Credit Card Processing for Medical Clinics

Medical chargebacks are common, but they rarely happen due to fraud. Instead, patients are confused by vague billing codes that label charges, frustrated that insurance denies the payment after payment or unhappy that your refund policy is unclear. For example, an insurance company might deny payment on a procedure after it is done, resulting in a patient chargeback. A processor who has worked with the medical field can help you create standards to avoid such disputes, such as consent forms, timestamps of payment authorization, email receipts, and patient double-checking before a credit card swipe.

Medical facilities must comply with PCI DSS standards, and oftentimes, HIPAA as well. Confirm your processor meets compliance for both; if your processor does not comply, then your business is at risk legally and monetarily. This goes beyond storing and transmitting credit card data, but also includes sensitive health data protection. If your POS or software doesn’t comply with the above, it’s time to find another.

Your processor should support various payment methods, cards, mobile wallets, and even HSA/FSA cards. The more payment options available, the more patients are fulfilled, and payments are received. Some systems support recurring billing, too, which is helpful for membership-type services or payment plans, which is advantageous for those clinics that package services or extend over many months^[3].

Processors that alert you of disputes in real-time and provide chargeback tracking are essential. This allows you to respond and be heard quickly, increasing your chances for a favorable outcome. Additionally, seek processors who give opinions on appeals and policy assessments. These proactive measures help avoid lost revenue and strengthen your bond with your processor.

While processors in the high-risk category may be more expensive, a transparent relationship should still exist. Have them break down transaction fees, monthly fees and chargeback fees. Avoid processors with significant reserves or contracts exceeding one year unless they offer something incredibly valuable. Understanding your expenses benefits future billing choices.

Your processor should not freeze your account because of regular patient involvement, so ask how many disputes are allowed before they cease processing. Some shut down accounts after a handful of flagged transactions. Ask them about their levels of tolerance and what occurs when a dispute is triggered. The best processor will work with you, especially during busy times and practice evolutions^[4].

When something goes wrong, whether it’s a declined batch or an integration issue, you want support right away. Thus, processors with healthcare-support trained account managers and 24/7 support are the best fit. The best processors have account managers who know your practice’s needs and can advocate for escalated review if necessary.

Credit card processing services should know medical billing and the risks that come with it. Merchant services for retail will not reflect all of your needs, such as HSA/FSA cards, chargebacks due to insurance, and more. Therefore, seek those who specifically market themselves to the healthcare enterprise and have case studies or testimonials by other healthcare professionals. These processors are more likely to have secure merchant services, underwriting for high risk, and white glove treatment upon onboarding.

The best POS systems do more than run a credit card; they help with appointments, co-pays and follow-ups. A cloud-based POS system that allows for patient profile management gives insights into billing and payment histories and how much a client owes before they even sit in the chair. They can also assess insurance eligibility. When merged with your EHR, there’s less duplication of entry and easier reconciliation. Some offer built-in text or email reminders for payment due and check-ins.

If customers are aware of payment policies before services are rendered, they’re less likely to charge back or pay late. Since there are bona fide reasons why payment is required, whether via intake forms or for large procedures, you can create a sense of goodwill from the get-go. Ensure customers know how you came up with the balance owed using discounts and insurance adjustments on invoices. Integrated tools like e-signature for service agreements and payment plans, or the processor’s ability to generate itemized receipts, can avoid confusion.

Fraud tools protect your practice from payment chargeback gremlins and patient identity theft. CVV, 3D Secure and device fingerprinting are payment verification tools that ensure legitimate payments are made before processing. The Tokenization series ensures you can bill patients for recurring payments without storing personal information, keeping you compliant and ensuring your patients’ personal information is protected.

Q: Why are payment processors wary of medical merchants?

A: Payment processors are wary of medical merchants due to the nature of the business, chargebacks, and compliance. Medical merchants that offer elective services, supplements, and any recurring monthly services tend to have a higher chargeback ratio. Additionally, medical merchants are scrutinized more than other industries, making payment processors leery of requiring an extensive amount of merchant account approvals with underwriting and documentation.

Q: How can medical merchants reduce chargebacks?

A: Medical merchants reduce chargebacks by implementing better billing practices and transparency, signed consent during service, automatic receipts provided immediately after an appointment, credit card payment types with address verification, and prompt alerts. Having a clear refund policy with patient awareness decreases the chances of misunderstandings, leading to chargebacks.

Q: Can medical merchants accept HSA and FSA cards?

A: Yes, however, not all payment processors allow it. To accept HSA or FSA cards, a proper merchant category code must identify the facility as a medical provider; Consult with your payment processor about this category and the IRS guidelines may differ on both ends. Accepting these cards gives patients easier access to funds for their services^[5].

Q: What does it mean if a processor drops my clinic?

A: If a processor drops your clinic, not only will you lose precious revenue, but also your place on the MATCH blacklist. MATCH complications arise from being flagged as high-risk merchants and using non-high-risk processors. Getting set up with a high-risk merchant processing provider that understands the nuances of healthcare avoids such pitfalls. They’ve been in business long enough to know how to cater to medical business structures, meaning they’re less likely to shut down and leave you high and dry.

Q: Are there POS systems designed for medical clinics?

A: Absolutely. Numerous POS systems are designed specifically for medical clinics. They connect to EHRs, allow for HIPAA compliance, enable patient tracking, multi-payment options, and recurring billing for ongoing treatment. Choosing the right POS system boosts productivity and makes the patient experience that much better.

Q: Is it more expensive to use a high-risk payment processor?

A: It can be. High-risk payment processors often have higher fees. This is due to their overhead in chargeback prevention and fraud measures. However, high-risk merchants offer tools and expertise that low-risk processors cannot. The increased costs are worthwhile for medical clinics to receive the ongoing support, stability, and compliance guidance they need.