How to Improve Patient Payment Collection Rates With Two-Way Texting

Key Takeaways on How to Improve Patient Payment Collection Rates With Two-Way Texting

• Text messages achieve a 98% open rate, and 32% of patients pay within five minutes of receiving one - with 65% paying after the first text alone.

• Two-way texting outperforms one-way broadcasts because it lets patients ask billing questions in real time, addressing confusion - the single biggest barrier to payment - but only works when trained billing staff are available to respond.

• Every payment text should include the patient's name, the specific balance amount, a clickable payment link, and a contact number for questions, sent in a three-to-five message sequence starting after insurance adjudication.

• Trackable short links pointing to mobile-optimized, login-free payment pages turn engagement into revenue - our case study with Auburn Community Hospital achieved a 91% reach rate and 30% unique link click rate across 13,755 messages in 90 days.

• Segmentation and ongoing optimization drive the best results - don't set it and forget it.

Why Are So Many Patient Balances Going Uncollected?

Patient collection rates have dropped to 47.8%, down from 54.8% just two years ago.

That means more than half of what patients owe never makes it back to the provider.

A major driver is the rise of high-deductible health plans, which now cover one-third of all insured workers.

Average deductibles have hit $1,886 for single coverage - a 43% increase over the past decade - putting patients on the hook for more out-of-pocket costs than ever before.

The problem is, most of them don't understand their bills.

70% of patients say they're confused by what they receive, and only 7% can actually define basic insurance terms like deductible, coinsurance, and out-of-pocket maximum.

When people don't understand what they owe or why, they simply don't pay.

The size of the balance makes things worse.

Providers collect about 40% of small balances under $35 at the point of service, but that figure drops to just 6% when the balance exceeds $200.

Traditional outreach isn't solving the problem either. 80% of patients won't pick up calls from unknown numbers, and 82% never listen to voicemails from unfamiliar callers.

Paper statements cost $3-$7 each to produce and mail, and the same bill often gets sent three to seven times before payment arrives.

More than half of patients take over three months to pay through these channels.

What Makes Two-Way Texting Different From Traditional Billing?

The engagement gap between texting and other billing channels is hard to ignore.

Text messages have a 98% open rate and are typically read within three minutes.

Email, for comparison, sits at a 20-30% open rate with a 90-minute average read time.

That visibility translates directly into action.

32% of patients pay their medical bill within five minutes of receiving a text - faster than any other billing channel.

Payment links included in texts see 25 times higher click-through rates than the same links sent through email.

And the first message carries the most weight: 65% of consumers pay after that initial text notification alone.

Speed compounds over the full billing cycle too.

Adding text and email notifications to existing mailed statements cuts average time to payment from 20 days to just 9, compared to the 60-120 days typical of paper-only billing.

The Power of Letting Patients Text You Back

The biggest reason patients don't pay isn't refusal - it's confusion.

When someone doesn't understand a charge or isn't sure whether insurance was applied, the bill gets set aside indefinitely.

Two-way texting gives them a simple way to ask questions right then and there - things like what a charge covers, why an amount looks different than expected, or how to set up a payment plan.

This matters because 57% of patients with medical debt won't answer phone calls from their providers, and 39% avoid opening mail altogether due to anxiety around owing money.

Texting removes that barrier. 42% of people will open and respond to a text from a number they don't even recognize, and 56% of consumers say they're comfortable resolving billing questions through live text chat.

One important caveat: the ability for patients to reply only works if someone is there to respond.

Industry practitioners consistently find that texting without trained billing staff available to handle questions generates more complaints than payments.

The two-way channel isn't just a feature - it's what makes the whole approach work.

How to Structure Your Payment Text Messages for Maximum Results

Every payment text you send should include a few key elements: your practice name, the patient's first name, the specific balance amount, a clickable payment link, a phone number for questions, and opt-out instructions.

Personalization makes a measurable difference.

A peer-reviewed study of 9,196 individuals with unpaid hospital bills found that messages including the recipient's name significantly outperformed generic reminders in driving payments.

For cadence, a structured sequence works best.

Send the first text once the balance is finalized after insurance adjudication - this is your highest-conversion touchpoint.

Follow up with a gentle reminder at 15 days, a firmer notice at 30 days, and a final courtesy message at 45-60 days before escalating to phone or mail.

Three to five texts total is the sweet spot before switching channels.

Timing matters too. The strongest response windows are mid-morning (9-11 AM), lunch (12-1 PM), and late afternoon (3-5 PM), Tuesday through Thursday.

Keep messages under 160 characters when possible and stick to plain, direct language.

Smart Links Turn Clicks Into Collections

Shortened, trackable URLs do more than save space in your messages - they give you real visibility into what's working and who's engaging.

The page your link points to needs to be mobile-optimized and require no portal login, no app download, and no account creation.

Guest checkout should be the default experience: tap the link, see the balance, enter payment info, done.

The page should accept multiple payment methods - credit and debit cards, HSA/FSA cards, digital wallets, and bank transfers.

For larger balances, displaying payment plan options directly on the page can significantly lift conversion.

In our case study, Auburn Community Hospital used Dialog Health's short link strategy to send 13,755 messages over 90 days and achieved a 91% reach rate with a 30% unique link click rate.

A total of 3,740 patients clicked on a unique payment link 4,775 times.

Each short URL was tied to a specific patient through unique person tracking, so the billing team could see exactly who clicked and how often - making targeted follow-up on unresolved balances far more efficient.

Don't Just Set It and Forget It

Technology alone won't get you the best results.

Our case study with Auburn Community Hospital showed that the real difference came from pairing Dialog Health's platform with ongoing expert guidance - actively implementing best practices and tracking performance rather than running a passive, automated campaign.

The data reinforced this. 1,035 patients (28%) clicked their payment link more than once - a strong signal of engagement and intent to pay.

That kind of repeat click-through data gives billing teams actionable intelligence on who to prioritize for direct outreach.

Segmentation also plays a meaningful role in results.

Small balances under $50 might only need a single text.

Balances between $50 and $500 tend to benefit from the full three-to-five message sequence.

Anything above $500 should include payment plan offers and earlier phone follow-up.

Demographics are worth factoring in too. 72% of consumers under 35 say they'd switch providers for a better payment experience, and they respond especially well to text-based billing.

Older patients may need texting supplemented with phone calls and mail, though smartphone adoption among adults 65 and older continues to climb.

Real Results: What We've Seen With Our Clients

Our case study with Auburn Community Hospital captured clear results across a 90-day window from July 17 to October 24.

Out of 13,755 messages sent, 12,532 patients were reached, and those patients generated 5,276 total clicks on payment links.

Auburn Community Hospital CFO Jason Lesch noted that helping patients easily understand their balances, access financial assistance, and pay for care is a top priority - and that Dialog Health's technology simplified the process for patients while giving staff better tools to assist them.

The hospital also used a general tracking link for financial assistance resources alongside individual payment links, allowing the team to measure patient interest in assistance programs at the same time.

Across the broader landscape, healthcare organizations using text-based payment collection report 25-30% increases in on-time payments, with some achieving up to a 65% reduction in accounts receivable.

Your Patients Are Ready to Pay - Are You Making It Easy Enough?

Everything you just read - the smart links, the message sequencing, the two-way conversations - is exactly what Dialog Health helps healthcare organizations do every day.

Our HIPAA-compliant two-way texting platform was built specifically for healthcare, and we've spent over a decade helping organizations like yours collect more revenue with less effort.

The results speak for themselves: 54% increased cash flow with RCM-focused SMS campaigns, and client reach rates above 90%.

Fill out this quick form and one of our healthcare communication experts will reach out to schedule a brief 15-minute video call at your convenience.

No pressure, no long pitch - just a straightforward look at how this works for organizations like yours.

You won't need to rearrange your calendar.

We've done this hundreds of times and only need 15 minutes to show you exactly what's possible.