The case for cryptocurrency payments in health care

Bitcoin has recently surged past $100,000, marking a pivotal moment in the adoption of cryptocurrency worldwide. Coupled with a regulatory environment under the Trump administration that promises to be more favorable to digital assets, now is the time for medical practices to consider integrating cryptocurrency payments into their operations. This combination of market momentum and policy support offers practices a unique opportunity to attract a broader clientele and improve financial efficiency.

Who stands to benefit most?

Not all medical practices are alike, and some stand to benefit more than others from adopting cryptocurrency. Cash-based outpatient practices, as well as concierge or direct primary care practices—where patients pay a subscription fee for access to more personalized care—can enhance their tech-forward appeal by accepting cryptocurrency payments. Then there’s the rapidly growing field of medical tourism. Patients traveling from countries with volatile fiat currencies or unfavorable exchange rates often find cryptocurrency to be a stable and convenient option. For instance, El Salvador has embraced Bitcoin as legal tender, and in Argentina, where inflation is notoriously high and the U.S. dollar has a myriad of exchange rates that may fluctuate hourly, crypto offers patients a way to bypass financial uncertainty.

Many patients pay with credit cards due to convenience; however, credit card transaction fees of 3 to 5 percent can substantially reduce practice revenue. In contrast, cryptocurrency payment gateways, which will be described further below, may have transaction fees as low as 0.5 percent. In an era of rising inflation and thinner margins on medical care, this slight disparity in fees may keep struggling practices profitable.

The role of smart contracts

One of the most exciting aspects of blockchain technology is the potential of smart contracts. These self-executing contracts are coded directly onto the blockchain, automating transactions and eliminating the need for intermediaries. In health care, smart contracts could streamline billing processes, ensuring that payments are released only after services are rendered. For instance, a telemedicine appointment could automatically trigger payment upon completion, saving time and reducing disputes.

Smart contracts can also enhance compliance by embedding legal and regulatory requirements directly into the transaction, ensuring security and trust. While their implementation requires technical expertise, the benefits of transparency and efficiency are well worth the effort. For practices embracing cryptocurrency, smart contracts represent an additional layer of innovation and functionality.

How to get started?

Although it is technically possible for patients to pay directly from their crypto wallet to a crypto wallet owned by the medical practice (thereby avoiding any transaction fees), these direct transactions are highly error-prone and not recommended. Therefore, to accept cryptocurrency, practices should instead utilize crypto payment gateways. These are digital platforms similar to credit card payment processors that act as a bridge between the customer’s crypto wallet and the merchant’s (in this case, the medical practice’s) bank account, and add layers of security to each transaction. Payment gateways can reduce price volatility as they often lock in an exchange rate for a certain period during which patients can complete their transactions.

When the payment is received, the merchant can decide whether to hold the payment in crypto or convert it back to a traditional fiat currency. There are a variety of payment gateways that exist, each with its own transaction fees and cryptocurrencies that it supports. Some platforms reduce or waive transaction fees for elite members; practices that seek to use a substantial amount of crypto transactions may consider paying for elite status.

In order to get started with accepting crypto payments, a practice manager can follow these steps:

1. Open an account on a crypto exchange platform. It is recommended to use an exchange that is legal and has a good reputation (e.g., Coinbase, Binance) to reduce the risk of fraud.
2. Set up integration with your website or provide in-office QR codes for patient payments.
3. Decide whether to hold payments in cryptocurrency or convert them to fiat currency to avoid volatility.
4. Train staff to manage transactions and track payments using the platform’s dashboard.

Many payment gateways, such as Coinbase and PayPal, allow for easy app-based payment methods, which can further streamline the process for both patients and practices.

Choosing the right crypto coins

Just as there are pros and cons to accepting cryptocurrency overall, each specific crypto coin has its own advantages and drawbacks. One of the biggest challenges in the cryptocurrency space is the prevalence of fraudulent currencies that are little more than pyramid schemes. Therefore, this author recommends starting with Bitcoin (BTC) only, as it is the most widely accepted cryptocurrency with the largest market share. Other viable options may include U.S. Dollar Coin (USDC), a currency pegged to the value of the U.S. dollar, as converting USDC to U.S. dollars is relatively straightforward.

However, even the largest cryptocurrencies often experience large fluctuations in value. Patients may have bought Bitcoin for $100,000, only to see its value increase to $120,000 a few hours after they have paid for a procedure using this currency. Patients may be understandably frustrated in these situations. Therefore, it is imperative that practices obtain consent from patients prior to conducting payments in cryptocurrency and ensure that patients understand the potential risks and benefits of this price volatility. After all, it is possible that the value of Bitcoin suddenly drops to $70,000 within a few hours of the transaction, effectively providing the patient a 30 percent discount.

A vision for the future

As cryptocurrency becomes more widely adopted, there is an emerging market for these payment modalities in the health care space. However, cryptocurrency transactions are unlikely to fully replace traditional payment models in the future, and medical practices that accept cryptocurrency should also ensure that their fiat currency infrastructure remains in place for the vast majority of patients. Further research on the percent of health care transactions conducted with cryptocurrency is necessary and can help push the field forward.

Cryptocurrency represents more than just a payment method; it’s a step toward the future of health care finance. By embracing this technology, doctors can modernize their practices, improve patient satisfaction, and streamline operations. Whether you’re a cash-only practice looking to cut costs or a medical tourism provider seeking to expand your reach, cryptocurrency offers a world of possibilities. The key is to start small, stay informed, and remain adaptable as the landscape evolves.

Aamir Hussain is a dermatologist.