What Payment System Should You Use for Private Pay Clients?
Let me start by saying that this is not a comprehensive list and if you were to conduct your own in-depth research, you might be able to find a payment system that better suits your needs as a business. However, since I do get a lot of questions about how to take payments from Private Pay clients, I wanted to review the benefits of some of the more popular systems on the market for Therapy Businesses.
I reviewed these systems with a few factors in mind including Set-up Cost, Monthly fees (if any), Transaction fees, Mobility, and benefits of scale. I put together a neat chart for you at the bottom of the article so you can compare for yourself. My findings surprised me and will certainly impact how I advise my clients moving forward. Let’s jump in and see what the major benefits and drawbacks are for each system.
Benefits: Square has a very low set-up cost of only $10 per reader unit and they are the smallest of the systems I reviewed, neatly packable into your pocket. Sometimes you can even get your first reader for free from Square which makes it no cost to set up and start making money.
Drawbacks: The biggest drawback to Square is the transaction cost. They have the highest transaction cost of the systems I reviewed at 2.75% per transaction.
When should you use this system? The reason I would use this system over the others I reviewed is if I wanted something that wouldn’t cost me much to set up. If I were only doing a few transactions a month and didn’t mind a little bit of a higher fee, this would be my go-to system; not to mention it has a really great interface and user experience.
Benefits: Clover provides the device but you are free to partner with any outside group to handle transactions. This is a huge benefit because this means you can partner with groups like Dharma and pay as little as $0.99 per transaction.
Drawbacks: Since Clover only provides the device it would make sense that the device cost is much higher than competitors. At $99 per device, you’ll have to be prepared to make a bigger investment up front to get more cost savings down the line.
When should you use this system? I would use this system if you’ve saved a bit of money for up-front costs and if you’re going to be doing more than 50 transactions per month. The cost savings of this system really start to pay as you do more transactions.
Benefits: Similar benefits to Square in that the device cost is very low but the transaction cost is actually just a bit lower than Square at 2.7%. However, unlike most solutions you can access your funds in minutes after the transaction.
Drawbacks: PayPal’s system falls right in the middle with no real advantage at any number of transactions. It is a good solution and competitive at all levels but nothing really puts it over the top in any category I analyzed.
When should you use this system? I would use this system if I needed quick access to funds and if I managed the majority of my business through the PayPal platform.
Benefits: Intuit has a lower transaction cost than both PayPal and Square which is ideal if you’re only doing a few transactions per month. The device is also affordable at $30 per device so once you pay for one device (or obtain one for free), your transaction cost is pretty low.
Drawbacks: The cost stays relatively low as you scale transactions but your additional equipment costs will be higher than Square and PayPal if you add additional devices.
When should you use this system? I would use this system if I could obtain my initial device for free and if I were only preforming 10 or less transactions per month.
Benefits: If you use Clinic Source as an Electronic Health Record and Billing system, this will make it very easy for your office staff to bill patients for every single visit.
Drawbacks: It doesn’t have a mobile swiping capability but that doesn’t really matter if your office staff is monitoring all visits and billing each transaction. Clinic Source also has very high monthly fees ($38/mos) as compared to the other systems on this list.
When should you use this system? I would only use this system if you use Clinic Source as your billing system and if you perform more than 100 private payment transactions per month. It only becomes cost effective at scale and even then it’s only moderately cost effective. The biggest convenience is that your office staff can handle the transactions and you take it out of the hands of your therapists, which can be a huge burden off their shoulders.
Each business situation calls for an analysis to determine which system would benefit you the most. I can tell you that my clients all use different systems so there is no perfect solution; only the perfect one for you. My analysis is based on simple factors that most of my clients would analyze but surely there are more drawbacks and benefits to each system based on your business needs so I always encourage you to explore further.