partners, including employers like Commerce Bank and R.R. Donnelley, as well as insurance carriers like Cigna and Centene.
In this episode of the Paytient Podcast, we're taking a closer look at Health Payment Accounts with Laura Cave, Paytient's Chief Marketing Officer. We discuss how HPAs work, why they work, and how they complement other benefits. If you've ever wondered whether your organization might be a good fit for an HPA or how they differ from HSAs and FSAs, this is the episode for you!
What is a Health Payment Account?
The Paytient Health Payment Account is an employer-sponsored benefit that consists of an interest-free Paytient Visa card and an app that employees use to pay the out-of-pocket cost of care and split those bills into smaller payments that get automatically deducted from payroll. This is made available to employees without a credit check alongside any health plan or other health benefits like HSAs and FSAs. The employer sets the spending allowance on the card, typically $1,000 to $5,000, that can be spent on the card at one time. For most groups, the card can be used for medical, dental, vision, pharmacy, behavioral health, and even veterinary care.
The advantage of a non-predatory credit solution like an HPA is that it’s a lot less expensive for employers than actually funding HSAs or Lifestyle Accounts with cash. We’re talking $2-4 PEPM to extend an HPA vs. $50-$80 PEPM if you try to give them access to just $1,000 via increased compensation or an HSA account.
Why do Health Payment Accounts work?
Paytient’s Health Payment Accounts have an NPS of 90, which we attribute to a few factors. One of the reasons we think HPAs work so well is that they’re easy. It’s just a VISA card that anyone knows how to use to pay for care. From there, our app is really easy to set up a personalized repayment plan that fits any budget.
Imagine the relief when a $1,000 charge becomes $50 out of your next 20 paychecks. It’s so much more approachable for people, and we hear from them all the time about how grateful they are. Importantly, in a survey last year, 67% of respondents told us they would not have gotten care without the Paytient card.
What kind of care do people get with a Health Payment Account?
People use their Paytient HPA to get care from a wide array of providers. While we can’t see the specific care services they received, we can see the types of providers they’re visiting in our backend.
The dental category has the highest average first swipe of any category. We see a lot of activity within the medical category, from specialist care to physical therapy and chiropractic visits. What is really interesting is that pharmacy is only 15% of first swipes, but it’s 29% of ongoing swipes, which suggests that people are continuing to use their card to get their prescriptions.
To learn more about Paytient’s utilization and what it reveals about the kind of care people get when financial barriers are removed, check out our Health Payments Report.
How do HPAs work with HSAs?
Health Payment Accounts are compatible with HSAs and can even make them more effective. HSAs are designed to help employees save pre-tax dollars for healthcare needs. However, HSA accounts often have low balances or no funds because occasional health expenses drain the money saved every year. With an HPA, employees can protect their HSA balances so they can grow and flight this year’s medical expenses through their paychecks to avoid diminishing HSA balances. They can also use HSA dollars to make a payment towards their Paytient balance if they want to use those tax-advantaged dollars.
Who’s a good fit for Paytient?
We partner with insurance carriers, hospital systems, and employers of all sizes in various industries. Paytient appeals to a wide variety of payers and providers because everyone in the healthcare ecosystem benefits when patients can afford routine care and early treatment that keeps chronic conditions in check and improves mental health.
Employers focused on medical affordability, health equity, retention, and cost containment find a lot of value in Paytient. And due to its low PEPM, we’re able to find creative ways to fund the benefit, from health plan wellness dollars to reallocating HSA or lifestyle account contributions. We also see some employers eliminating less popular benefits to deploy Paytient.