Payment Solutions for Healthcare

An efficient and hassle-free payment system is essential for every business, regardless of size, to run without a glitch and retain customers. When it comes to healthcare, secure payment systems and solutions become even more crucial, due to the large value of most transactions.

Digital payments are expected to touch $11.55 trillion in 2024, according to Statista, and are projected to grow at an annual growth rate (CAGR) of 9.52% every year until 2028. Given this strong growth rate, having secure healthcare patient payment solutions has become even more vital now.

What are payment solutions?

A payment solution is what allows you to function as a business, i.e, charge money for your goods and services, both physically and online. Most payment solutions will let your clients pay via a number of different payment methods.

Payment solutions are made up of two parts, payment gateway and a card redeemer. A payment provider will also usually include a technical platform, depending on the solution you would like to use. The forms of payments you can accept, for example MasterCard, PayPal or Google Pay will also depend on which payment solution you’re using.

How does healthcare payment processing work?

Healthcare payment processing solutions can vary, depending on whether they’re paying by cash, online payments, phone payments, cheques and debit or credit card. In a lot of cases, healthcare providers may use a fee-for-service (FFS) model, where a healthcare service is first provided, then a bill is sent to the patient, usually by mail.

Usually, this bill is sent to the patient’s health insurance company, however, if the insurance does not cover the whole bill, the patient is liable for the outstanding amount.

For credit or debit card payments, the card is usually swiped, inserted or tapped onto the card reader, or details entered into an online payment gateway.

The card reader will then ask the payment processor for authorisation to share the card details with the patient’s bank, to be approved in turn. Following this, the healthcare provider’s merchant account sends the money through the payment processor to a card association for the final settlement.

Due to the number of separate, but essential steps of the entire payment process, it is essential for medical providers to have secure healthcare credit card processing systems.

How can healthcare credit card processing be done safely?

Given the burgeoning number of credit card transactions, safe and secure medical office credit card processing has become even more important recently.

In case of using business associates who fall under HIPAA regulations for healthcare payment solutions, it is also important to make sure that no treatment or care-related information that could be considered confidential is taken for the payment.

Furthermore, some technological upgrades such as using chip card technology, instead of magnetic card technology can greatly decrease the chances of scams and frauds. Similarly encrypting your healthcare technology, as well as implementing an Interactive Voice Response (IVR) system can also greatly strengthen the safety of your payment solutions for healthcare.

What are medical merchant accounts?

Medical merchant accounts are essentially intermediary accounts between a healthcare provider’s business account and the patient’s individual account and bank. As such, your healthcare merchant account can receive debit card and credit card payments, as well as online payments from patients.

Once the funds are received in the merchant account and cleared by the client bank, they are then transferred to the healthcare provider’s business account, usually within 1-2 days. However, healthcare providers cannot access their merchant accounts directly, to add, withdraw or move funds.

Medical merchant services are used by clinics, hospitals, insurance, medical e-commerce companies, medical suppliers and more.

Does a healthcare payment solution need to be HIPAA compliant?

Usually, only those entities that the Health Insurance Portability and Accountability Act (HIPAA) considers to be business associates are required to be compliant with its regulations. In most cases, healthcare payment processing providers would not fall under the category of business associates, due to them only providing purely routine financial services and support. As such, they would not need to be HIPPA-compliant.

However, if a healthcare payment service also provides other related services such as medical billing, reporting or practice management, it would be seen as a business associate and thus would be subject to HIPAA regulations.

How to choose the right healthcare payment solution

There are several points that need to be considered before choosing the right payment solution for healthcare providers. Key amongst these is analysing your ongoing payment processing system and taking note of any current issues that need to be fixed.

Once this is done, payment providers would need to decide what kind of payment processing requirements they have, and what kind of features payment systems would need to have to be suitable.

This may be things such as integration with current systems, being HIPAA-compliant, data security and privacy features and within a certain budget.

Other factors to be considered may also be ease of use and optimum user experience, as well as the number of different payment methods that can be supported. Furthermore, ideally, healthcare payment solutions should also be quite flexible, offering options such as patient financing programs. Needless to say, it should also be regulatorily compliant and offer efficient customer service.

Once you have found the right payment processing system, you need to integrate it with your current systems and databases, following which the new payment system can be tested, usually with dummy transactions.

If there are no glitches at this stage, the new system can go live and can be used to accept real payments from clients.