Fintech: A step to create value for all

Can the rise of FinTech be a gamechanger for the healthcare sector? By Sanjiv Das

With India witnessing a digitisation upsurge, Internet and rise of smartphone users with increasing digital transactions, one can seen a evolving FinTech ecosystem within the country. Moreover, financial services industry are undergoing a consumer-driven transition approach from legacy processes to on-demand accessibility to a variety of non-traditional payment options, banking and asset management options. These trends drive more demand for FinTech services in India.

FinTech is the buzzword in the banking sector and refers to the use of technology across all financial services functions. With FinTech, there has been a rise in traditional financial services and benefits to consumers. Initially deployed at the back-end systems within established financial institutions, banks are increasingly looking to use FinTech across its entire value chain in order to garner the benefits. These services have been able to redefine financial services. According to an E&Y report, the FinTech industry attracted over $13.1 billion in VC-backed investments in 2016.

After the banking sector having evolved to perform strategic and focussed role with the help of FinTech, the healthcare sector also got its share of benefits from fintech. Healthcare, a sector though diversified and full of opportunities, is facing the conundrum of how to deliver meaningful and positive experiences to its customers without raising costs. With out-of-pocket expenses on the rise in healthcare, patients are looking out for better personalised financial planning, ease of making payments in a more convenient manner. Apart from providing better facilities, healthcare providers are scouting for new avenues to make customer relationship better by incorporating technological innovations within their system.

The last few years have witnessed several fintech companies venture into the medical finance space in the country. So how does fintech work in healthcare sector?

Addressing healthcare challenges
In days to come, new financial technologies will help the healthcare sector maintain payments with providers using the capabilities to make electronic bills more accessible. Overall, it will have less impact on the time spent on administrative work and offers a path to streamline some of those back-office functions and gives healthcare workers more time to focus less on administrative management and organisation and more on the bottom line: delivering high-quality patient care.

Nilesh Jain, MD and Co-founder, Clinivantage HealthCare Technologies says, “As the benefits of innovation and disruption in the financial sector aid benefits to individuals, businesses and institutions, similar expectations of access to information, empowerment, performance, services and personalisation will demand innovative products and services from healthcare providers. We will see more innovative models that will help drive improvements in traditional financial services in healthcare.”

According to Manish Jain, MD and Head, Commercial Banking, India, Standard Chartered Bank, firstly, there are significant developments happening in the payment / collection infrastructure. Secondly, patients also now have multiple options in the form of digital platforms leading to better access to credit and multiple online payment options and creative insurance products from new and emerging players leading to massive multiplication of health coverage to hitherto uncovered population.

Dr Rajendra Patankar, COO, Nanavati Super Specialty Hospital says, “We are on the cusp of great digital transformation and FinTech, which combines technologies with financial instruments, solutions and services, is all set to disrupt the Indian healthcare sector. We are witnessing a new healthcare economy fully driven by a digital transformation. It is true that FinTech companies offer huge support in addressing the healthcare challenges in the country. The leveraging of data to make decisions and guide the underwriting process brings down the risk of defaults on loans. Moreo

ver, in the case of a medical loan, the amount is credited directly to the hospital’s bank account, thus eliminating the possibility of the misuse of funds.”

Shalabh Paliwal, Chief Financial Officer, Jaslok Hospital and Research Centre comments, “Not only customers but also healthcare organisation is searching alternatives of the financial services which can help them in accessing widespread customers. There are many apps these days which not only help customers in selecting appropriate health insurance suitable to their requirement but also paying for the same online and reducing lead time and efforts drastically.”

Fintech is helping to build an integrated and sustainable healthcare ecosystem in India. According to Ashish Gupta- CEO, Docprime.com and Tech Evangelist- Policybazaar.com, the end goal is to empower customers and decrease medical cost burden.

Gupta further adds, “FinTech is undoubtedly shaping the face of the Indian healthcare industry. Some of the fintech-driven changes that can be witnessed in the healthcare industry are better engagement with customers, price or treatment cost transparency, management of unplanned medical expenses, better claim settlement experience, convenience in terms of better clinical care, digital payments and customised medical loans etc.”

Improve operational and cost efficiencies
Healthcare providers are shifting to value-based models and in order to remain profitable and sustainable, focussing their delivery models on patient outcomes. While improving patient experience, providers should provide better care at low cost. Not only customers, but also healthcare organisations aresearching alternatives which can help them in accessing widespread customers. So, what goals should the healthcare providers set to make the system more conducive both for them and their customers apart from improving the operational and cost efficiencies, while selecting financial services?

According to Jain from Clinivantage HealthCare Technologies, successful healthcare providers must align their goals with the requirements of payment models. He further says, “There is a need for risk adjustment tools to help the organisation understand and increase or decrease its risk profile appropriately. Resource allocation and utilisation reporting should be at the point of care. Providers will need a good sense of how they are spending money as they take on increasing risk. Financial system should allow management of profitability; more importantly, should facilitate collaboration between the finance and quality improvement teams by helping identify the specific, actionable clinical initiatives that would have the most impact on profits and performance on improved patient outcomes.”

“FinTechs have helped not only in handling collections and payments but also in managing downstream processes like reconciliation. Healthcare sector partnering with banks and fintechs for digital solutions will overall result in improvement of operational efficiency and reduction of cost,” informs Jain from Standard Chartered Bank.

Says Dr Patankar from Nanavati Super Specialty Hospital, “Amid an ongoing digital revolution in India’s healthcare system, FinTech companies integrate transparency, discovery and financing that help patients in comparing prices of surgeries, quality of hospitals and doctors and pay in EMIs.” Paliwal says, “There are many apps these days which not only help customers select appropriate heal

th insurance suitable to their requirements, but also to pay for the same online and reduce lead time and efforts drastically.”

Says Gupta, “The FinTech technology is the backbone of our company. With the help of this technology, we have built an integrated appointment management system for all our partners. This allows us to effectively manage patient appointments on our partners’ behalf and makes it easy for us to keep a track record of partner payments and on time direct payments.”

Financial stability for healthcare organisation
The need of the hour for healthcare providers is financial stability and it can be achieved only when there is an ease of doing business. Apart from streamlining billing and payment systems while improving cash flow, providers can work to reduce costs to patients and improve the quality of care through technology advancements and disruptive approaches.

Dr Patankar elaborates, “Availability of digital financial products are great enabler. By creating a sustainable ecosystem, the ultimate aim of the industry would be to ensure a significant impact on the country’s gross domestic product (GDP). FinTech brings ease of payment for the consumer, it empowers the consumer and changes the way healthcare institutions interacts with their consumers. Increase in usage of FinTech services has positive impact leading to debility in prices paid by the consumer and cashback has been a main attraction.”

Healthcare sector partnering with banks and FinTechs for digital solutions will overall result in improvement of operational efficiency and reduction of cost. Says Jain from Standard Chartered Bank, “Healthcare providers see banking and fintech arrangements as a vital element in providing enhanced patient experience. FinTechs have helped not only in handling collections and payments but also in managing downstream processes like reconciliation.”

Gupta says, “Healthcare providers can leverage the data in a more systematic and efficient way to guide the underwriting process. This can help in minimising the default on loans.”

Impact on healthcare providers
There has been easy accessibility of electronic bills due advanced financial systems built in collaboration with hospitals, insurance companies and other service providers, which has helped improve data quality leading to greater personal empowerment.

Says Jain from Clinivantage HealthCare Technologies, “E-payments can create greater transparency, rich data on use and cost of healthcare services, and generate reporting efficiencies.” He adds, “FinTech also improves the efficiency of the healthcare staff. Instead of using outdated IT systems, engaging in endless paper filing or eternal phone calls, fintech can help streamline back-office functions, giving healthcare workers more time to focus on delivering high-quality patient care. The trend is moving toward customers owning their own data. Hence, capitalising on financial technology could connect hospitals with patients on a personal level and generate insights to better assess the value of care.”

With 24/7 easily accessible data in hand, customers are now relieved. This has also lead to insurance companies using the same data to understand their customer’s more. FinTech has made healthcare and insurance more affordable as inefficiencies in the system have drastically reduced.

Future trends
FinTech 2.0 will deliver fundamental changes to the infrastructure and processes at the core of the financial services along with the healthcare industry. Dr Patankar says, “FinTech 2.0 would now pick up the baton and focus on the next 500 million of the population. We foresee many patient-centric solutions coming in that will completely transform the healthcare delivery systems solutions. The biggest assets will be created of robust database with the provider’s / healthcare institutions that can be a game changer for the healthcare delivery system.”

According to him, FinTech 2.0 would cover segments across urban and rural areas narrowing on Tier I and Tier II cities. In order to create a cost-effective and sustainable ecosystem to serve the untapped segments, a few interventions are proposed. Considering the lifestyle and eating habits of the people, there are many lifestyle diseases which affect our life. FinTech can be leveraged to cater to the need of preventive care enabling people to not only plan their medical expenses but also keep a check on their health.

Replace unplanned medical savings
Patients can reduce out-of-pocket expenditures, medical poverty traps, and unplanned medical savings with strategic fintech-enabled healthcare solutions. Technology in healthcare finance can be leveraged to create patient-centric solutions which can help save and plan for medical expenses in advance.

Jain from Clinivantage HealthCare Technologies says, “A strong fintech platform will bring easier access to healthcare. Technologies need to be better linked and integrated with each other. FinTech solutions focussed on healthcare can help manage out-of-pocket expenditures. Technology in healthcare finance can create patient-centric ‘savings plan’ solutions to plan for their emergency medical expenses.”

Study conducted by various industry bodies indicate that only 10 per cent of the population in India are medically insured. A lot of financial bodies provide loans to families who are financially fragile.

Says Dr Patankar, “FinTech-enabled health solutions can empower people with financial back up with innovative pay back solutions. The need for creating a feasible healthcare financing model acts as the catalyst which has triggered the medical loans, which are unsecured. FinTech-based solutions will be a turning-point for the category.”

“There has been a rise in cost of surgeries and post operation expenses are also huge. In the absence of medical insurance, when people generally opt for surgeries, on financial front they are open to a bigger risk. There are startups which offer saving plan for such non-emergency medical services where patient can save money on a everyday-basis,” says Paliwal.

Leveraging the benefits of FinTech?
By the use of technology in healthcare finance, healthcare institutions would be able to reach the smaller towns in India while increasing access to medical care and reducing costs. Jain from Clinivantage HealthCare Technologies asserts, “Making health financing more secure and efficient through technology, FinTech delivers the demands while creating more tailored, medical experiences for the end user. With the merging of technology finance and healthcare in India, endless possibilities in the healthcare affordability ecosystem could be achieved.”

FinTech solutions can improvise inefficiencies in supply chains, streamline cross-stakeholder collaboration and solve gaps in identify management. Says Dr Patankar, “FinTech is not just about digitising money but it’s about monetising data. Collation and analysation of data can bring in a new dimension to the patient data and physician behaviours. This will help healthcare institutions learn stakeholder loyalties, engage in meaningful conversations, recognise and resolve issues and much more.”

Paliwal says, “FinTech solution may offer a mid-way where healthcare companies will be able to reach out to customer without spending huge money on promotions. Better patient services can be offered where financials can be managed technologically, and companies can focus more on better patient services thereby improving overall customer satisfaction.”

Says, Jain from Standard Chartered Bank, “Standard Chartered has a complete suite of solutions designed to reduce the high wait time at the time of billing. Our solution on this front is a customised mix of UPI, Cards and IMPS-based collections channels. These are real-time and help in reducing billing time significantly, while at the same time are cost efficient. For the challenge of delayed realisation/application of funds, we offer clients a solution which enables identification of remitter/sender and provides enriched information around each payment received thereby further simplifying the application of funds. We are also working with clients to automate the entire banking process, including the payments process.”

In days to come, FinTech is likely to take the centre stage and revolutionise the way the entire healthcare system works. Strategic tie-ups between hospitals and financial institutions will boost the sustainability of FinTechs, which is indirectly going to boost the medical loan system and build a sustainable ecosystem in healthcare.

Fintech can help resolve the following

• Regulatory frameworks for the integration of FinTech and digital health
• Applications of FinTech, like peer to peer and EMI savings based plans to address growing and complex patient out-of-pocket challenges
• Integration of financial solutions as the source, by integration into solutions, defining strategies at source to advance from idea to execution in deploying disruptive solutions with integrations like ours.
• From the time a case is identified, the financial assistance is required to pilot programmes achieving real-time payment processing via integrated platform services.
• Partnerships and business models for efficient adoption of platform technologies and fintech applications with providers, payers, and patients.
• Mobile payment and mHealth to facilitate ease of access for patients
• Value-based care and approaches that tie together financial and healthcare data
• Smart contracts to streamline cash flow, procurement and improve reliability
• Considerations for FinTech’s utility in the reduction of fraud, waste, and abuse within
  healthcare

Source: Clinivantage HealthCare Technologies

sanjiv.das@expressindia.com