Patient collections vs. payer collections: the real cost gap.

Health systems have spent decades optimizing for Medicare, Medicaid, and commercial contracts. The patient balance is now big enough to matter just as much — and it behaves nothing like the payers your revenue cycle was built for.

Every health system finance leader can recite their payer mix from memory: Medicare, Medicaid, commercial, self-pay. It’s a useful shorthand, but it’s increasingly out of date. A patient carrying a $12,000 deductible on a bronze marketplace plan shows up in your dashboard as “well-insured.” In practice, she’s paying out of pocket for nearly everything until a catastrophic event kicks in — which makes her, functionally, a self-pay account your systems haven’t been built to recognize.

This isn’t a rounding error. It’s a structural shift, and the data behind it should reset how executive teams think about both collections and consumer strategy.

What is patient cost-sharing responsibility?

Patient cost-sharing responsibility is the portion of a medical bill a patient owes directly — through deductibles, copays, and coinsurance — after any insurance payment is applied. As high-deductible health plans have become the norm rather than the exception, this category has grown from a minor line item into a revenue stream large enough to move a health system’s margin on its own.

The math no other payer relationship would survive

High-deductible health plans covered roughly 2% of Americans in 2005. By 2023, they covered a majority of the privately insured. Over that same stretch, what patients pay out of pocket has grown faster than overall medical cost trend — meaning patients have absorbed a disproportionate share of the cost growth the whole industry complains about.

The result is a payer relationship that would get renegotiated overnight if it belonged to an insurer instead of a patient, according to Hospitalogy:

• Health systems spend 25–30 cents to collect a patient dollar, compared to 4–5 cents for a commercial dollar.
• Health systems collect roughly 95–97% of what commercial payers owe, but typically only 30–50% of what patients owe.
• In 2025, patient cost-sharing responsibility climbed to 7.3% of net revenue, while the share actually collected fell to 42.4%.

Owed more. Collected less. And it’s about to get harder.

The debt is already piling up

This isn’t a hypothetical future risk — it’s already visible in how American households are managing (or failing to manage) medical bills today. Nationally, an estimated 100 million adults carry some form of medical or dental debt, totaling more than $220 billion, per the Peterson-KFF Health System Tracker. In one widely cited KFF survey, roughly 41% of adults reported having debt tied to medical or dental bills. That burden doesn’t stay contained to the patient side of the ledger — it shows up in your health system’s bad debt, write-offs, and collections costs.

The next 18 months make this worse, not better

Recent healthcare finance reporting from Hospitalogy points to a sharp acceleration heading into 2026 and 2027:

• Average marketplace deductibles jumped 37% in a single year, to roughly $3,786 in 2026, as enrollees shifted into leaner bronze plans.
• The Congressional Budget Office projects the uninsured population will grow from 1.3 million in 2026 to 5.2 million in 2027, driven by Medicaid work requirements and more frequent redeterminations.
• Combined, these shifts are projected to strip roughly $68.5 billion from hospital revenue across 2026–2027, with uncompensated care rising nearly 39%, to $44.9 billion.

For a health system already operating on a thin margin, that’s not a line item. It’s the difference between investing in growth and managing a downgrade.

It’s not that patients won’t pay

The instinct in a lot of finance and revenue cycle conversations is to treat this as a collections problem — better scoring, better outreach, more aggressive follow-up. But the data tells a different story. One Hospitalogy analysis of patient billing behavior found that accounts with high “propensity-to-pay” scores actually collected 51% less than accounts with no score at all. Traditional credit-based scoring, built on zip codes and credit history, simply isn’t measuring the thing that actually predicts payment. The same analysis found that roughly 77% of patient bills require some form of specialized, non-standard follow-up — only about a quarter are the simple, easy-to-collect balances that one-size-fits-all billing was designed for.

What predicts nonpayment far more reliably than a credit score is confusion: a bill that doesn’t match what the patient expected, arriving through a channel and on a timeline that assumes every patient’s situation looks the same. Most patients want to pay for the care they received. What stops them is not knowing, ahead of time, what it will cost.

That’s a pricing and communication problem — not a collections problem. And it’s solvable further upstream than most collections strategies ever reach.

Patients are ready to shop. Most health systems aren’t ready for them to.

The demand side of this equation backs that up. According to McKinsey research, 89% of consumers say they’re interested in shopping around for at least one category of care, and as many as 73% of commercial claims spend is for services that are shoppable to some degree — meaning the price can reasonably be known in advance. Separate research from HFMA found that 40% of consumers already say out-of-pocket cost is a major factor in deciding where to get care. And in public polling, an overwhelming 91% of Americans say hospitals and healthcare facilities should be required to disclose the cost of their services.

The catch: most patients still haven’t acted on that appetite. One industry survey found that 64% of patients have never shopped around for care by comparing prices — largely because the information hasn’t been made easy to find or compare. That gap between demand and access is exactly where health systems have an opening.

Regulators are pushing in the same direction. Starting in 2026, CMS is requiring hospitals to publish actual dollar prices — not ranges or estimates — for a wide set of shoppable services, with additional statistical detail on negotiated rates. The compliance bar is rising regardless of what any individual health system chooses to do next; the only real choice left is whether to treat that requirement as a minimum standard or a foundation for something patients can actually use.

Why “shoppable” is a financial strategy, not a consumer buzzword

Shoppable care means a patient can see the full, bundled, all-in price of a procedure before choosing where and how to receive it — the same way they’d compare a flight or a hotel room on a platform like MDsave. Building that visibility into the front end of the care journey, rather than explaining pricing after the fact, changes what happens next:

• Fewer billing surprises. A price patients agreed to upfront isn’t a shock three weeks later — it’s a plan they already understood.
• Faster, more predictable payment. Upfront, transparent pricing collected before or at the point of service converts uncertain post-care collections into predictable pre-care revenue.
• A better competitive position. As more patients shop for care the way they shop for everything else — comparing price and quality side by side — health systems that make that comparison easy win volume from those that don’t.

This is the thinking behind Tendo Marketplace: a platform built around what we call the Three C’s of Value — Convenience (care that’s as easy to access and purchase as any other consumer decision), Clinical Quality (procedure- and provider-level quality information, so price is never compared in a vacuum), and Cost (transparent, all-in bundled pricing, set before care begins, not reconstructed afterward).

The window to act is now, not in 2027

The pressure building on patient financial experience isn’t a future risk — it’s already showing up in payer mix, in bad debt, and in patient satisfaction scores. Health systems that wait for the collections problem to become unmanageable will be solving it from a position of weakness. Health systems that get ahead of it — by making cost and quality visible before care happens, not after — will be the ones patients choose, and the ones that get paid for the care they deliver.

FAQ

What is shoppable healthcare pricing? Shoppable healthcare pricing means a patient can see the full, all-in cost of a procedure — including facility, physician, and other fees — before care happens. Instead of a bundle of separate bills arriving after the fact, the patient sees one upfront price they can compare across providers.

Why are patient collections harder than payer collections? Health systems typically collect 95–97% of what commercial payers owe, but only 30–50% of what patients owe directly. Patient balances are smaller, more fragmented, and more sensitive to confusion about what’s owed and when — all of which drive up collection costs and write-offs.

How does price transparency affect hospital revenue cycle performance? When patients know the cost of care before receiving it, they’re more likely to pay predictably and on time. This shifts revenue collection earlier in the care journey — before or at the point of service — rather than relying on post-care billing and follow-up.

What is driving the increase in patient financial responsibility? The shift toward high-deductible health plans is the primary driver. HDHPs covered about 2% of Americans in 2005 and now cover a majority of the privately insured, shifting a growing share of the cost of care directly onto patients.

What are the new CMS price transparency requirements for 2026? Starting in 2026, CMS requires hospitals to publish actual dollar prices — not estimated ranges — for a defined set of shoppable services, along with additional statistical detail on negotiated rates with payers.

Learn more about how shoppable, transparent pricing can help protect your margin as patient cost-sharing keeps growing — and connect with the Tendo team to see what it could look like across your highest-volume specialties.