However, while care has gone digital, payment systems largely have not. For providers, this growing disconnect between virtual care delivery and outdated billing workflows isn’t just an operational oversight; it’s increasingly becoming a liability.
Findings from the PYMNTS Intelligence June Generational Pulse Report revealed that nearly 30% of Generation Z and millennials used telehealth for their most recent healthcare encounter, signaling comfort with digital-first care among young demographics. Mental health services stand out, with 52% of sessions conducted remotely, more than any other category.
A gap is emerging, however, with 68% of Gen Z patients reporting moderate to severe friction when paying for that care. These challenges can range from unclear insurance information and fragmented billing platforms to limited digital payment options.
Providers maintaining outdated payment systems risk undoing the gains of telehealth adoption. As digital-native generations become the dominant healthcare consumers, modernizing the billing experience is no longer optional but is becoming an operational and competitive imperative.
Despite Virtual Healthcare Benefits, Real Payments Friction Exists
The consumerization of healthcare has advanced over the past five years, and Gen Z and millennials are leading that shift. These groups expect digital access, price transparency and fast resolution, all expectations shaped by years of interacting with on-demand services, from ride-sharing to mobile banking.
While digital appointments have become more common, particularly for primary care and behavioral health, the billing systems behind them often remain rooted in legacy infrastructure. Many providers, especially small- to mid-sized practices, still depend on older electronic health record (EHR) systems and disconnected revenue cycle management (RCM) tools.
This fragmentation directly impacts the patient experience. In the same PYMNTS survey, 44% of consumers reported at least one issue when paying for their latest healthcare service. For Gen Z and millennials — accustomed to mobile-native, transparent consumer experiences — this complexity becomes a deterrent to continued engagement.
Providers need to recognize that younger generations are not just tolerant of digital workflows. They demand them. They are increasingly choosing providers based not just on clinical outcomes, but on overall experience.
Read more: Three in 10 Gen Zers and Millennials Use Telehealth. But Paying the Doctor Is Full of Friction
The New Imperative: Modernize Payments or Fall Behind
According to the report, while more than 60% of patients used digital tools to manage healthcare — such as appointment scheduling or prescription refills — less than half reported positive experiences with billing.
Payments friction can reflect structural inefficiencies in how most providers handle the post-visit financial workflow. Many systems still rely on paper-based billing and mailed statements, delayed insurance adjudication processes, separate portals for care delivery and payments, and lack of real-time benefit verification or upfront cost estimation.
Part of the challenge is that many legacy systems were not built with modern payment integrations in mind. Another factor is organizational inertia. For many providers, payment workflows are managed by separate teams from those overseeing digital health initiatives, creating silos that slow innovation.
These operational weaknesses are becoming competitive liabilities. As more patients shift to virtual-first providers and telehealth-native platforms, those offering seamless billing and payment experiences could be better positioned to attract and retain younger consumers.
As telehealth transitions from an emergency solution to a standard of care, aligning billing and payment systems with digital delivery is the next critical step — and it’s one that providers can no longer afford to ignore.
