As organizations look to migrate costly check disbursements to electronic payments, the adoption of virtual card payments is gaining in popularity.
Virtual cards are single-use, unique card numbers with fixed credit limits that are set based on a given company’s payment instructions. Companies can use virtual cards in lieu of paper checks to securely pay invoices and A/P disbursements either online or over the phone.
No hidden costs
Virtual cards have the ability to save costs because they are just that…virtual. That means EOBs, payment details, and an other paperwork can be potentially transmitted electronically, meaning there are no print or mail costs. If you could replace even 50% of your checks, companies see as much as a 75% reduction in print and mail costs. There are no transaction fees, licensing fees or setup fees.
What this means is an immediate reduction in your cost per transaction. If you were to compare these costs to other payment transaction method An EFT can run as little as 17 cents or as high as $35 for wire transfers. While $.17 does not sounds like much, multiple that cost for every transaction. Paper checks cost around $1.68 for labor, postage printing and other costs. ACH will typically run ten to twenty cents each. Virtual cards do not carry any cost and therefore provide immediate return on investment.
Minimal implementation risk
Simplicity of integration allows for streamlining of the claims settlement process, which means you and your team are much more efficient and can reduce your overall implementation, labor, and integration costs.
- There is no enterprise service bus required to integrate with other systems.
- No special payment file is needed. Typically current, standard output files can be used.
- A no-cost transaction that results in an ROI measured in weeks, not months, or years.
- Some virtual card suppliers even do the implmentation for you, which enables end-to-end claims processing without tying up IT department resources.
No cost 1099 reporting & escheatment services required
- Many virtual card suppliers do not charge for 1099 reporting
- Escheat fees can cost an average of $50.00 per abandoned account. Virtual cards do not require escheatment services because xxx
- Allows you to utilize technology to prevent labor intensive zero pays, stop-pays and reissues
Reduce your print and mail costs
Eliminate unnecessary administrative costs that are required for payers and providers to process paper-based healthcare claims payments. Up to 70% of provider print and mailing costs are unnecessary in the electronic age. Easily convert your paper check payments to electronic using existing card processing networks.
Organizations can use their existing point of service terminals to enter payment information and electronically route payments using existing card networks. Funds are then deposited into the provider’s existing merchant account.
No enrollment required. No associated cost to print and mail the payment information.