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How Medical Credit Checks Can Inform Payment Conversations and Decisions

Credit checks

Earning and maintaining patient trust is imperative for healthcare providers. It can be influenced by their clinical care and other touch points, including interactions at registration and during billing processes. As interest and expectations of price transparency grow, the need to readily disclose costs associated with care does too.

Having conversations around cost can help determine the best payment approaches. Below are some questions to consider when developing payment strategies and educating patients on the benefits of medical credit checks.

Why is it important to engage patients in conversations around costs?

Patients want to be able to anticipate and plan for their medical expenses to make more informed decisions on care and payment options. Per a TransUnion Healthcare survey, nearly half (49%) of respondents noted how knowing upfront costs impacts their decision to use a healthcare provider. Given patients shoulder more of the cost burden due to high coinsurance and deductible plans, there’s an opportunity for providers to engage and educate them on the details of their financial responsibility. This engagement can lead to more active participation.

How are the benefits of a medical credit check?

As part of an upfront financial assistance application, verifying patient income may require a credit check. Providers use this information to determine how to best meet the unique financial needs of patients. With a better view of a patient’s financial picture, providers are able to check eligibility for Medicaid, charitable assistance and payment plans — and offer a more personalized payment plan based on ability to pay.

For patients, this can mean better price transparency on their coverage, out-of-pocket costs and payment options available — helping lead to a more positive billing and overall experience. This credit check may come as a surprise to patients, so it’s important to iterate it’s considered a “soft hit” and won’t impact their credit score. It’s also worth noting it’s only visible to the consumer and credit bureau.

How does credit data help assess a financial situation?

Providers want to ensure they differentiate a patient’s willingness and/or ability to pay a bill. Using a credit report can help assess a patient’s financial situation, including income levels, charity qualifications and capacity to pay. Credit data helps with decisions — unrelated to providing medical care — such as when to:

  • Apply charity discounts
  • Enroll in financial assistance
  • Write off a balance
  • Try to collect with in-house resources
  • Leverage a collection agency for overdue balances

It can also inform objective determinations for charity. Within a process governed by automated decision logic with identified business rules, this data can help identify those who may qualify for charitable discounts or other financial assistance. This rule-based process is very important for compliance efforts, especially in regard to 501(r) regulations.

A medical credit check can also help ensure a provider’s debt portfolio accurately classifies charitable claims, which is imperative for non-for-profit organizations. Properly ascertaining charity determinations helps with compliance efforts, ensures patients are categorized into the correct payment classification based on a legitimate need, and assists with compliance of 501(r) IRS regulations.

For more information

A positive payment experience is created when providers have insights into financial data and patients are engaged early in the payment process. For more information on patient engagement and financing, and how a more informed patient can help reduce costs to collect, visit:

If you’re a consumer with questions or issues related to your personal credit report, drivers history report, disputes, fraud, identity theft, credit report freeze or credit monitoring services, please visit our Customer Support Center for assistance.

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