Patient Refunds- A Growing Challenge
Patient refunds are a contemporary issue faced by medical providers because of the dynamic changes in the healthcare industry since 2020 and the pandemic. Widespread and urgent need of care under extreme pressure and in speed created a perfect storm due to the uncertainty of insurance and government support. As uncollected payments for services skyrocketed to over $30B annually, additional headwinds were created by medical debt not being allowed to be reported to credit aggregators. So, the industry had to adjust. One of the ways service providers could counteract this new paradigm was to start requiring some payment in advance of service. With prepayments comes additional accounting and, in many cases, there are overpayments and refunds due back to patients.
A Brewing Patient Refunds Crisis
In 2025 most healthcare service providers are now regularly contending with the obligation of refunding money back to patients. Once bills are invoiced and subsequently paid by the requisite parties, numerous patients end up with a credit balance on account. These refunds must be promptly and accurately paid to the patient. However, most participants in the healthcare ecosystem rely on legacy formats of payment such as checks because they lack the data and systems to modernize these growing payments into a fast digital format.
According to the Healthcare Financial Management Association (HFMA), over 65% of hospitals reported that patient credit balances are a growing administrative burden, with patient refund volumes increasing almost 20% YoY. Most organizations contending with this responsibility are forced to either credit the patient’s original form of payment or send out a paper check. Either method generates unnecessary costs for the organization. Delays in paying patient refunds can lead to patient dissatisfaction, regulatory scrutiny, and even legal exposure. Refunds are required to be issued in a state-specific period of time to avoid financial penalties. As a result, large hospital networks are deploying contemporary payment systems that optimize patient refunds.
Major health systems continue to share with the Dash team that the issued refund check costs their organization more than $20 per unit when they factor in both the hard costs with the custodial escheatment and customer service responsibilities. Additionally, they must deal with the pervasive fraudulent activity associated with the antiquated form factor, with billions in estimated losses every year. Finally, there is universal acknowledgement that while making patient payments is a requirement, it is not an area of expertise for healthcare companies. There is data to support this claim. In 2024, a Medical Group Management Association poll found that 36% of medical practice leaders plan to outsource or automate part of their revenue cycle.
Dash Solutions Offers a Better Way to Pay
Dash Solutions continues to help forward-thinking healthcare organizations contemporize B2C payments by arming them with a modern, proven, and compliant disbursement system. Clients realize transformational benefits once they outsource the patient payout process to Dash. Program sponsors extinguish unnecessary costs, streamline operations, while at the same time optimizing the patient refund experience. Dash Solutions’ modern payments platform, in conjunction with a proven deployment methodology and a veteran team of experts, ensures program success. We seamlessly and conveniently offer every patient demographic their preferred payment modality in a logically designed user experience.
