Telehealth is redefining how people receive healthcare, but that doesn’t mean every part of the digital experience has caught up.
When an industry shifts as quickly as telehealth, it’s hard for every related service to stay aligned. The regulations that govern these systems are complex and slow-moving, designed to protect patients and the companies that serve them. But when those companies evolve faster than the laws, the systems that support them, including payment processors, also have to evolve.
Telehealth is one of the most complex industries for processors to navigate. Trust is everything when it comes to patients and their providers, and that trust extends to payment systems. Between insurance claims, sensitive data, and constant regulatory change, processors need to stay current or risk leaving telehealth companies exposed.
Subscription models, hybrid insurance payments, and direct pay all demand flexibility. If processors can’t keep up, telehealth companies are forced to look elsewhere.
Telehealth keeps moving forward, but payments are struggling to catch up.
Why Some Payment Processors Can’t Catch Up to Telehealth
The real obstacle for payment processors in telehealth isn’t technology, it’s expertise.
While processors already handle regulated and subscription-based industries, telehealth adds layers of complexity that most aren’t built for. Handling insurance disputes, navigating state medical laws, and maintaining HIPAA compliance simultaneously is far beyond what standard payment infrastructure can manage.
When processors misstep, the cost isn’t just lost business; it’s regulatory penalties, patient mistrust, and potential licensing issues. Many processors also misclassify telehealth as “high-risk,” simply because it’s easier than understanding it. That single label can trigger higher fees, withheld funds, and frozen accounts.
Then there’s the chargeback issue. In e-commerce, proof of delivery is simple. In telehealth, it’s intangible. Virtual consultations or therapy sessions lack concrete proof, making it harder to verify the legitimacy of the service and easier for disputes to succeed.
The Hidden Challenges in Telehealth Payments
Most patients never see the behind-the-scenes challenges of telehealth payments, but they’re exactly what keep processors from supporting the industry confidently.
High Chargeback Risk
Telehealth services are non-physical and difficult to prove. If a patient disputes a charge, processors often side with the cardholder. “Proof of service” is subjective, and that ambiguity leaves providers exposed.
Payment Parity
Payment parity ensures that virtual and in-person visits are paid equally. But not all insurers agree. Many argue that telehealth services should cost less, and while some states enforce “coverage parity,” few require equal reimbursement. The result: inconsistent and often lower payments.
Constantly Changing Regulations & Compliance Issues
Healthcare is one of the most regulated industries in the world — and telehealth multiplies that complexity. Federal and state laws vary, and updates happen constantly. Falling behind even slightly can mean compliance violations, fines, or shutdowns.
Complex Policies
Every insurer, state, and healthcare network has different rules for telehealth coverage and reimbursement. What’s billable in one region might not be in another. HIPAA, PCI DSS, and state-level privacy standards don’t always align, forcing companies to navigate conflicting requirements. Without specialized systems, even compliant businesses can appear unstable to banks and processors.
Identity Verification Issues
In telehealth, every interaction happens remotely. Without in-person ID checks, verifying who’s behind a transaction becomes difficult. Fraudsters exploit this with stolen cards, synthetic identities, or falsified patient data. Just one successful breach can lead to cascading losses.
Exposure to Complex Fraud
Fraud evolves faster than most processors can respond. Telehealth payments face risks like:
- Prescription fraud: Obtaining drugs through fake consultations.
- Account takeovers: Stolen logins or payment info.
- Dispute farming and chargeback laundering: Coordinated refund abuse.
- Subscription and refund scams: Exploiting lenient cancellation policies.
Without a processor equipped to detect these patterns, telehealth companies are easy targets.
Insurance Claim Denials
When care is harder to verify, insurers have more excuses to deny claims. Even well-documented telehealth sessions can be rejected, creating cash flow gaps and operational uncertainty.
How Telehealth Companies Can Avoid These Challenges
Processing pain isn’t inevitable; it’s actually preventable. With the right approach, telehealth companies can strengthen compliance, reduce fraud, and stabilize revenue.
LegitScript Certification
LegitScript is critical in telehealth. It verifies that providers operate legally, ethically, and in compliance with healthcare and pharmacy regulations, which helps protect patients from unsafe or fraudulent care. It builds trust with security.
Build Strict Term Pages for Chargebacks and Refunds
Your terms are your first line of defense. Outline every detail of your services and refund conditions to close loopholes that fraudsters exploit. Transparent, thorough terms make chargeback rebuttals far easier to win.
Utilize Every Available Fraud Prevention Tool
Fraud prevention isn’t passive. Use AI-driven fraud analytics, device fingerprinting, ID verification, multi-factor authentication, and blacklist databases. Every layer adds protection.
Ensure HIPAA Compliance Wherever Applicable
HIPAA isn’t optional. Every digital touchpoint, including consultations, billing, storage, and payments, has to meet HIPAA standards. Compliance doesn’t just protect patients; it protects your business from liability.
Vet Your Payment Processing Partner
Not every processor understands telehealth, and many don’t want to. A true partner should proactively protect your transactions, not just process them. Work with one that views compliance, security, and stability as part of its core service, and not add-ons.
Finding an Ideal Telehealth Processing Partner
Your payment processor should be more than a service provider; it should be your ally.
Every regulation, risk, and transaction tied to your business should matter just as much to your processor as it does to you. You don’t want a hands-off processor that leaves you to navigate all the complications by yourself. Luqra is built differently.
Our systems are designed to help you understand your payments, your compliance, and your patients, all in one place. We embrace HIPAA, adapt to shifting regulations, and evolve alongside your business.
With Luqra, you get:
- Optimization for telehealth, with deep expertise in compliance and risk.
- Higher approval rates and proactive monitoring.
- 24/7 US-based support from experienced payment specialists.
- Scalable processing that grows without freezes or disruptions.
Your telehealth company needs more than a payment system; it needs a guide. Meet Luqra.
