PayZen, a payment technology company for healthcare providers, has extended its credit facility to $200 million.
PayZen's service, which has already been implemented in 30 providers nationwide, including Geisinger, allows patients to pay over time for healthcare procedures. The company uses AI and machine learning in its payment platform.
“With high inflation, the demand for our service has accelerated dramatically,” said Itzik Cohen, PayZen’s co-founder and CEO. “Both providers and patients are feeling the pain even more than before.”
In addition to the enhanced credit line, the company said it had secured $20 million in new equity funding. It announced the funding at the HLTH conference held at the Venetian Expo Center in Las Vegas. The credit facility was led by Viola Credit, an Israel-based venture capital firm.
For patients, the service allows interest free payments over an agreed term. rIn return, providers take a reduced cut of a patient’s final bill by selling the debt to PayZen for an agreed amount. The company allows providers to receive the full amount upfront and said it informs billing teams to not send individual patients to collections who are enrolled in their plans.
“There's an affordability problem in healthcare, regardless of if you have health insurance or not,” Cohen said. “More and more [provider] revenue [is] coming from or expected to be paid by the patients.”
PayZen said its average financed amount per enrolled patient is around $1,500, a number it hopes the new line of credit will help increase to around $2,000.
Each interaction is dynamically priced, which translates to a reimbursement rate that can vary for providers from north of 90 cents on the dollar, down to 70 cents.
Cohen said more than 10,000 patients have used the service which first sends text message prompts including the original bill.
According to Cohen, 96% of patients enrolled in PayZen program pay their bills in-full and on-time.
“These are decent people who want to pay their bills,” Cohen said. “The number one reason in healthcare for non-payment is the lack of payment options.”
The company anticipates new deals signed with providers this year are expected to yield ten-times growth in 2023.