PulseCard, of Overland Park, Kan., has struck a deal with the American Medical Association to provide credit card processing for member doctors and dentists.

'Under what is called the AMA-sponsored Card Acceptance Program, PulseCard will process MasterCard, Visa, and American Express payments.

Dr. Robin Potter, who founded PulseCard in 1989 to provide health care transaction services, said the company does not have a relationship with any issuer and thus isn't tied to any one product.

He said the alliance of PulseCard and an AMA affiliate, AMA Financing and Practice Services Inc., announced last week, is intended to encourage credit card acceptance in the medical field. Individual doctors are said to run 74% of all medical and dental practices.

Asked why solo practitioners would want to accept credit cards, Dr. Potter said they lose about 8% of their revenues annually to bad debt. Billing costs are also substantial.

Credit cards, he said, would improve a practice's cash flow enough to offset whatever transaction fees apply.

"I saw the need and found a way to fill it," he said. "The solo practitioner is not generally a profitable prospect for banks or credit card processing companies."

Dr. Potter said the AMA connection gives his company credibility as it seeks a role in the automation and streamlining of medical payments. The reform and reengineering of health care also has numerous banks and transaction processors seeking out business opportunities, and the major card companies have viewed the market as a new frontier for card acceptance.

A spokeswoman for Visa said the participation of Visa, MasterCard, and American Express "would probably increase the trend towards credit card usage and an improved number of payment options."

Gary Grosso, vice president of health care marketing at MasterCard International, said "we're all for wider acceptance" of credit cards. He said "one-third of all consumers are not able to get the health care they need due to financial hardship" and many could get help if they were able to use credit cards.

He estimated the health care market at about $1 trillion annually. Of this, about $200 billion comes out of consumers' pockets, and credit cards are used in 10% to 12% of the expenditures.

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