Buy now pay pater is a fast-growing space. But given how much competition is in the field, and how growth inevitably slows, BNPL players are wise to cast about for new segments for growth.
Hence, two major BNPL players, Afterpay (owned by Block) and Sezzle, have set their sights on healthcare.
Healthcare is big. And it’s expensive. These two factors are perfect for a popular and relatively new payments model that helps consumers swallow big expenses in bite-size chunks.
According to Insider Intelligence, citing the Centers for Medicare and Medicaid Services, U.S. national healthcare expenditure reached $4.1 trillion in 2020. That’s $12,530 per person. It’s expected to reach $6.2 trillion by 2028.
Healthcare in Four
Afterpay has signed a deal with EyeBuyDirect, a leading online prescription eyewear retailer. The deal lets’ EyeBuyDirect customers to use a BNPL pay in four model to purchase eyewear. The deal’s framed as a way to help consumers manage the high cost of healthcare.
“Eyewear can be expensive. And while EyeBuyDirect is known for affordability, we understand it is still an extra expense,” said Jim Merk, Brand Director at EyeBuyDirect. “Partnering with Afterpay was a natural way for us to make it possible for anyone to purchase our eyewear. Cost should not be a prohibiting factor in anyone’s decision when it comes to their glasses.”
“At WellNow, our priority is to make healthcare more convenient, accessible, and affordable across the communities we serve. And this includes providing more financial options and flexibility,” said John Radford, MD, President at WellNow Urgent Care. “No one should ever delay care because they’re worried about their ability to pay at the time of service. So we’ve made it possible for them to pay in a way that works for them without the worry of interest fees.”
Sezzle amnnounced a deal with WellNow Urgent Care to allow patients to pay for urgent care in installments. The service is currently actrive at more than 100 locations in New York, Ohio, Illinois, Michigan, and Indiana. Sezzle’s model offers an interest-free pay in four plan. Consumers pay one-quarter up front, and the balance over three future installments.
A Big Opportunity
These are not the first efforts to apply BNPL to health care spending. Laast year we wrote about PayZen, a California company raising a $15 million Series A to scale up its “care now pay later” model.
PayZen and others have identified healthcare as a ripe target for BNPL. And it’s easy to see why. According to PayZen, U.S. medical debt stands at $300 billion. And cost concerns lead almost one out of three Americans to defer receiving medical care.
PayZen launched in 2019. The company’s stated mission is to develop health care payment options that will allow more people to access care. PayZen says it uses AI to help health care providers to get a more accurate gauge of a patient’s ability to pay.
