@Mik said in Healthcare Electronic Payment Shenanigan:
And the check gets lost in the mail and has to be processed in house and will not hit the bank for several more days. All these things are important to providers who operate on a very narrow window. Cash flow is king. Don’t read an article like that and assume you can divine the truth.
Whether to take the risk with the checks missing in the mail and whether to accept delays due to the postal service are the service providers’ decisions. The payment processors have no right to use those pretexts to extract extra revenue from the payments’ rightful recipients.
Heck, if you read the article, you’d see that there is also dispute on whether the payment processors are legally allowed to take a cut at all.
The insurance company wants to “outsource” payment processing to another company to process payments to their service providers, fine. But why should the providers be made to give up a percentage of their fees to those payment processors just because the insurer outsourced the payment processing function?
In the world of “consulting,” I have seen some consultants voluntarily give up anywhere between 2% to 5% of their fees just to shorten the payment cycle (e.g., from NET 60 to NET 30). Those are all voluntary and (1) always something worked out with the consultant and the client, not something imposed by whatever third party “payment processor” hired by the client, and (2) a consultant can always just stick to their contracts’ payment terms and get 100% of what the client pays them.
I have even seen consultants pledging future consulting revenues to banks as collaterals to secure loans from banks and pay interest on such loans that, in a sense, is also a way of giving up a percentage of their revenues (in the form of interest payment) to get their money sooner. But again this would be voluntary as no consultant is required to take out such a loan.
For consultants who accept credit card payments or wire transfers, the consultants choose their payment processors (merchant account providers or banks); and even then the consultants can stick to ACH to avoid paying a percentage of revenue for payment processing.
In the case discussed in the article, the service providers are not the ones choosing the payment processor and the providers are often cheated out of using a fee-less option (the paper check) when it should be available.
Imagine W2 employees have to give up a cut of their salary or wages to some “payment processor” that their employers have hired; the employees will be up in arms.
