Washington Connection, Sept. 14, 2016
Written by: MGMA Government Affairs

New industry guidelines released in effort to curb virtual credit card and EFT abuses

The Workgroup for Electronic Data Interchange (WEDI), a multi-stakeholder group that serves as an advisor to the Department of Health and Human Services, released a new industry resource, Electronic Payments: Guiding Principles, aimed at addressing health plan and vendor payment abuses. Physician practices are experiencing an increase in the use by health plans of “virtual” credit cards (VCCs) and fees associated with claims paid via electronic funds transfer (EFT). The cost to practices can be as high as 5% of the claim amount. MGMA served as the co-chair of the WEDI taskforce that developed the resource.

The principles establish industry best practices with recommendations that include:

  • Before a provider may be paid via an electronic payment method other than EFT (such as a VCC), the provider should give explicit agreement (“opt-in”), be informed about the availability of an EFT payment option, and be notified regarding any fees associated with any payment option. 
  • Health plans, or any of their clearinghouses or payment-related vendors, should offer an EFT payment option with no fees. 
  • Providers should be given a minimum 90-day notice before the effective date of the electronic payment mandate and must opt-in to any nonstandard electronic payment method scheduled to replace a paper-based payment.
  • Providers must give explicit authorization prior to use of the EFT debit transaction by a health plan for recoupment purposes.

For more information on electronic payments, practice rights, and action steps to automate your revenue cycle, access the MGMA member-benefit EFT ERA Guide and sample letter requesting EFT.


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