With growing technological advancements, consumers’ options to pay for services have expanded over the last few years. Consumers are no longer restricted to paying with cash or even point of sale (POS) terminals. We’ve seen a revolution of mobile payment apps like Venmo, Apple Pay, PayPal, etc. A physical card is no longer necessary to pay for goods or services.
In our current Affordable Care Act (ACA) marketplace, Softheon supports several payment channels like physical check payments, interactive voice payment (IVR) payments and online payments.
Within the ACA population, consumers are utilizing the digital space to make payments. Most notably, our data shows an increase in demand for automation with a 10% increase in 2018 for subscription payments in healthcare insurance premiums. In the current age of automation, the less customer action required, the higher the retention rate.
What is most interesting is the unexpected increase in paper check payments in our population.
This can be best attributed to either the specific ACA demographics or an increase in premiums sponsored by a third party.
Third party payment programs essentially serve low income members by covering premium costs for members that are unable to afford health care coverage. Based on research conducted by The Commonwealth Fund, an effective third-party payment program has been proven to assist 25% of all eligible marketplace enrollees by providing them access to affordable healthcare. However, they also cited concerns that issuers incurring additional administrative costs to support alternative payment sources for TPP beyond member payments.
Softheon’s initial exposure into this space is through a need to curb unauthorized third party payments as mentioned in a prior blog.
Softheon has expanded our Equity payment processing solution to accept validated payments made by governmental, tribal TPP programs and/or private nonprofit organizations. In partnership with our issuers, we processed over $16 million of TPP which enabled almost 10% of our population to have access to healthcare. From the Commonwealth Fund research, members who received support from TPP programs indicated that they would have otherwise been uninsured without such assistance. We saw a ten-fold increase in “sponsorship” payments between 2017 to 2018 largely attributed to the growth we see in sponsored membership.
One of the pain points that our solution helped solved is the automation of disbursing the TPP into the individual policies without incurring additional administrative and operational costs to our issuers. This prevents disruption in care for the individual members.
For additional information on how our TPP solution can helpsupport your participation in TPP programs and maintain administrative costs, please reach out to Hamoon Hadavand at hhadavand@softheon.com.
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