The three biggest buy now pay later (BNPL) providers, Afterpay, Openpay and LatitudePay, have partnered with MyHealth1st to support the growth of independent optometry practices.
Klaus Bartosch, Chief Executive Officer and co-founder of MyHealth1st, said the partnership solves one of the biggest challenges for optometry practices and patients alike.
“The problem today is that a patient first learns about an optometry practice’s BNPL options when it is too late – at the point of sale. Additionally, users of BNPL (referred to as members) don’t have an easy way to find optometry practices that offer their preferred payment options. This has been a massive missed opportunity,” said Mr Bartosch.
the perfect time for practices to advise their patients that they offer BNPL is when they book an appointment… There’s no point in telling them when they’ve made a purchasing decision
“Now, as a result of this partnership, patients and prospective patients of optometry will be educated about the practice’s BNPL options at the time of booking an appointment – whether they are using the MyHealth1st online booking platform or booking by phone. Patients also have the option to nominate the BNPL service they are considering using at their upcoming consult.
Additionally, practices that nominate a preferred BNPL provider for their business will unlock a series additional benefits, including being promoted to the BNPL provider’s existing member-base.
Mr Bartosch said offering BNPL options makes business sense for practices as consumers increasingly embrace this method of payment.
“Many optometrists don’t consider themselves to be retailers, but alongside their clinical expertise that’s exactly what they are,” Mr Bartosch said. “In their capacity as a retailer, it’s their job to make every customer’s experience as easy and convenient as possible, and one way to do this to offer a range of payment options.”
He said BNPL offers consumers a more manageable way to access eye health services and purchase quality frames, lenses and additional eyewear they may otherwise not have been able to afford right away.
“Unlike credit cards, BNPL providers don’t charge interest and have set repayment periods. Each provider has a maximum allowable credit limit and some require users to ‘earn’ a higher credit limit by demonstrating their ability to pay off smaller amounts.
“If a user misses a payment, they are charged a fee (which differs according to each provider) and if they miss multiple payments, their ability to access credit will be cancelled.”
BNPL is rapidly taking the place of traditional credit cards. This, Mr Bartosch says, is because the latter are expensive. “Even though interest rates have come right back – you can take a mortgage to buy a house with a 2.5% interest rate – credit card companies have not reduced their interest rates with some still charging as much as 21%pa.”
Perhaps for this reason, the demographic of BNPL users is rapidly widening.
According to Latitude Financial research, BNPL initially captured the younger demographic (<30 years old), however a more mature group of consumers has entered the category in 2021. In the quarter to August 2021, BNPL use among 35–44 years experienced significant growth (45% have and use at least one BNPL service vs. 36% in the previous quarter) and older groups saw a rapid increase, with a quarter of those aged 55+ (24%) now using a BNPL service, up from 13% in the past quarter.1
It’s All About Timing
Nick Grant, Head of Healthcare at the BNPL provider Openpay, said it made sense for Openpay, as a leading BNPL provider, to partner with MyHealth1st.
“The Openpay and MyHealth1st partnership commenced after both businesses had a mutual client, ProVision. Initial discussions identified that we both serviced similar segments in the healthcare sector with complimentary digital solutions, and believed we could create a valuable solution for both practices and patients,” said Mr Grant.
“Based on recent research we found a need to combine payments and digital booking solutions for health services – 39% of consumers prefer using BNPL for healthcare costs, and additionally, 32% of customers would consider switching health providers for access to flexible, digital payment plans.”2,3
Mr Bartosch said the perfect time for practices to advise their patients that they offer BNPL is when they book an appointment.
“There’s no point in telling them when they’ve made a purchasing decision and they’re at the counter ready to pay.
“Tell your patients you offer BNPL ahead of time, and they will be mentally and financially prepared to purchase the frame and lens or eye health treatment you recommend without feeling pressured by concerns of affordability. They’ll feel comfortable knowing that by using BNPL they can access the quality eye health and vision correction they need, then pay it off comfortably, over time.”
Latitude Financial Services currently has arrangements with around 1,500 optometrists including large, mid-sized and independent providers as well as major groups in ophthalmology.
Leigh Dewar, Healthcare Business Leader says, “Providing payment options to patients helps improve accessibility to vital optometry and ophthalmology services. This allows practices to focus on providing the best possible service to your patients rather than managing their funding challenges. “
“By partnering with MyHealth1st, we aim to make patients aware that LatitudePay is available as a payment option prior to their appointment.” In doing so, he said patients will have more flexibility and time to consider their purchasing decisions, resulting in a better experience for patients, which helps drive increased revenue for practices.
At Openpay, Mr Grant agrees prior notice of payment options is essential. “We know that patients defer healthcare treatment due to cost, so being able to communicate flexible payment options earlier in the patient booking journey helps to solve a problem for both patients accessing care, and practices accessing patients,” he said.
Prep Work Done
To make the BNPL conversation with patients easy for eye health professionals to initiate, practices that nominate a preferred BNPL partner will receive an alert when, at the time of booking an appointment, a patient nominates the same BNPL provider.
“We know eye care professionals are passionate about the clinical side of their work but they’re often not as comfortable when it comes to selling services and products to promote great vision and healthy eyes,” said Mr Bartosch. “We have seen this before with contact lenses – one of the reasons why contact lenses have a small 5% uptake in Australia (as opposed to a global uptake of 25%) is that eye care professionals don’t feel comfortable selling in the concept. So we’ve made it easy by integrating BNPL into the Optomate and Sunix practice management systems. When a person makes an appointment and nominates the practice’s preferred BNPL provider, this information will be captured in Optomate and Sunix. What this means is that the eye care professional, or optical assistant will know the customer wishes to pay with BNPL and will, therefore, feel more comfortable having the conversation.”
Provider Support
Today, the majority of product and service retailers accept multiple credit cards and Mr Bartosch suggests that similarly, practices should accept multiple BNPL options. Doing so will optimise convenience for patients and maximise opportunities for the business. However, within the MyHealth1st partnership with Afterpay, Openpay and Latitude, he says practices that nominate one preferred BNPL partner will unlock business building benefits.
“You’ll be promoted to that partner’s network of users, and you’ll also unlock features on the MyHealth1st platform that will enhance the service you offer patients, including appointment confirmations and reminders of BNPL availability for patients that provide information on how to set up a BNPL account prior to their appointment, should they wish.
“BNPL is here to stay and it’s growing. My suggestion is that practices take the time to contact Openpay, Latitude and Afterpay to discuss their offering and how it can be embedded in the practice before deciding on their preferred provider.
Mr Bartosch concluded, “They all have different customer credit arrangements and different merchant fees, however they all offer potential for optometry practices to significantly grow their revenue by increasing average transaction values and enabling patients to access more eye health services.”
References
- Latitude Brand Health Tracker, Aug ’21, Base: Australian Consumer Representative (n=1,900) BNPL service defined here as any ‘pay later’ service which allows a customer to buy what they want now and pay later over a series instalment.
- Supergrowth, Openpay Brand Research, 2-5th October 2020.)
- Healthcare Payment Experience Report – Pymnts.com January 2021).
