As a minimum, payment technology should create a path of least resistance for the consumer, as difficulty in settling an outstanding bill means organizations risk missing out on prompt payments. The consumer must be able to move freely between the payment channels they choose – just because a consumer receives an outstanding bill through the mail doesn't mean they want to reply the same way. It may be more convenient to pay online or contact the agency by phone to pay the bill or negotiate a payment plan.
The 2017 Collection Agency Operations and Technology Survey showed businesses agree with this. Technology adoption and offering a variety of payment channels continued to be top priorities. Automated payments, interactive voice response (IVR) and virtual debt negotiation were three of the most popular payment methods, with many agencies realizing the benefits these technologies can bring – including 24/7 payments and streamlining manual, time-consuming processes.
It is these three technologies that will really help collection agencies improve their bottom line, even as industry and consumer demands change in the future.
Automated payments – simple yet effective
An automated payment plan is simple and user-friendly, keeping payments on-time and customers happy.
With automated payment plans through a web portal, a notification is sent electronically to the consumer. When accepted, the notification will automatically trigger a payment which is instantly taken out of the client’s account for each billing cycle. Automated systems like these are affordable, smart and can even integrate with current core systems, meaning agencies of all sizes can quickly reap the rewards.
Automated payments through portals have been helping the healthcare industry improve its revenue cycle management by letting patients receive electronic statements and pay their bills online.
According to Josh Gray, Vice President, athenaResearch, online access translates into financial rewards, "When clients increase portal adoption by 20% or more, they see improvements in patient pay yields of four to eight percent. They get paid more and faster. If you can get a patient on a portal, they're 13% more likely to return. The value of the patient who returns is eight to 20% higher."
A recent healthcare report from athenaResearch cites the Summit Medical Group, a 500-physician group in Berkeley Heights, New Jersey, as an example of one group that now receives 30% of its patient payments via online portals.
Interactive Voice Response – prompt payments, more time for accounts staff
Interactive Voice Response (IVR) technology uses automated call scripts which allow the consumer to pay via touch-tone prompts, helping improve the consumer experience. Providing consumers with a simple automated method to pay a bill, whenever and however they want to, can significantly improve the chances of receiving a payment.
But IVR technology isn't just a great way to improve payment collections and enhance customer service – the technology also frees up time for accounts receivable staff to deal with more critical work that needs their attention.
According to Phil Gray, executive vice president of Interactions, developers of enterprise intelligent assistants, IVR system has helped his company cut down on missed calls by 60% and that the technology has directly led to a 15% increase in revenue per call.
However, there are still challenges for companies looking to adopt IVR systems. An IVR system not designed with the customer in mind has the potential to decrease the likelihood of payment through this method. A quick resolution is what customers are looking for when they are using IVR, and if your automated system fails to meet this expectation, then the chances are the customer will permanently ditch your services and find another way to pay.
Ease of use is another challenge. Customers prefer using systems that require the least effort and time. More complex and time-consuming IVR will turn them off, so having an easy to understand the system with as few steps as possible will help collections rather than hinder them.
Virtual Negotiation – discuss your payment plan in private
If a consumer can’t settle their bill in full, then it might be time to negotiate. Virtual negotiation technology is enabling consumers to handle this privately, online, and without the discomfort or embarrassment of face-to-face interaction – and again saving employee time.
A three-step process enables the consumer and the accounts receivable department to agree to a payment plan that works for both.
1. The consumer is first notified of a minimum payment amount and maximum payment length.
2. They can then either accept or make a counteroffer of how much they would like to pay back and for how long.
3. The virtual negotiation system will then accept or reject the offer. If rejected, the consumer will receive a further counter offer which they can either accept or reject or re-negotiate the amount or length of time.
Customer demands and an ever-changing business environment make it crucial for collectors to offer an expanded virtual negotiation technology solution for easy access to payment information.
But many technology vendors in today’s collection industry offer systems that are made up of individual products stuck together rather than integrated. The results are inefficient systems that are being forced together, often losing some of the critical functionality of each separate solution. The training process can also be difficult, as managers need to learn how to operate all of the new products.
Instead, collection organizations considering a new technology purchase – or an upgrade of their existing system – should look for a vendor that offers a complete, integrated solution. The solution needs to have the flexibility to meet their changing needs, to grow as they grow and not box them into a limited system – a single, unified platform that eases collection pains.
Technology crucial to better collections
The integration of different payment collection technologies is a top priority for agencies, and technology solution providers will play a critical role in helping the ARM industry remain competitive and profitable in the future.
*Featured image credit: CFPB.