If you accept credit cards in your health or wellness practice, you are paying a processing fee on every transaction. What most practice owners don’t know is that there are two fundamentally different ways those fees can be structured — and one of them almost always costs more.
Flat-Rate Pricing: Simple, but Expensive
Flat-rate processors like Square, Stripe, and Mindbody Payments charge one percentage across every transaction — typically 2.6% to 2.9%. It’s easy to understand, which is why it’s popular with new businesses. But simple doesn’t mean cheap.
Here’s the problem: Visa and Mastercard publish their actual interchange rates — the underlying cost to process a card. Rewards cards, corporate cards, and debit cards all have different rates. Some cost as little as 0.05%. Others cost 2.1%. On average, most retail interchange sits around 1.5–1.8%.
When a processor charges you a flat 2.75%, they’re pocketing the difference between 2.75% and whatever the actual interchange cost was. On a debit card transaction where interchange is 0.5%, that’s a significant margin going to your processor — not you.
Interchange-Plus Pricing: Transparent by Design
Interchange-plus (also called cost-plus) pricing works differently. You pay the actual interchange rate — whatever Visa or Mastercard charges — plus a fixed markup that the processor keeps. That markup is usually somewhere between 0.2% + $0.10 and 0.5% + $0.15, depending on your volume and processor.
Your statement shows exactly what each card type cost, and what your processor earned. Nothing is hidden in the spread.
For a med spa, plastic surgery practice, or wellness clinic processing $50,000 to $200,000 per month, the difference between flat-rate and interchange-plus can easily be $300 to $1,500 per month.
Why Do Flat-Rate Processors Still Exist?
Because they’re easier to sell. “2.75% on everything” is a straightforward pitch. Interchange-plus requires explaining a bit more, which means processors who offer it tend to work with established businesses rather than brand-new ones.
If your practice has been open for more than a year and is processing at least $10,000 per month, you almost certainly qualify for interchange-plus pricing — and you should be on it.
How to Know What You’re Paying Right Now
Pull your most recent processing statement and look for your “effective rate” — total fees divided by total volume. If it’s above 2.4%, you are very likely overpaying, and a statement audit will show you exactly by how much.
At Beacon, we work exclusively with health and wellness practices. A free statement audit shows you your current effective rate, what it would be under interchange-plus pricing, and your estimated monthly savings. Use our pricing calculator to get a ballpark before you even send us a statement.
There is no obligation to switch — but most practices that see the numbers do.