Watch Out for Credit Card Payments from Payers! - DoctorsManagement Watch Out for Credit Card Payments from Payers! - DoctorsManagement

Watch Out for Credit Card Payments from Payers!

Your practice could be losing money thanks to a new method of reimbursement.

Some payers are now using credit cards (actual or virtual) instead of paper checks or electronic fund transfer. This can cost your practice from 1.9% to 5% per transaction. Using this form of payment shifts the cost of transferring money, in the form of transaction fees, from the payer to you, the practice. Also, in some cases, the payers are receiving incentives from credit card agencies.

In an article on, Priscilla Holland, senior director of health care payments at NACHA, the Electronic Payments Association, said credit cards are a type of EFT and may fill a void in the current marketplace, but many people may be unaware of how they work. Transfer fees often are used to offset fraud prevention and to validate that the paying account has funds available for the transaction, but she said such fees to pay for physician services are unnecessary.

The AMedNews article cited that the Department of Veterans Affairs is one of several payers using this method to pay providers, which may cost a physician as much as 5 percent.

The American Medical Association offers the following tips to avoid being saddled with an expensive credit card payment method:

  • Review and evaluate your payer contracts to determine if it is required to accept credit cards as a method of payment from your payers.
  • Understand merchant card agreements and associated fees if you decides to accept credit cards.
  • You may also want to ask if payers are using credit card reward programs that give them cash back. Request payment using the health care EFT standard known as ACH CCD+. This transaction, approved by HIPAA, is less costly to providers than credit card transactions.

Click here to read the full AMedNews article, “Doctors Short Changed by Insurers’ Shift to Credit Card Payments.”

Have you reviewed your payer contracts lately?
For more information on payer contract reviews and negotiation assistance, contact Bob Rotar at 800-635-4040 or send him an email.

If you have questions about this topic or any other issues around the business of medicine, contact us via email or call us at 800-635-4040.