Industry survey commissioned by MediStreams finds fee-based payments are draining millions from healthcare organizations already under financial pressure

MediStreams, a leading healthcare payment and remittance automation solutions provider, today announced the release of new independent research examining the financial and operational impact of virtual credit cards (VCCs) and other fee-based payment programs on healthcare organizations.

The study reveals that what are often marketed as “convenient” electronic payment alternatives to paper checks are, in reality, quietly eroding margins, increasing administrative burden, and undermining financial visibility across the healthcare revenue cycle. Commissioned by MediStreams and conducted by independent research firm, In90group Research, the industry research surveyed more than 100 healthcare finance and revenue cycle leaders representing hospitals, health systems, physician groups, and specialty providers nationwide.

The research report, titled Paying to Get Paid: How Virtual Card Fees Erode Healthcare Margins, includes a detailed summary of the findings, and it can be downloaded for free on the MediStreams website.

Key Findings Highlight a Growing Industry Problem

The research confirms that fee-based reimbursement is no longer an edge case. It is rapidly becoming standard practice across healthcare providers:

• 81% of healthcare organizations currently or recently received reimbursements through virtual credit cards or other fee-based payment programs
• 80% report that at least 5% of their total reimbursement revenue is subject to these fees, with 54% of providers typically paying 3–5% or more per VCC transaction
• 61% say the use of VCCs has increased in the past two years, and 67% expect it to rise further over the next 1-2 years
• 83% of respondents call it urgent or very urgent to implement a solution that eliminates these fees

For large health systems, these percentages can translate into millions of dollars in lost reimbursement each year — revenue that could otherwise support staffing, technology investment, or patient care.

“Virtual credit cards have quietly become one of the most expensive ways for healthcare organizations to get paid,” said Joe Maher, President of MediStreams. “At a time when providers are facing cost pressure from every direction, losing 3–5% of earned reimbursement to payment fees is simply not sustainable.”

Beyond the direct financial impact, respondents cited significant downstream effects. Leaders report increased administrative workload, difficulty forecasting revenue, reduced confidence in reported net revenue, and longer month-end close cycles as teams reconcile variable card deposits and opaque deductions.

Why Providers Feel Trapped

The study also sheds light on why fee-based payments persist despite widespread dissatisfaction. According to the research, many organizations report accepting VCCs not by choice, but by necessity:

• 64% accept fee-based payments to accelerate revenue collection despite the cost
• 49% lack the capacity to manage the manual workload required to opt out
• 31% say their organization accepted VCCs accidentally, often through a single enrollment action
• 55% describe the opt-out process as very difficult or say they have not yet attempted it

When providers do attempt to avoid fees, payers frequently revert to paper checks or PDF remittances, forcing organizations to choose between paying fees and absorbing more manual work.

“For many healthcare organizations, the alternative of taking paper checks through their medical lockbox and manually posting and reconciling these payments is not an option, given today’s staffing constraints and cash flow urgency,” added Maher.

A Path Forward Without Slowing Cash

While the research highlights the scope of the problem, it also points to a clear opportunity. Healthcare organizations do not need to choose between staying electronic and protecting their margins.

Purpose-built healthcare payment automation makes it possible to remain fully digital, avoid fee-based payment models, and maintain fast, accurate posting and reconciliation. MediStreams helps organizations do exactly that by automating complex remittance workflows, converting paper and PDF EOBs into posting-ready data, and providing full visibility across every payment source.

According to Maher, “Healthcare providers shouldn’t have to pay to get paid. With the right automation in place, like that offered by MediStreams, organizations can eliminate unnecessary fees, reduce manual effort, and regain control over how they receive and reconcile payments — without slowing cash flow. “

Download the Full Research Report

The full research report provides detailed analysis, data, and practical guidance for healthcare leaders seeking to understand the true cost of virtual credit cards — and how organizations are addressing the issue today. Download the report for free on the MediStreams website.

About MediStreams

MediStreams is a premier provider of healthcare payment and remittance automation solutions for hundreds of healthcare organizations nationwide. Purpose-built for the complexity of healthcare payments, MediStreams ingests remittance data from any source — including lockbox, PDF, and EDI — and converts it into standardized, posting-ready outputs with speed and accuracy.

Healthcare providers, clearinghouses, and financial institutions trust MediStreams to automate manual processes, accelerate reconciliation, protect margins, and deliver premium-level customer support across even the most complex payment environments. To learn more about MediStreams visit www.medistreams.com or follow us on LinkedIn.

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“VCCs have quietly become one of the most expensive ways for providers to get paid. When they are facing cost pressure from every direction, losing 3–5% of earned reimbursement to payment fees is simply not sustainable." Joe Maher, MediStreams President