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MasterCard Inc. is extending an agreement to provide payment cards for health accounts managed by UnitedHealth Group's OptumHealth Inc. The deal strengthens the Purchase, N.Y., card company's foothold in the growing health payment space, observers say. MasterCard described the deal as a multi-year contract extension but did not specify its length. Under the agreement, MasterCard will provide cards for health savings accounts, flexible spending accounts and health reimbursement accounts for OptumHealth, including accounts used by members of UnitedHealth Group's medical carrier UnitedHealthcare Services Inc. Members can use the cards for copayments, prescriptions and other eligible medical expenses. "Today's payments opportunities lie in encouraging the use of electronic payments for health care," says Jennifer Vanderwall, MasterCard's senior business leader for healthcare solution. Because of UnitedHealth's size, this extension is "clearly a very large win for MasterCard and a very important relationship for us." Patients are looking for more payment options for their health care costs as more of those costs become their responsibility. In addition, because it is not always possible to determine patients' exact out-of-pocket costs for certain procedures at the time of their visits, "opportunities exist around payments at the point of service and also post-service payments," Vanderwall says. MasterCard's products can be used to access health accounts in either situation, she says. Kunal Pandya, a senior analyst at Aite Group LLC of Boston, says the deal comes at a time when there is still plenty of room for growth in the use of cards for health care payments. Today, "about 30% of providers in the market don't accept cards because they don't have the system to support that," says Pandya. These providers "want to introduce some kind of payment card" to cut down on the bad debt associated with other payment types, such as checks. Pandya says that card acceptance systems can assure health care providers that the funds are available to cover out-of-pocket expenses incurred by patients. "MasterCard has been working in this space for a long time," he says, and this contract extension with OptumHealth furthers its work in promoting payment cards in health care.
