Healthcare providers perform some of the most important and complex jobs in our society. But the systems that support them, especially in payments, often lag behind.
PYMNTS Intelligence reports that 42% of providers still rely on paper checks — an approach that is virtually unheard of in other industries or countries. This is not a reflection of healthcare priorities, but rather the weight of legacy infrastructure that makes change difficult.
The good news is that payments modernization offers one of the clearest paths to relief. Manual payment systems create friction at every step. Errors arise during processing, reconciliations are delayed, records are lost, and risks increase. Modernizing these processes creates cost savings and allows hospitals to steadily focus resources where they matter most: patient care.
With cuts to Medicaid and Medicare looming from the Big Beauty Bill (OBBBA), health systems can no longer ignore this issue or miss out on the financial resiliency provided by a modern payment infrastructure.
When decision makers look for savings, payments modernization provides the fastest ROI compared to other operational changes. The benefits are tangible and immediate: faster cash flow, lower reconciliation costs, fewer disputes and clearer reporting for real-time visibility into financial needs.
These quick gains are critical for hospitals, but modern payments are critical to long-term resilience for another reason: patient loyalty. Patients often bear the brunt of outdated systems, facing delays and uncertainty that can force them to seek care elsewhere.
Patient pain points
I recently experienced firsthand how destructive this friction can be.
After making a doctor's appointment, my billing address was incorrectly captured. A month has passed, two months have passed, and still no word from the supplier. I have no idea how much I owe, how much is covered by insurance, or when I will pay the remainder.
As far as I know, the claim may not have been processed yet. Then, out of the blue, a debt collection agency called me and told 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 as healthcare providers operate more like businesses that need to win customers, unsatisfied patients will result in lost revenue. According to an American Express survey, 24% of U.S. healthcare consumers would consider switching providers if the provider did not offer the consumer's preferred payment method. This affects hospital profits and continuity of patient care.
Modern payment systems replace confusion with clarity, allowing hospitals to turn frequent sources of friction into opportunities to improve patient satisfaction.
The digital payment portal provides real-time notifications to patients when claims are being processed. They can see what is covered and know immediately what they are owed. Stored credentials and seamless Pay Now functionality make it easy to pay with just one click, without waiting for paperwork.
Patients feel more in control of their care when they have access to clear documentation, cost estimates and modern payment options. Meeting these expectations is more than just keeping up with consumer trends. This is to provide secure and convenient solutions to build trust. Trust translates into loyalty, which translates into income stability.
Inertia of inaction: the hidden costs of inaction
The transition to modern payment solutions is often met with resistance. Healthcare leaders worry about fraud, compliance, cost and disruption—all valid concerns. However, this mindset has created an inertia that health systems can no longer afford if they want to protect their profits in the current climate.
I often hear executives say something like this: “My biggest concern is making sure the hospital is running — there are enough nurses, doctors show up on time, we have enough syringes, accountability is covered, etc. I’m sorting through hundreds of life-and-death priorities. OK, our payment technology may not be the best, but if it’s working well, why fix it?”
The reality is, payment methods don't go smoothly. They were supported by expensive solutions. Hospitals have been forced to double down on manual processes, add staff, and accept lost revenue as a cost of doing business.
Manual systems create hidden costs in customer service, accounting, and finance. I've spoken to hospitals who hired 15 people in their call center just to follow up on overdue bills. They have another 20 accounting staff to reconcile what has been collected and what cannot be collected. An entire team is dedicated to analyzing payment failures and manual intervention. Still, a large portion of the potential revenue is sold to debt collection agencies at very low prices.
With the right automation, this overhead is unnecessary. Hospitals don’t need entire departments to track down unpaid bills or repair broken processes. Instead, these teams can be redeployed to higher-value work—such as white-glove patient support or proactive problem solving to provide better care.
It's a mess, but it doesn't have to be. The major players that have adopted digital payments have proven what is possible. Those who are still undecided just need to be strategic about how they modernize.
Modernization made simple
Midsize hospitals, in particular, often feel they lack the resources to update their payment systems. They worry the technology will be too complex and disrupt current operations. But with the right partner, implementation is much simpler than most leaders imagine.
First, don’t be distracted by flashy presentations and buzzwords, especially when it comes to artificial intelligence. About 70% of vendors talk about AI, another 25% know a little bit about it, and only about 5% have the real knowledge to implement AI for the right reasons and use cases. Identifying those 5% of partners is far more important than working quickly with a vendor that can't deliver on their promises.
Find a technology partner with custom healthcare payment solutions who understands the nuances of your business and can guide the process from start to finish. The right partner can bring the domain-specific expertise, proven tools and security investments needed to protect patient data.
Implementation can be completed quickly and transparently with APIs and connection points already built to integrate with insurance companies, providers and EHRs. Health systems can be integrated in weeks or even days, not years.
That being said, don’t try to solve every problem at once. Start with your biggest pain points and solve them with a simple and proven process. Quick success builds confidence and momentum, making it easier to scale modernization across your organization.
Progress brings rewards
Modern payments bring transparency, speed, and security to the entire healthcare ecosystem. Providers see faster revenue, patients gain clarity and control, and payers benefit from cleaner, more reliable data.
For health systems facing OBBBA-driven cuts, payment modernization is the most logical place to start building resilience. It's a proven way to protect profits without sacrificing care.
In 2025, there is no reason why healthcare payment will still be based on paper checks and manual processes. It’s time to get over the inertia and move on.
Image: Warchi, Getty Images
Saurabh Joshi is President of CSG Forte, responsible for driving 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, spanning North and South America and Asia. Prior to joining CSG in 2024, he was responsible for large-scale payments P&L, revenue operations and product strategy. Saurabh holds an MBA from the Wharton School and advanced degrees in finance and computer science. His leadership blends deep technical acumen with a passion for simplifying payments, anticipating consumer trends, and building resilient, customer-focused teams.
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