Challenge

Anyone who has visited a doctor’s office or hospital knows how frustrating the medical billing experience can be. Patients receive a confusing mix of communications from their provider and their insurance company, making it difficult to sort out how much the visit cost, how much of the cost insurance has covered, and what the patient is responsible for paying.

On the other side of that transaction, providers struggle with high rates of delayed or unpaid collections. Their office staff must also bear the costs of the administrative work required to coordinate billing between their practice, their patients, and insurance providers—often sending multiple copies of paperwork, fielding phone calls from confused patients, and managing communications with insurance companies. These challenges across this system are driving negative margins for many medical providers.

After a frustrating medical billing experience in his own family, Florian Otto was inspired to develop a solution that improved the end-to-end patient journey and simplified administration and billing functions for medical providers. He created Cedar in 2016, a platform that integrates with major electronic health record (EHR) systems and provides an elegant patient experience layer to manage pre-visit payments, post-visit billing, and payment collection. Today, New York City–based Cedar works with a range of providers, including regional integrated health systems, physician-owned practice groups, and specialist networks, and it engages with 25 million patients annually.

As the team was developing the Cedar platform, they knew that its payment engine would be critical to transforming the medical billing experience. The company focused on finding payments technology that added value for providers and patients beyond simply enabling online transactions. For providers, Cedar wanted to enable reconciliation and simple patient payment experiences regardless of the provider organization’s complexity. On top of that payment experience, Cedar needed to layer integrated data from insurance companies and health savings account (HSA) providers to consolidate the patient billing experience.

Cedar also wanted advanced payment processing technology to help maximize conversion and acceptance rates while offering a simple, intuitive digital payment experience for patients. The company’s goal was to offer a range of payment methods that made paying medical bills as easy as other common purchases. “We wanted to engage people with a digital payment experience that they’ve come to expect when using Uber or Amazon or Netflix,” said Daiven Chawan, a product manager at Cedar.

Solution

Cedar selected two Stripe products to power its Cedar Pay offering: Stripe Connect, which allows platforms to manage the movement of money across multiple parties, and Stripe Payments, which supports more than 100 payment methods for online transactions. The advanced features offered by Stripe technology and its developer-friendly solutions made it easy for the Cedar team to link information from providers’ billing and EHR systems with payment processing to create a personalized patient billing experience.

Connect accelerated the development of Cedar Pay because of the work Stripe had done modeling connected accounts and developing systems to manage fund flows and payouts. The Cedar team was able to implement those models and systems in its own platform as it designed accounts that reflected the hierarchy of its providers—including large medical systems that have multiple hospitals and practice groups.

Cedar linked those provider accounts into a unified medical payer ecosystem by creating integrations with insurance plans and HSA accounts, creating a consolidated view of medical bills and payment information. That meant that patients now see multiple charges across different business units as a single line item on their statements, along with an insurance company’s explanation of benefits (the services and amounts covered by the patient’s insurance), the amount the patient owes, and the payment due date. Through the integration with HSA providers, Cedar Pay displays the balance of funds in the patient’s tax-advantaged account as a potential source of funds to pay their portion of the bills.

To improve acceptance rates, Cedar took advantage of Stripe authorization optimizations, such as Adaptive Acceptance, which identifies optimized retry messaging and routing combinations to recover false declines, and network tokens, which allow card networks to automatically update card numbers to prevent payment failures. Using Payments also allowed Cedar to enable multiple payment methods beyond credit cards, including ACH transfers, Apple Pay, and Google Pay.

To encourage timely payments, Cedar Pay incorporates data-driven best practices and provider preferences to create an automatic communication flow using a combination of text, email, and paper statements. All of Cedar’s communications direct patients to their provider’s white-labeled site, where they can review all of their visit data or simply make a payment in three clicks using any of the payment methods accepted by Cedar Pay.

After building Cedar Pay’s online billing system, Cedar added Stripe Terminal for in-office payment processing, making Cedar Pay a full-service solution and creating opportunities for further expansion of its services.

Results

Ease of Connect integration accelerates Cedar Pay’s go-to-market time

Cedar and Stripe first partnered in 2016. A small team of three Cedar developers completed the initial integration of Connect into Cedar Pay within six months while splitting their time across other platform development tasks—not just the payment integration.

“We were able to maintain a small but mighty crew and use our resources elsewhere because of the straightforwardness, stability, and simplicity of the Stripe integration,” said Dickson Cohen, a product manager on the Payments team at Cedar.

Stripe API uptime and authorization optimizations boost payment acceptance

Cedar Pay offers providers assurance that patients can reliably pay their bills online because of Stripe’s industry-leading uptime of 99.999%. The additional authorization optimizations included in Stripe technology also help ensure that legitimate payments aren’t declined. For example, in 2023 Cedar achieved a 0.2% payment acceptance uplift with Adaptive Acceptance and a 1.61% payment acceptance uplift with credit card account updater and network tokens.

Alternative payment methods gain traction among patients

Cedar Pay delivers the streamlined consumer payment experience that patients are used to from other ecommerce sites. Offering multiple payment methods has made it easier for patients to pay their bills online.

Cedar has seen growth in the number of patients choosing noncard payment options, with roughly 8% of recent payment volume coming through ACH debits and 5% coming through Apple Pay.

Cedar is looking to further enhance its payments experience and increase conversion by making better use of Stripe’s Optimized Checkout Suite. The suite of products includes embeddable UI components through Stripe Elements and the ability to offer additional alternative payment methods with no extra coding. One example Cedar is exploring for 2025 is Link, Stripe’s accelerated checkout solution that saves and autofills customers’ payment information for fast and easy future payments.

Cedar Pay generates 90% patient satisfaction rate

Cedar sends post-payment surveys to patients after each transaction. The results of those surveys show that Cedar is helping transform a frustrating, confusing experience into a simple one, helping Cedar maintain a 90% satisfaction rate among Cedar Pay users.

“We hear from patients and providers that the payment and checkout experience is really solid and smooth, which is in-line with our original hypothesis,” said Chawan. “People are getting an experience they expect and appreciate from Cedar Pay.”