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Solution Perspective: Pre-Service Financing

Health systems, hospitals and physician practices are increasingly engaging patients in financial discussions earlier in the continuum of care. Conversations around cost estimates, financing options, and upfront payments are becoming more common prior to service. Patients generally welcome this initiative since paying for care is a primary concern for many.

Managing pre-service financing poses several challenges and complexities. This CommerceHealthcare® Solution Perspective briefly explores the issues and highlights the bank's approach to helping providers meet their patients' needs.

Key Issues

The trend toward pre-service financing responds to a broader set of objectives, including:

  • Providing greater access to care. By removing barriers to care, such as affordability, providers can foster greater health equity and improve population health management. Many patients struggle with increasing out-of-pocket obligations. A recent Harris poll found that healthcare costs are a financial strain for over a quarter of Americans, with nearly as many having insurance coverage gaps.
  • Creating a better patient financial experience. The industry is responding to heightened patient expectations for convenience and choice. Improvement is needed as evidenced by surveys such as one showing that 65% of patients didn't receive a pre-service estimate, and 40% of them were likely to cancel or postpone procedures as a result.1 Urgency to enhance the patient financial journey is driven by increasing competition from consumer-centric providers from retail, technology, and insurance industries. 
  • Maintaining financial health. The financial condition of health systems and hospitals has largely recovered from the negative impact of the pandemic. However, an estimated 40% continue to incur operational losses.2 Longer-term forecasts see “protracted margin compression.”3 Industry cash reserves remain lower than before the pandemic, due in part to aggressive insurance reimbursement denials that also become another risk factor for patient care avoidance. Continuing to build revenue and conserve cash are imperative now.

The Pre-Service Need

These various forces have converged to place greater focus on the pre-service aspect of the patient financial journey. Healthcare organizations face constraints attempting to accommodate the wide array of financing needs presented at this stage. Many providers require help maximizing patient assistance while preserving economic health.

The CommerceHealthcare® Solution

Health Services Financing (HSF®) from CommerceHealthcare® enables providers to offer patients a no or low-interest line of credit based on estimated out-of-pocket charges. Financing can be issued with no credit check and through contactless processing (phone or online). Patients gain peace of mind knowing their monthly payment amount and assured that the credit line will be in place. 

The process is straightforward and streamlined as displayed Figure 1. Estimated charges are offered, and appropriate payment options are reviewed. A patient’s verbal acceptance of this choice triggers enrollment using the estimated charge amount. Commerce approves a no- or low-interest line of credit for the entire estimated amount without the delays of a credit check. Providers receive the full funding immediately, which they in turn post to the patient’s account.

Graph showing how pre-service and post-service payments work

What if final cost of care diverges from the estimate?

The CommerceHealthcare® open line of credit can be seamlessly adjusted without time-consuming involvement from internal staff. Figure 2 above shows how corrective actions can be taken. Increased charges are added directly to the credit line, while overestimated costs initiate downward adjustment. Any transaction fee incurred for the overestimated amount is refunded.


Pre-Service Funding: A Win for All

This program is a significant addition to the financing toolkit and carries far-reaching benefits for providers and patients alike.


  • Clarity and peace of mind.  Patients know their payment obligation with defined terms. That lets them concentrate on making the best health decisions. Further comfort comes from the fact that any subsequent charges can be consolidated onto the credit line.
  • Streamlined process. No credit check and simple enrollment remove frustrations typically associated with the financing process.
  • Greater choice. Flexible loan durations and terms can optimize patient choice.


  • Maximum access. Providers can expand the number of patients who qualify for financing, allowing them to receive the care they need and want.
  • Improved operating margins and cash flow. Full, up-front funding accelerates cash flow, reduces receivables, and helps avoid bad debt.
  • Enhanced financial clearance process. Administrative items are resolved early.
  • Better patient financial experience. Promotes a compassionate experience that increases customer satisfaction.
  • Support for staff working remotely via an efficient and contactless process.


Pre-service patient financial engagement is a growing trend. Providers have a timely option to address the opportunity with the HSF® solution. It represents the right program with the right financial partner. 


  1. Experian Health, The State of Patient Access: The Digital Front Door, 2023.

  2. S. Becker and M. Gamble, “7 Healthcare Trends We’re Watching Now,” Becker’s Hospital Review, March 4, 2024.

  3. Fitch Ratings, “2023 Median Ratios: Not-for-Profit Hospitals and Healthcare Systems,” July 25, 2023.