Most Americans prefer the convenience of direct deposit for their paychecks. However, imagine if your employer deducted a 2-5% fee from each paycheck to cover the cost of electronic payments. While it seems absurd, this is the reality for many doctors in the U.S. Healthcare insurers and their payment processors often impose hidden EFT fees on electronic fund transfers (EFTs).
These “convenience penalties” increase administrative burdens and reduce doctors’ already slim profit margins. These fees serve no purpose other than to enrich the middlemen who collect them.
Impact of Affordable Care Act Changes on Electronic Payments in Healthcare Billing
The Affordable Care Act mandated that health insurers offer doctors standardized electronic payments to streamline billing and reduce healthcare costs. This was reinforced by CMS regulations in 2017, prohibiting insurers from charging fees for electronic reimbursements.
However, due to intense lobbying by the insurance industry, these regulations were dropped, allowing insurers to charge up to 5% per transaction for electronic payments. This has forced many doctors to accept these fees, even when they prefer paper checks.
Hidden EFT Fees Burdening Physician Practices Amid Declining Reimbursements
A survey by the Medical Group Management Association (MGMA) revealed that almost 60% of physician practices were charged hidden EFT fees without their consent. Additionally, the MGMA reported that two-thirds of practices receive over 75% of their annual revenue through EFT payments.
These fees can be substantial, reaching $1 million or more for larger practices and up to $100,000 for smaller ones. This money could be better utilized to enhance patient care, hire additional staff, or expand community services.
America’s healthcare providers are struggling under the weight of declining reimbursements that do not cover the actual cost of patient care. This is due, in part, to outdated payment systems that have failed to keep up with inflation. As a result, many practices, especially in rural and underserved areas, are facing financial hardship and may be forced to close their doors.
No Fees for EFTs: A Must-Pass Bill for Patient Care
To address this urgent issue, Congress must pass the No Fees for EFTs Act (HR 6487), which would prohibit insurers from charging healthcare providers fees for electronic payments. This legislation is crucial to protecting physician practices and ensuring continued access to care for patients.
In addition to passing this bill, Congress must also reform the Medicare physician payment system to provide adequate reimbursement rates. By taking these steps, lawmakers can help stabilize physician practices across the country and safeguard patient care
The healthcare system is facing a crisis due to the increasing costs of medical care and decreasing Medicare reimbursements. Many doctors and practices are struggling to stay afloat, and the situation is unsustainable in the long run. Insurance companies are taking a significant portion of the revenue for services that should be free, further straining the system. Hidden EFT fees are contributing to the financial burden on practices. Congress needs to pass the No Fees for EFTs Act to prevent practices from closing and ensure patients continue to receive quality care.
EFT: A Game-Changer for RCM Company:
Electronic Funds Transfer (EFT) has significantly impacted Revenue Cycle Management (RCM) companies, including Allzone Management Services, in several ways. It has streamlined the payment process, reducing the time and costs associated with traditional methods like checks. EFT allows for faster payment processing, improving cash flow and reducing the risk of late payments. Additionally, EFT reduces errors and fraud, as it eliminates the need for manual data entry and physical handling of checks.
Improved Payment Rates: The Impact of EFT on RCM
EFT has also enabled RCM company to offer more convenient payment options to patients. Patients can now pay their bills online, through mobile apps, or by phone, making it easier for them to settle their accounts. This convenience has led to increased patient satisfaction and improved payment rates.
Improving Efficiency: The EFT Advantage
Moreover, EFT has facilitated the integration of payment systems with other healthcare software, such as electronic health records (EHRs) and practice management systems. This integration streamlines the entire billing process, reducing administrative burdens and improving efficiency.
Overall, EFT has been a game-changer for Revenue Cycle Management Company like Allzone MS. It has improved payment processing speed, reduced costs, enhanced patient convenience, and facilitated system integration. By embracing EFT, Our RCM Company can optimize their operations, improve their financial performance, and provide better services to their clients.