Payments consumers make to health care providers will soar by more than 40% over the next three years, creating a glut of opportunities for direct-billing service vendors, according to a new Aite Group report.
Patient-to-provider payments will reach $381 billion by the end of 2014 from $270 billion in 2010, with competition centering on speed, customer service and convenience as payments move to electronic platforms such as the Web, the report suggests.
“Health-insurance providers large and small are usually averse to changes in their back-end administrative platforms,” wrote Kunal Pandya, senior analyst with Aite Group and author of the report. “Biller-direct vendors that demonstrate early strengths in the patient-to-provider payments market space will have more opportunities to create stickiness with their clients and should benefit in the long term.”
Vendors looking for a slice of the growing market will be competing based on quality of customer service, speed to market, functionality, and the ability to deliver easily customizable services, the study predicts. They also will compete based on their ability to encourage clients to adopt high-tech services such as interactive voice response and Web payments, the study found.
Aite based the report on the results of a survey it conducted during last year’s fourth quarter and the first quarter of this year of five prominent U.S. patient-to-provider payments technology vendors, including Alacriti Inc.; Aliaswire Inc.; BillingTree Inc.; Fidelity National Information Services Inc., or FIS, and Online Resources. Of those, BillingTree and FIS have the highest product-penetration rates with 42% and 36% respectively, according to Aite.
The survey found that vendors ranked reselling through financial institutions as the most important distribution channel for their business strategy and being able to capture maximum market reach in the patient-to-provider payments segments.
Seventy-five percent of the health care providers in the U.S. market are considered small to midsize and will be key to driving growth in the evolving market, according to the report. Aite Group predicts the successful vendors will be those that are best able to reach these providers.
