Electronic Payments: Reduce the Cost of Getting Paid KNOW THE OPTIONS AND AVOID UNNECESSARY RESTRICTIONS Published with permission of the American Medical Association (AMA) he healthcare claims revenue cycle has increasingly moved from the use of paper checks to various T forms of electronic payment. Although this has the potential to save physicians, health plans, and the overall health system millions of dollars each year, potential savings can only be realized if electronic payment is implemented effectively by physicians. Physician practices transitioning from paper checks need to ensure that they understand the various forms of electronic payments offered by health plans in order to choose the appropriate method and avoid those that may have unintended consequences, such as lost revenue. Two of the most common forms of electronic payment offered are virtual credit cards (VCCs) and automated clearinghouse (ACH) electronic funds transfer (EFT). Virtual Credit Card Payments To disburse claims payments, many health plans have shifted from paper checks to VCC payments. With this method, a health plan sends credit card payment information and instructions to physicians, who process the payments using standard credit card technology. The payment is then sent via credit card networks, carrying applicable transaction and credit card interchange fees. This method is beneficial to health plans but potentially expensive for physicians. VCC payments are subject to transaction and interchange fees that can run as high as 5 percent per transaction for physician practices. VCC costs can add up quickly, as a North Carolina radiology practice learned after paying more than $9,000 in interchange fees over the first five months of 2014. In contrast, health plans often receive cash-back incentives from credit card companies for implementing VCC transactions. additionally, this payment method is not capable of being paired with a compliant HIPaa standard electronic remittance advice (era), which can result in reconciliation issues. Implementation of VCC payments varies depending on the payor. an increasingly common and troubling trend is health plans transitioning to VCCs without providing advance notice to or receiving authorization from providers. In these circumstances, providers simply receive VCCs in lieu of their traditional form of payment and are required to contact the health plan and formally opt out of the VCC program. Automated Clearinghouse (ACH) Electronic Funds Transfers (EFT) In order to promote efficiency in payments, the federal government recognized aCH-eFT as the standard form of electronic payment for all healthcare claims. The aCH-eFT standard, which utilizes the NaCHa – The electronic Payments association – Cash Concentration and Disbursement Plus addenda (CCD+) format, is a payment method that allows health plan payments to be directly deposited into a physician’s designated bank account (similar to direct deposit often 28 HBma BIllINg • NOVemBer.DeCemBer.2014
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