Monthly Payment Surcharge Calculation: A Guide for Your Practice
We know that managing membership payment plans for your patients is an essential part of your practice’s success. This guide is designed to simplify the process, providing clear steps to calculate and apply surcharges and enrollment fees for monthly membership payment plans.
Monthly Payment Structure ✅
Monthly Payment Structure
Base Calculation Formula
The monthly payment amount is calculated using the following formula:
🔢 Monthly Payment = Annual Fee ÷ 12 × (1 + Surcharge Percentage)
Example Calculation
For an annual fee of $500 with a 20% surcharge:
- Base monthly amount = $500 ÷ 12 = $41.67
- With 20% surcharge = $41.67 × 1.20 = $49.00
Implementation Process ✅
Setting Up Monthly Payments
- Select the monthly plan option.
- Enter the pre-calculated monthly amount (includes surcharge).
- Verify recurring payment plan selection.
- Add enrollment fee if applicable.
Payment Structure Example
- Initial Payment: Monthly fee + Enrollment fee
- Subsequent Payments: Monthly fee only
Fee Components ✅
Optional Charges:
- Enrollment Fee (one-time)
- Monthly Surcharge (recurring)
Example Payment Breakdown
With $99 enrollment fee and $49 monthly payment:
- First Month: $148 ($99 + $49)
- Following Months: $49
Best Practices ✅
Communicating with Patients
Present the monthly payment option as a convenience service, explaining:
- The annual fee concept.
- Monthly payment as a flexible alternative.
- Surcharge as a convenience fee for monthly processing.
Payment Processing
- All monthly plans require automatic recurring payments.
- Payment information must be collected during enrollment.
- System automatically processes recurring charges.