Health insurance, by definition, is supposed to protect patients against financial risk so that they can access medical care. However, burgeoning data highlights that in the US, health insurance and insurance bills are some of the biggest barriers to medical care.

According to a recent survey from the Kaiser Family Foundation (KFF), almost 60 percent of insured adults in the US experienced health insurance problems such as denied claims, provider network issues, healthcare provider scarcity, pre-authorization problems and more. About 40 percent of those surveyed said they had delayed or gone without care in the last year because of the expense. The result? Patients are being forced to delay treatment – or skip it altogether. This reality paints a dire picture of the U.S. healthcare landscape. However, there is a promising alternative emerging: cash-pay care.

What is cash-pay medical care?

The cash-pay medical care model is a novel approach to healthcare that bypasses traditional insurance networks.

With traditional care, American patients are not considered the “customer" of the medical system; instead, payors (like insurers and the government) are. Those payors interfere with decisions that should stay between a provider and their patient. As spotlighted by KFF’s survey, it’s increasingly common for insurers to deny coverage for recommended procedures or medications, limit appointments or fail to offer sufficient provider options - all without ever interacting with the patient.

With cash-pay care, patients pay a cash fee directly to the healthcare professional for a range of medical services. The sole incentive of the physician is to provide an affordable, high-quality service so that the patient is happy and cared for - after all, if the patient feels they are unsatisfied with their care, the cash-pay model allows them to simply choose to see a different provider instead. The result of this model is a more affordable, transparent and personalized healthcare experience.

How is cash-pay medical care more affordable than traditional care?

Cash-pay medical care presents an enticing solution to many of the problems presented by traditional health care. With traditional healthcare, you pay a monthly premium to your insurer every month. When you see a healthcare provider through your insurance, your insurer adds administrative costs to your medical bill, builds in complex and distorted jargon and then returns a small portion of your premium back to you, framed as “coverage”.

By eliminating the “middleman” (i.e., insurance companies), cash-pay care makes healthcare more affordable - you pay only for the service provided by your physician, instead of paying for admin costs, processing fees and other third-party price mark-ups. And without insurance companies to answer to financially, the sole focus of the provider is keeping the patient healthy and satisfied.

Cash-pay marketplaces like Sesame also give consumers the ability to compare providers based upon a number of factors, such as reviews from other patients, provider availability and upfront appointment pricing. These dynamics ensure that pricing is competitive, services are high-quality, and availability is plentiful.

How does cash-pay care impact physician-patient relationships?

The cash-pay care model promotes a stronger doctor-patient relationship, creating a personalized care experience that incentivizes better outcomes. Why? Traditional healthcare is built on a fee-for-service model, where doctors and hospitals are paid by insurance companies for each test and treatment they provide. This system incentivizes quantity over quality, as healthcare providers are encouraged to see as many patients as possible to maximize their income. This often leads to shorter visits, as doctors try to keep their schedules moving swiftly.

On the other hand, the cash-pay care model allows clinicians (not insurance companies) to be in control of their schedules and prices, which benefits patients by proxy. On cash-pay marketplaces like Sesame, for example, healthcare providers can set their own appointment availability - they can mark themselves as available for patients all day, open up a few slots on a weekend or simply close their schedule if they don’t have the bandwidth to take on more patients. It is up to the physician alone to decide their schedule.

Additionally, some cash-pay medical care options enable providers to offer virtual care, which facilitates lower costs for patients. Providers may choose to work from home instead of incurring the operating costs of running an office, insurance processing, paperwork and more. And on marketplaces like Sesame, providers have access to additional clinical tools and resources that streamline prescribing medication, writing excuse notes and other time-consuming efforts. By removing insurance-related paperwork, medical professionals also have more time to dedicate to their patients.

All of these functions lead to stress reduction and increased lifestyle flexibility for providers, which in turn benefits patients - it is in everyone’s best interest to have a physician or nurse practitioner who is rested, happy and solely concerned with the patient’s well-being.

I have health insurance - why would I pay cash for medical care?

While it may seem counter-intuitive to pay in cash for medical care if you have health insurance, there are actually a number of instances where it may make more sense. For example, those on high-deductible plans must pay a large amount of money out of pocket before insurance kicks in to cover their medical expenses. If you're nearing the end of the deductible year and need to see a doctor, shopping around for a cash-pay appointment could be a financially savvy decision since it's unlikely that you'll have medical needs that cost more than $5,000 before the deductible year ends.

Cash-pay care options also come in handy if you need prompt medical attention but are unable to find in-network care in a timely manner. This has become a pressing issue in recent years as primary care provider availability dwindles due to physician burnout, post-pandemic patient demand backlog and other factors. If you urgently need a prescription refilled or need immediate care for a UTI and cannot find an in-network provider quickly, it may make more sense to shop around for a cash-pay appointment rather than seeking care from an out-of-network provider and then arguing with your health insurer to cover the visit.

This concept also applies to those who are traveling or on vacation - if you forget your medication, get food poisoning or develop an ear infection while swimming, finding a virtual or in-person cash-pay healthcare professional who’s licensed to provide care in the state you’re in may help you to avoid a battle with your insurance over an out-of-state emergency room visit.

Whether you're seeking immediate, same-day care or simply looking for a more economical option, the advantages of cash-pay medical care can extend beyond those without insurance and benefit anyone who is seeking a fast, affordable doctor's appointment.

Is the cash-pay model a real alternative to the traditional health care model?

Health insurance is still very important for major risks like accidents, hospitalizations and major diseases like cancer. But for a broad range of outpatient care needs, cash-pay medical care solutions like Sesame can help save money, even compared to insurance-negotiated prices.

The cash-pay medical care model is a promising solution to the alarming data about health insurance coverage complications presented by KFF, especially as deductibles and premiums increase. Under this model, doctors are incentivized to spend sufficient time with each patient, cultivating a relationship based on trust and ongoing dialogue. Patients feel valued and listened to, leading to increased patient satisfaction and improved adherence to medical advice.

Moreover, the fee-for-service model prevalent in traditional healthcare often incentivizes doctors to see as many patients as possible, sometimes at the expense of quality care. Conversely, the cash-pay model incentivizes quality care over quantity, fostering a healthcare system that truly values patient outcomes above all else.

No one should be forced to delay or outright forego medical treatment due to the prohibitive cost of healthcare, and the direct-to-patient care model offers a lifeline. By facilitating more affordable and personalized care, cash-pay models like Sesame hold the potential to reshape our healthcare system into one that truly values and incentivizes patient outcomes and satisfaction. It's time to rethink our approach to healthcare and embrace solutions that place the patient at the center of care.

Sesame content is not intended to be a substitute for professional medical advice, diagnosis or treatment. If you have a medical concern, it is critical to seek the advice of your physician or another qualified health provider with any questions. If you are facing a medical emergency, call 911 or visit the nearest emergency room immediately.

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