A new report by TransUnion shows the healthcare industry will need to innovate and simplify at the same time for millennials to pay their bills more consistently, and to understand what their health benefits are in the first place.
Transunion's Healthcare Millennial Report found that nearly six in 10 millennials, or 57 percent, had little to no understanding of their health insurance benefits, leaving a seven percent gap between them and the 50 percent of gen Xers who had the same level of knowledge about their benefits, and an even wider gap for the 41 percent of baby boomers who were ill-informed.
The TransUnion Healthcare Millennial Report analyzed a proprietary TransUnion Healthcare data and information from a survey of 1,576 consumers given in October 2017. For this analysis, Millennials are defined as consumers born between the years 1980 and 1994; Gen X are born between 1965 and 1979; and baby boomers are born between 1946 and 1964.
Another key finding was that while most millennials have health insurance, it takes them longer to pay their medical bills than other generations. In 2016, 74 percent of Millennials didn't pay their medical bills in full, compared to 68 percent for gen X and 60 percent for Baby Boomers.
Seven in 10 millennials did say they would pay their medical bills in full if they had the money to do so, the report said. Healthcare providers will need to innovate to make the payment process more manageable for millennials, TransUnion said.
One contributing factor could be the lack of advanced notice on financial obligations and overall transparency. According to the report, 46 percent of millennials would be more likely to pay their medical bills if they were given estimates of their healthcare costs at the point of service.
More education is also needed for millennials when it comes to recent trends in the healthcare industry like high deductible healthcare plans, as 26 percent of millennials said they don't these plans, as opposed to 17 percent of gen Xers and nine percent of baby boomers.
"Healthcare providers looking to improve cash flow from Millennial patients should look for ways to encourage payments at the time of service while offering more educational tools to ensure they better understand the complex healthcare landscape," said John Yount, vice president for healthcare products at TransUnion. "This will not only engage them early, it will protect revenue from leakage, and provide an overall better patient experience."
It may also behoove healthcare providers to educate their millennial patients on the importance of budgeting for healthcare costs. While nearly 40 percent of millennials have private health insurance, more than a third don't budget for health expenses, and roughly half don't feel prepared to manage healthcare expenses. That's compared to 42 percent of Gen-Xers and 33 percent of baby boomers.
Not surprisingly though, one thing millennials are doing more of than baby boomers and gen Xers is comparing costs, something 40 percent of millennials do. Only 29 percent of gen Xers and 22 percent of baby boomers shop around.
What is interesting is that by and large, baby boomers especially have more medical needs and higher bills than millennials who are younger and healthier rack up. It is possible that an educational campaign aimed at baby boomers on the ins and outs of shopping around for medical services could yield a shift in their spending. Gen Xers might do well to start comparing service costs as well. Greater transparency and making costs for services easier to find might also add to the ranks of consumers who shop around for their healthcare, regardless of age.