8071 Medical and dental laboratories

Introduction

• What it is: This MCC covers businesses providing laboratory services for medical and dental purposes.
• Risk level: Medium — Due to the sensitivity of health-related data and potential liabilities.
• Acceptance difficulty: Medium — Banks may require additional documentation due to the nature of services.
• Typical business models: medical laboratories; dental laboratories; clinical testing facilities; blood banks.
• For merchants: Potential higher MDR; may require liquidity reserves; varied approval times based on service type.
• What PSPs expect: Comprehensive business details; proof of certifications or accreditations; clear service agreements.

Payment Insights & Benchmarks

Merchants in this MCC should anticipate a unique payment landscape influenced by the nature of healthcare transactions. The acceptance of various payment methods may vary due to patient demographics and industry regulations.

Payment methods

Cards: commonly used, but may face higher rejection rates due to potential fraud concerns related to healthcare transactions.

• Insurance billing: significant for many transactions, impacting cash flow and payment timelines.
• E-wallets: gaining traction for patient convenience but not universally accepted.
• Payment plans: often utilized for larger medical expenses, requiring robust invoicing and follow-up processes.

Authentication & security

Strong customer authentication (3DS, SCA) is often necessary to align with healthcare regulations.

• These security measures can enhance approval rates but may also cause friction during the payment process.
• Fraud prevention is critical, as healthcare payments can be targets for fraudsters exploiting sensitive information.

Benchmarks (indicative, not guaranteed)

MDR: typically higher than standard e-commerce due to the specialized nature of services provided.

• Rolling reserves: may be assessed based on risk factors associated with chargebacks and payment disputes.
• Settlement times: often longer; could exceed standard e-commerce timelines due to insurance processing.
• Chargeback ratios: potentially elevated due to disputes over service delivery and patient expectations.
• Approval rates: often lower than average due to the scrutiny in medical billing and payment verification.

Key metrics to monitor

Authorization rates segmented by payment types (insurance, card, etc.).

• Chargeback reasons, particularly focusing on service-related disputes.
• Trends in payment delays linked to insurance claims processing.
• Average transaction value and patient payment behavior patterns.

Risk & Compliance

Merchants operating under MCC 8071 (Medical and Dental Laboratories) face significant scrutiny due to the sensitive nature of healthcare transactions and the potential for fraud. PSPs and acquirers implement stringent checks to mitigate financial and reputational risks tied to fraud, chargebacks, and compliance with AML/KYC regulations.

Chargebacks & fraud

Common forms of fraud include friendly fraud related to denial of services rendered and misuse of insurance information.

• Instances of billing for services not provided or inflated billing can lead to disputes and customer complaints.
• Mitigation tools such as transaction monitoring systems, velocity checks, and advanced analytics help to detect unusual patterns and prevent fraud.

AML/KYC expectations

Rigorous identity verification is crucial, including government-issued ID checks and validation against sanction lists.

• PSPs expect clear documentation of the source of funds, especially for high-value medical procedures.
• Manual review triggers include frequent high-value transactions, patterns indicative of potential money laundering (e.g., structuring), and the use of foreign payment methods.

Operational red flags

Transparency gaps, such as unclear ownership of the laboratory or hidden operators, can raise concerns for PSPs.

• Lack of documented procedures for handling patient data and safeguarding sensitive health information may alarm acquirers.
• Inadequate communication about the services offered and any related costs can lead to customer disputes and increased chargebacks.
• Absence of a formal grievance handling process for clients to address dissatisfaction or disputes related to services.

Onboarding Checklist

Merchants in the Medical and Dental Laboratories sector must ensure they have a comprehensive onboarding package ready for review by PSPs or acquirers. This preparation is crucial to enhance the chances of approval and facilitate a smooth onboarding experience.

Legal & corporate documents

company registration and incorporation documents

• disclosure of beneficial owners (UBO) and corporate structure
• valid licenses for laboratory operations and health-related services
• policies: Terms of Service, Privacy, AML/KYC, Refund Policy

Financials & risk management

recent financial statements and cashflow forecasts

• liquidity or reserve model for managing operational costs
• description of antifraud setup and risk mitigation strategies

Product & marketing

demo access or screenshots of the laboratory's services platform

• overview of marketing strategies and traffic sources
• information on geographic service area and targeted demographics

Technical integration & security

overview of payment architecture and supported transactions

• description of security measures in place for patient data protection
• PCI DSS compliance status and data storage policy

Operations

customer support framework (availability, languages, and response times)

• SLA for service issues and dispute resolution
• internal processes for handling patient data and ensuring compliance
• protocols for managing chargebacks and refunds

Regulation & Licensing

Licensing and certification are essential for merchants in the Medical and Dental Laboratories MCC, as these credentials ensure compliance with health regulations and standards. License recognition by PSPs depends significantly on the merchant’s jurisdiction and the specific healthcare markets they serve.

Operator licenses

Clinical Laboratory Improvement Amendments (CLIA) — required for laboratories operating in the US to ensure quality standards are met.

• State-specific laboratory licenses — many states issue licenses that are mandatory for operating within their jurisdiction.
• Joint Commission Accreditation — recognized for laboratories that seek accreditation in healthcare settings, enhancing credibility.
• College of American Pathologists (CAP) accreditation — often respected for laboratories specializing in pathology.
• In the EU, compliance with In Vitro Diagnostic Regulation (IVDR) is necessary for laboratories offering diagnostic testing.

Geo-restrictions

Laboratories must adhere to regional health regulations which can vary significantly by country, affecting service delivery.

• Some jurisdictions may require specific licensing only to operate within that area, limiting cross-border services.
• Many PSPs may refuse to onboard labs with licenses from regions not recognized or considered high-risk.

Certifications & audits

PCI DSS compliance, particularly for handling payment card information in billing processes.

• ISO 15189 accreditation for medical laboratories demonstrating quality and competence in testing.
• Regular audits for compliance with HIPAA regulations concerning patient data security in the US.
• Ongoing quality assurance reviews to maintain laboratory accreditation standards.

Official Definitions & Network Comparisons

This section shows how major card networks define this MCC and highlights practical differences that affect merchant onboarding.

Explanation:

While the definitions are generally aligned across networks, terms like "processing labs" versus "laboratory operations" can emphasize different aspects of the services provided. Acceptance policies often require proof of proper licensing and adherence to industry standards. Common reasons for denial may include inadequate documentation, lack of licensure, or concerns over service quality.

Alternative MCC Codes

Merchants often confuse this MCC with other categories. The table below shows which codes are related, why they are confused, and what risks misclassification brings.

Rule of thumb for merchants:

If your business primarily provides laboratory testing and analysis, ensure you classify correctly under MCC 8071. Avoid using other codes that could misrepresent your services, as this can lead to compliance issues and potential penalties.

Best Practices for Merchants

Merchants in the Medical and Dental Laboratories MCC must ensure compliance and operational efficiency to enhance payment acceptance and minimize disputes. Following the best practices outlined below can lead to better financial outcomes and stronger relationships with payment service providers.

Classification & transparency

always use the correct MCC to avoid compliance issues and account closures

• clearly outline business services, practices, and terms on your website
• maintain transparent billing descriptors to ensure customers recognize transactions

Fraud & chargeback reduction

implement 3DS or step-up authentication for transactions that trigger high-risk criteria

• use clear billing descriptors and provide instant confirmations via email or SMS
• maintain thorough transaction logging to aid in managing disputes and representments

Payment acceptance optimization

support multiple payment methods (credit cards, digital wallets, insurance providers) to cater to client preferences

• route transactions by geographic area and test performance of various PSPs regularly
• consider using separate MIDs for different laboratory services to improve management and regulatory compliance

Operational discipline

monitor KPIs such as transaction success rates, chargeback ratios, and customer feedback

• conduct regular compliance audits and update operational policies to reflect changes in regulations
• designate a team member to oversee dispute resolution with defined response timelines

Payouts & liquidity

build liquidity buffers to manage rolling reserves and any unexpected financial requirements

• automate AML checks for large withdrawals to ensure compliance with financial regulations
• keep an eye on withdrawal patterns to identify any suspicious activities and maintain account integrity

Business Scope & Examples

This MCC includes businesses that provide diagnostic, therapeutic, or preventive medical and dental laboratory services. Merchants classified under this category typically offer various laboratory tests and analyses directly related to healthcare, supporting physicians and patients in diagnosis and treatment.

Models

medical laboratories conducting blood tests and biochemical analyses

• dental laboratories creating dental prosthetics and crowns
• pathology labs specializing in tissue analysis and diagnostics
• molecular and genetic testing laboratories
• clinical research laboratories performing trials and assays

Borderline cases

Health and wellness centers — may offer lab services but primarily focus on holistic or alternative treatments, which generally do not fit this MCC.

• Home testing kits — while potentially involving lab services, they may not classify under this MCC if no analysis is conducted in a formal laboratory setting.

Signals for correct classification

services include processing and analyzing biological samples from patients

• laboratory operates under regulation and standards typical for clinical laboratories
• results are provided to healthcare professionals to aid in diagnosis or treatment