Why Medical Bills Are So Frightening and How to Fix This

francine hardaway
Feb 12 · 4 min read
Image courtesy of RexPay

Medical debt is the #1 cause of bankruptcy in the US (Harvard, 2015). You know it yourself. The research is all out there.The political candidates know it. And the health care industry knows it.

Providers lose billions of dollars a year ($38BN in 2016,ACA Report) in defaulted patient payments. 2/3 of bills $500 or less were not paid off in 2017 and 17% of Americans have past-due healthcare bills on their credit reports.

So why does this continue to happen and is there any way to change it?

Well, it’s complicated. Let’s leave out the uninsured, who simply cannot afford the exorbitant costs of today’s medical care. Of the many people who actually ARE insured, many still don’t pay.

Part of it is the sheer complexity of the bill. When you open the mail, you often see an Explanation of Benefits (EOB). This, in theory, tells you what the doctor charged, what insurance paid, and what you are still responsible for.

But the EOB says very clearly that it’s not a bill, and 54% of millennial parents have never seen a medical bill before they have a baby. When they have the baby, the last thing they have energy to do is figure out complicated bills. Over half of these patients delay payments simply because they forget to pay, are confused by the bill, or aren’t sure how to pay it. So 74% of millennials delay their bill payments. They throw the bills in a drawer.

56% of patients of all ages delay payments because they forget to pay, are confused by the bill, aren’t sure how to pay, or think they can’t afford it.

The only way to solve this problem that the medical industry is not truly incentivized to solve is patient by patient.

Rachel’s Accident

My friend Rachel, who is a very smart woman, had an accident in 2016. On top of the physical pain she went through, she also experienced medical bill mayhem and suffered through an avalanche of bills.

She found herself dealing with 38 medical bills from 11 different providers, and spent hours tracking her bills and payment methods manually on a spreadsheet. How many of you would do this? Not many. The drawer is a quicker receptacle than a spreadsheet.

But Rachel’s experience inspired her to improve the patient payment process, and this is how RexPay was born.

RexPay is a mobile app that helps patients to understand, manage, and pay all their medical bills in one place.

Why didn’t anyone else think of this? Patient downloads the RexPay app for free. Patient easily sets up a profile within a couple minutes. During this process the app allows the patient to take a picture of their insurance card(s) and any payment methods they would like to use for their bills.

If their providers are already integrated with RexPay, the bills come directly to the app. If it’s a non-integrated provider, the patient takes a picture of the bill they received, or uploads the information by means of importing file or manually adding the information.

The app alerts the user if the document they uploaded is an EOB or even a duplicate bill, in which case the patient may not owe the amount.

Questions about bills in general may be answered by the RexPay chatbot. The patient may also add bill tags and notes in order to keep all of their records organized in the app.If the app & patient both verify that the bill accurately reflects the amount owed, the patient selects the desired payment method, and pays the bill through the app.

What’s Missing From This Picture?

Mass adoption.

Although RexPay can be downloaded from both app stores, but so far only Athena Health has adopted it from the provider side. This is where I insert that phrase “Ask your doctor if RexPay is right for you.” This is what’s known as demand creation. If you want your medical bill payments to be less of a hassle and more of a convenience, help RexPay, a startup, to get the word out.

Am I a Shill?

And no, I don’t work for them and have no financial interest in them. I merely think that, after advising another company that tried to do this ten years ago and was defeated by the industry, this time it is time.

francine hardaway

Written by

Co-founder, Stealthmode Partners, helping entrepreneurs succeed

Stealthmode Blog

Francine Hardaway’s Blog About Entrepreneurship, Technology, and Life

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