It has never been easier or more advantageous for healthcare providers to utilize automated payment systems like EFT. While implementing new methods of payment may seem overwhelming, it is actually a very simple process that offers many benefits to you and your practice.
What are EFT Payments?
An electronic funds transfer (EFT) payment is a direct claim payment transferred electronically into a designated bank account and offers many benefits to healthcare providers. The term EFT refers to the application of computer technology to make and process payments, using electronic networks instead of cash or checks to conduct a transaction.
Why should you consider EFT payments?
Simply put, adopting EFT payments can save healthcare providers time and money. The Council for Affordable Quality Healthcare (CAQH) has reported that providers alone could save about $7.9 billion annually by switching to automated claims management processes, including EFTs.
According to the CAQH, manual claims management processes cost providers roughly $4 more than equivalent electronic transactions, with claims reimbursement representing a major opportunity for savings. Electronic claims reimbursement cost providers $2.20 less per transaction compared to a manual payment.
EFT systems minimize the time spent waiting for payments to arrive and can improve cash flow management. Since EFT payments are posted faster than traditional check payments, the funds are available sooner. This means providers can decrease bank deposit holds and eliminate lockbox service fees. Direct electronic payments also involve less paperwork, lowering administrative costs– and they’re better for the environment.
EFT systems allow payments to be electronically tracked and recorded confidentially and securely. This means less risk of theft or errors, with no manual processing or handling to deposit. EFT systems often provide Explanations of Review (EORs), sent electronically and containing all the information needed to apply the payment in a financial accounting system. In most cases, EORs can be delivered within as little as one business day of the funds posting to an account.
While implementing new methods of payment may seem overwhelming, getting set up for EFT is simple. Simply reach out to your payment processor for the necessary form, identify which checking account you want the funds deposited to, and provide the following account information: The name of the financial institution, account number and routing number.
In today’s increasingly contactless world, the numerous benefits for healthcare providers accepting direct electronic payments far outweigh any potential processing worries or implementation concerns. So why wait? If you’re not already accepting EFT, it may be time to contact or reconsider your payment processor, and start saving time and money on your business’s accounting practices today.