Insurance Pays with Virtual Credit Card

In some cases, insurance companies contract with an outside party to pay their providers via a virtual credit card. Insurance companies do this because they make a bit of money off of the credit card processing fees that are incurred and paid by you.

Essentially, the insurance company is saying "we would like to pay you 3% to 5% less for your work, okay?" when asking a user to accept this form of payment. This is the amount of the transaction fee that your credit card company is going to charge a user to process this payment. It saves the insurance company some money (they don't have to mail a check), but is literally at your expense.


Our recommendation is NOT to accept these types of payments.


If you do, however, decide to accept a virtual credit card from an insurance company, use the following process:

Warning: Running the virtual card through TherapyAppointment will cause the insurance payment to show as a Client Payment. This will cause you to have inaccurate accounting for your clients.

  1. Instead, run them through your credit card processor's virtual portal.
    This may be with Global Payments/TSYS or International Bancard. Each of these systems provides you with a username/login to use to directly access their terminal.
  2. After processing the payment, enter the payment by using the Enter an EOB process.
    Article: Enter an EOB
Note: More and more companies are starting to pay in this way but fortunately, they cannot force users to accept this form of payment. TherapyAppointment suggests their users refuse to accept payments by virtual credit card, going forward.

Below are some of the most common Virtual Credit Card Payment systems used by insurance companies and links to their website where instructions about switching to a different payment type are available. If you receive virtual credit cards from these vendors, you can request that they send you either a paper check or direct deposit.

Be aware that in some cases, them setting up direct deposit may incur a fee. However, the convenience of direct deposit and e-delivery of the ERA file may be worth the fee that they are charging, which seems to be around 2%.

It might help to complain to the insurance company's provider relations department about these practices: You should not have to 'pay' to get paid for your services.