A Case for Digital Patient Refunds

How health care providers can streamline the payout process to improve operational efficiency, reduce costs and boost patient retention.

June 18, 2025 | | Written by OnBe

In today’s fast-paced health care environment, every second counts—and efficiency matters at every touchpoint. That includes the medical refund experience, a frequently overlooked part of the patient’s journey. As hospitals and health care systems focus on streamlining their operations, the refund process can serve as an opportunity to modernize outdated and costly systems, saving time and money while boosting patient satisfaction with faster, more convenient payouts.

A Frustrating Experience
Medical refunds are a common occurrence, with nearly half of respondents receiving them according to Onbe’s recent health care survey. These payouts typically follow discrepancies such as billing errors, duplicate payments, or insurance claim adjustments. And too often, they fall short of patients’ expectations, with over 50% reporting a delayed, lost or incorrect refund. Dissatisfactory payment experiences can lead to the loss of trust or a financial burden if the patient must wait too long to receive their funds. Patients may even consider switching providers, with 71% saying a frustrating payment experience would be a reason to look elsewhere for care.

The Cost of Checks
Delays and errors abound because many health care practices still rely on manual processes and traditional payment methods such as paper checks. Not only do checks require days to weeks of processing time, but they are susceptible to loss and theft, with the Federal Bureau of Investigations and United States Postal Inspection Service recently warning that check fraud is on the rise. This added risk and administrative burden come at a cost for health care providers—up to $12 per check when factoring in employee labor, postage and fraud handling.

Switching to Digital
Digital refund solutions offer many advantages, starting with more secure and cost-efficient payment options. Health care providers can provide patients with the digital choices they prefer, from fast bank transfers to instant virtual cards—at a fraction of the cost of checks. Digital solutions also automate the payout process to minimize manual tasks, saving time for busy health care teams while reducing delays and errors, ultimately providing greater visibility into payment statuses, making it easier to trace refunds and address discrepancies. Given the complexity of health care billing, mistakes can still occur. However, the transparency of digital payments becomes especially valuable when refunds go unclaimed or remain unresolved. In such cases, health care providers must comply with escheatment laws, which require unclaimed property—such as uncashed checks—to be reported and transferred to the state. This process can be complex and time-consuming and carries the risk of hefty penalties for non-compliance.

Digital payment methods help reduce the likelihood of unclaimed refunds by delivering faster, more accurate payouts while simplifying compliance with escheatment regulations. By modernizing their refund processes, providers can improve operational efficiency while ensuring financial accuracy and safeguarding patient trust.

Improving the Patient Journey
Perhaps most importantly, modernizing the payout process helps to make refunds more immediate and convenient for patients—no more waiting weeks or months for a check in the mail following overpayment on a medical bill. Improving the payment experience has been shown to boost patient satisfaction and trust, reducing churn. In fact, 74% of patients say they would be more likely to stay loyal to providers that offer fast, error-free refunds. Digital payouts deliver on expectations for speed and accuracy, making them an increasingly essential upgrade for providers seeking to improve operational efficiency while streamlining the patient journey.

About Onbe
Onbe is a fintech that manages and modernizes customer and compensation payments. Learn more at www.onbe.com.