ROI Hospitals Can’t Ignore: Payment Modernization
By Saurabh Joshi | Published: 2025-11-03 14:46:00 | Source: MedCity News
Health care providers do some of the most important and complex work in our society. But the systems that support them, especially around payments, often lag behind.
PYMNTS Intelligence reports that 42% of providers still rely on paper checks – A method that is almost unheard of in other industries or countries. It is not a reflection of health care priorities, but rather the weight of aging infrastructure that makes change difficult.
The good news is that modernizing payments offers one of the clearest paths to achieving relief. Manual drive systems create friction with every step. Errors creep in during processing, settlements are delayed, records are lost and risks increase. Modernizing these processes can unlock savings and give hospitals the stability needed to focus resources where they matter most: patient care.
with Medicaid and Medicare cuts from the “Big Beautiful Bill” (OBBBA) With this looming large, health systems can no longer afford to ignore this issue – and miss out on the financial flexibility afforded by modern payment infrastructure.
When decision makers look for savings, payment modernization provides the fastest return on investment compared to other operational changes. The benefits are tangible and immediate: faster cash flow, lower settlement costs, fewer disputes, and clearer reporting to understand financial needs in real time.
These quick wins are crucial for hospitals, but there’s another reason why modern payments are key to long-term resilience: patient loyalty. Patients often bear the brunt of legacy systems, facing delays and uncertainty that may prompt them to seek care elsewhere.
The patient’s pain points
I recently experienced how much damage this friction can do.
After a doctor’s appointment, my billing address was incorrectly captured. A month passed, then two months, without any word from the provider. I had no idea what the balance was due, how much insurance covered it, or when I was expected to pay the rest.
For all I know, the claim may not have been processed yet. Then, out of the blue, a collection agency called to tell me I had an unpaid bill. I spent hours on the phone trying to resolve the issue and protect my credit.
Stories like this are all too common, and since healthcare providers operate like businesses that need to win over customers, an unsatisfied patient will result in lost revenue. According to a poll conducted by American Express. 24% of US healthcare consumers We will consider switching providers if they do not offer the consumer’s preferred payment method. This impacts the hospital’s bottom line and continuity of care for the patient.
Modern payment systems replace confusion with clarity, enabling hospitals to turn a recurring source of friction into an opportunity to increase patient satisfaction.
Digital payment portals provide patients with real-time notifications as claims are processed. They can see what their insurance covers and know instantly what they owe. Stored credentials and seamless “Pay Now” features make it easy to pay with one click instead of waiting for paperwork.
When patients have access to clear documentation, cost estimates, and up-to-date payment options, they feel more in control of their care. Meeting these expectations is not just about keeping up with consumer trends. It’s about providing safe and convenient solutions that build trust. Trust translates into loyalty, and loyalty translates into stable revenue.
Inertia of inaction: The hidden cost of doing nothing
Switching to modern payment solutions often encounters resistance. Healthcare leaders are concerned about fraud, compliance, cost and disruption – all legitimate concerns. However, this mindset creates an inertia that health systems can no longer tolerate if they want to protect their margins in the current climate.
I hear it all the time from CEOs: “Most of my concerns are making sure the hospital is running — there are enough nurses, doctors arrive on time, we have enough syringes, all liabilities are covered, etc. I’m sorting through hundreds of literal life-or-death priorities. Well, our payment technology may not be the best, but why fix it if it’s working so well?”
The reality is that payments don’t work well. They were backed by expensive solutions. Hospitals are forced to double down on manual processes, add staff, and accept revenue leakage as a cost of doing business.
Manual systems create hidden costs across customer service, accounting, and finance. I’ve spoken with hospitals that hired 15 people in their call center just to follow up on overdue bills. They had 20 other people in accounting to reconcile what was sent to collections and what was uncollectible. An entire team is dedicated to analyzing payment failures and manual interventions. However, a significant portion of the potential revenue was being sold to collection agencies for pennies on the dollar.
With the right automation, none of this overhead will be needed. Hospitals will not need entire departments chasing unpaid bills or correcting broken processes. Alternatively, these teams can be redeployed to higher-value work – such as supporting patients with white gloves or proactively solving problems to deliver better care.
It’s a mess, but it doesn’t have to be. The major players who have already adopted digital payments have proven what is possible. Those who are still hesitant just need to be strategic about how they approach modernization.
Updating made simple
Mid-sized hospitals, in particular, often feel they lack the resources to modernize their payment system. They fear that the technology will be too complex and disruptive to current processes. But with the right partner, implementation is much simpler than most leaders assume.
First, don’t get distracted by flashy demos and buzzwords, especially when it comes to AI. Nearly 70% of vendors will talk about AI, another 25% know little, and only about 5% have the real knowledge to implement it for the right reasons and use cases. Locating a partner in that 5% is much more important than moving quickly with a vendor who can’t deliver on their promises.
Look for a technology partner who has custom healthcare payment solutions, understands the nuances of your business and can guide the process from start to finish. The right partner offers the domain-specific expertise, proven tools, and security investments required to protect patient data.
With APIs and touchpoints already established for integration with insurers, providers, and electronic health records, implementation can be completed quickly and transparently. Health systems can finish integrations in weeks — or even days — not years.
However, don’t try to tackle everything at once. Start with your biggest pain points and solve them with simple, proven processes. Quick wins build confidence and momentum, making it easier to scale modernization across the organization.
Progress that pays off
Modern payments provide transparency, speed, and security across the entire healthcare system. Providers see faster revenue, patients gain clarity and control, and payers benefit from clearer, more reliable data.
For health systems facing OBBBA-driven cuts, modernizing payments is the most logical place to start building resilience. It’s a proven way to protect margins without sacrificing care.
In 2025, there is no reason to still have to make health care payments through paper checks and manual processes. It’s time to move beyond inertia and move forward.
Photo: Warchi, Getty Images
Saurabh Joshi He is the boss CSG Fortewhere he drives strategic vision, product innovation and growth across the payments ecosystem. He has more than 20 years of global leadership experience at Western Union, Better Mortgage, PayPal, Rocket Internet, and Goldman Sachs, in North America, South America, and Asia. Before joining CSG in 2024, he led payments, P&L, revenue operations and product strategy broadly. Saurabh holds an MBA from the Wharton School, along with advanced degrees in finance and computer science. His leadership blends deep technical acumen with a passion for simplifying payments, forecasting consumer trends, and building agile teams that put the customer first.
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