How to Accept Payments for Private Pay in Assisted Living: Simple Options That Work
Aug 13, 2025
Starting an assisted living facility is exciting, but figuring out how to get paid can be confusing—especially when it comes to private pay residents, those who pay out of pocket without Medicaid or other government help.
This guide breaks down the three main ways to accept payments from private pay residents so you can choose what fits your business best and keep cash flowing smoothly. Knowing your payment options helps you avoid surprises and makes billing easier for everyone.
Let’s dive in! π°
Check out this video, too:
Why Payment Methods Matter
Getting paid on time means your facility can run smoothly, pay your staff, and provide the best care for your residents without financial stress. Late or missed payments can cause big headaches, from cash flow problems to interrupted services.
Ask yourself:
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What payment methods will my residents and their families prefer and trust?
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How will these options affect my cash flow and payment processing fees?
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How can I keep payment processing simple, secure, and efficient?
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How will I handle late payments or bounced transactions?
Let’s explore your best payment options to keep your facility financially healthy and your residents happy.
Option 1: Paper Checks
Many seniors and their families feel the most comfortable using checks—they’ve trusted them for decades. Paper checks remain a popular payment method in assisted living.
Here’s why checks can work well:
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You receive full payment with no transaction fees eating into your revenue.
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You can deposit checks remotely by scanning or using your bank’s mobile app, saving trips to the bank.
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It’s a familiar and easy method for many older adults and their families, who may not want to use digital payments.
But watch out for some downsides:
β Bounced or “bad” checks cause delays and require follow-up.
β Checks can get lost or delayed in the mail, slowing your cash flow.
β It takes longer for funds to clear compared to electronic payments.
If you accept checks, have a clear policy about when payments are due and what happens if a check bounces. Consider asking for post-dated checks or setting up a backup payment method for emergencies.
Option 2: Credit and Debit Cards
Not everyone has or wants to use a bank account for ACH, so credit and debit cards are popular because they’re quick and convenient. Many families prefer cards because of rewards programs or the ability to dispute charges if there’s a problem.
You’ll need a way to process these payments, such as:
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A point-of-sale (POS) terminal to swipe, dip, or tap cards when families visit.
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An online payment platform that can charge automatically monthly via a secure portal.
The biggest downside? Fees. Most credit card processors take about 2.5% to 3.5% per transaction. On a $5,000 monthly payment, that’s $125 to $175 lost in fees—which is quite a big chunk for a startup or small facility.
Still, credit cards can help avoid delays and make payments consistent. Some providers also offer payment plans or split payments, which can be helpful for families managing budgets.
Option 3: ACH Transfers
ACH stands for Automated Clearing House. It lets you take money directly from a resident’s or family member’s bank account on a scheduled date. It’s like an electronic check that moves money reliably and securely.
Here’s how ACH transfers work:
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You get written authorization from the resident or responsible party.
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Collect their bank routing and account numbers safely—never store this info insecurely.
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Set up automatic withdrawals on a fixed date, usually monthly.
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Monitor the bank accounts for changes or returned payments.
ACH payments typically cost a low flat fee, or a small monthly fee instead of a big percentage like credit cards. This makes it the most affordable option for regular payments.
A few tips for ACH:
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Make sure you have a secure way to store sensitive banking info and comply with privacy laws.
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Have a clear refund and cancellation policy in case someone moves out or passes away.
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Consider making ACH your preferred payment method to reduce costs and keep cash flow steady.
Quick Recap: Which Payment Method Is Right for You?
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Checks: Familiar and fee-free but riskier due to bounced checks and mail delays. Best if your residents prefer paper payments and you’re okay with manual processing.
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Credit Cards: Fast, convenient, and familiar for many, but the fees can add up and reduce your income. Good if you want easy payments with minimal follow-up.
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ACH Transfers: Low-cost, automatic, and reliable with good cash flow predictability. Ideal if your residents or families are comfortable with digital banking.
Many facilities accept a combination of these methods to fit different resident preferences. Make sure you communicate payment options clearly when families move in, so there are no surprises later.
Ready to Build a Rock-Solid Foundation for Your Facility?
Before you dive into payments, make sure your whole business plan is in place. It’s easier to grow and manage your facility when your plan covers everything—from marketing and operations to finances.
β Download our Business Plan Checklist to cover all the basics, including how you’ll handle payments.
Want Hands-On Help From Experts?
Need help figuring out where to start? Join the next Roadmap Challenge and build your launch plan with me.
Show full transcript π
Transcript
00:00:00 - 00:00:54
Hey friend, I'm Brandon Gustafson. I help beginners like you launch their assisted living business in the next 12 months. In today's video, we're going to be getting into how to accept payments for private pay residents inside of your assisted living facility. So, if you're interested in learning more about that, stick around for today's [Music] video. Hey friend, welcome to Assisted Living Investing. Before we get started, I want to remind you to go and grab your free underwriting calculator at
00:00:29 - 00:01:15
assistedlivinginvesting.net. Just go to the website top right corner. You're going to see there the big blue box lets you get that free underwriting calculator. So, make sure you go and grab that free tool. Now, let's get into the topic for today's video. Today, we're going to be talking about how to accept payments for private pay residents inside of your assisted living facility. Now, there's a few ways that you can accept payments at its core. We're going to talk about checks. We're
00:00:52 - 00:01:39
going to talk about ACH. We're going to talk about credit cards actually as well. Those are the three ways that you can accept payments from the residents that are inside of your assisted living facility. I want to kind of go through some pros and cons of each of those so you understand exactly what they are, what it entails, and how to get those things set up. So, in order for you to set things up with checks, these are paper checks. This is, you know, typical, you know, old school checkbook
00:01:16 - 00:02:11
type of a of a thing. That's how you're you're getting paid. This is actually pretty common. you are dealing with a population that has dealt with checks for most of their lives and so they're comfortable with it. They they trust that piece of paper. They want to do that. They don't like to do other things. Um they want to do just that. There will be people that will absolutely refuse to move to any other type of payment because they want to do uh just a paper check. So you have to
00:01:44 - 00:02:33
determine if that's something that you want to acquies to or not. That's totally up to you and what you're going to do. how you're going to build your internal policies and procedures how you're going to accept payment. It's up to you. Now, with checks, one of the nice things with checks is you can now do remote deposits. You don't have to go to to the branch and and do that type of a deposit. Uh but it is something that you do want to be aware of that checks, they can, you know, it's paper. They
00:02:08 - 00:03:00
could get lost. They could bounce. There's any number of reasons why a check might not be the best way for you to accept payment from a resident. you might just have to push back and tell them this is our requirement here at the facility. There can also be certain times certain banks will cause delays in allowing those funds to become available. So that can be a problem for you to be aware of and then just the fact that it could get lost. So you have to be very careful when you're working
00:02:34 - 00:03:24
with checks. Okay. Number two, we're actually going to talk about credit card payments. So with these, you can have a point of sale or a POSOS system. That's basically a little terminal that you can have inside of your house and and you have it. You just have it locked away and when it's time to do the payments, people can take out their credit debit card and they can swipe that or insert the chip or whatever it is, whatever your point of sale system is going to allow you to do. Something that you want
00:02:59 - 00:03:53
to be aware of when you're using this type of a of a method, when you are processing those card payments, there's going to be credit card fees. So, a nice thing about a check is you get the full amount. There's no, you know, three three and a half% that the credit card company's going to take away. You just get all of that. When you use credit cards, they're going to take a chunk of that money as a transaction fee. And so, you got to be aware of that. Can be really convenient, though. We actually
00:03:26 - 00:04:17
use a credit card processing thing in our Colorado facility because we have residents that for whatever reason don't have a bank account, can't create a bank account, have issues with that, they don't want to do it. whatever reason, they're not able to do it. But they do have like a debit card that they can use and then we can just swipe that. Don't ask me how it works. I just I've tried to get explanations on it. I just know that it's a fact that this is something that we've had to deal with in the past
00:03:52 - 00:04:44
with our residents. It's actually allowed us to make sure that we are getting the the payments that we need. uh if they don't have a bank account that that's like real that has routing and account numbers, we can't set them up in a trying to do checks through that end up being like cashiier checks and and there's a bunch of issues that we found in depositing those and so it's better for us to pay that 3% fee to process a card payment and make sure we actually get the money on in a timely
00:04:18 - 00:05:08
manner. So, uh this is just kind of trial and error and what works for us in that facility, but it's an option that you can consider. You can also do these. There's oftentimes platforms online that will allow you to capture card information there. You can even automate some of those collections just like you would with a you're just doing it with a card. And so that's a really nice benefit with doing that. You just have to be aware of those fees. And then if you're doing it with a physical
00:04:43 - 00:05:43
terminal, you're going to have to have a spot to securely keep that inside of the facility just so that nothing bad happens with it. Now the third one is AC. AC is stands for automatic clearing house. It's a way for you to get direct deposit of of funds from one bank account to another. It is in my mind the best way for you to collect payments from your private pay residents, even your residents that are on Medicaid that you have to collect a portion of money from. AC is, I would say, the gold
00:05:13 - 00:06:08
standard for how you're going to collect these payments. So, the way that a works is you're going to have to find a bank that supports a payments. And oftent times this could be your local bank or credit union that you're banking with for your business and they'll have some kind of a program. There may or may not be a fee, but it's generally a very minimal fee, 10 20 bucks a month compared to the 3% of a of a $1,000 $3,000 $5,000 transaction. So it's comparatively much smaller. And
00:05:41 - 00:06:29
sometimes they even weigh that if you have a certain amount of fees or if you're keeping a certain balance inside of your account um for a period of time. So, with a you're going to get the permission to do that. They'll typically give you some kind of a a form, a paper that basically says, "Hey, we're doing a payments. We promise to only do it for x amount of money for x amount of period of time. We're going to pull the money on this date." And there's going to be
00:06:04 - 00:06:50
pieces in there that that the resident has to fill out. You know, fifth of the month, here's my routing number. Here's my bank account. Here's the amount that I approve you to pull on a monthly basis. They're going to sign it. They're going to provide some contact details and things like that. And then once you receive that information, you're going to just put it into the bank account. You're going to set it up exactly what they wrote, bank account, routing number, the amount that it's going to
00:06:27 - 00:07:26
process for, when it's going to process. You're going to put all that information in. Then you set it, you forget it, and then you just make sure that funds are coming in. You will find that sometimes when there's a non-sufficient funds issue that the resident doesn't have the funds in there that it will pull in and then bounce back out and so and you can get dinged with your a provider if you do that. So that's something you want to be aware of but at its core this is the simplest way for you to do that. Push
00:06:57 - 00:07:47
back that you're going to get from some residents is they don't want you to have that information on file. They're not comfortable giving you the information. They don't they don't trust electronic systems. you know, those types of things, you may get some push back. But if you have a rule that we only do AC, and if you don't do a you cannot come here, you know, that's a personal choice for you at your facility, but something that you may want to implement because it simplifies the process. Money comes
00:07:22 - 00:08:12
in consistently on time every single time and allows you to collect that money. It is the way that I highly recommend that you do and that you go forward with collecting the funds. Learn a little bit about it. Do some research. make sure you're comfortable with it. But this is the way that I really think is the best way to do it because it just gets deposited directly into your account. There's not a lot of, "Hey, I need you to get me that check. Where's the checkout? Where's the cash? Where's
00:07:47 - 00:08:33
XYZ?" Um, you don't have to worry about that cuz the money is just coming in. You just have to then make sure that you are protecting and maintaining the correct account information. So, if something did change, somebody passes away, somebody leaves a facility, you have to have a policy that, hey, we're going to destroy this information, right? So, you want to put that all in place. So, to recap what we've been talking about today, we've been talking about how to collect payments from your
00:08:10 - 00:08:55
private pay residents. Really, at its core, three ways that you can do that. Number one is through checks. Number two, credit card processing. And number three is with a one that I highly recommend that you do if you're going to be collecting these payments from your private pay residents. If you like this video, if you found this to be helpful, make sure you like the video, subscribe, and ring the bell as well so you get notified every time we put out content like this. We do our videos on Thursdays
00:08:33 - 00:09:18
and we also do lives on Tuesdays to really help you out along your journey to help you launch that assisted living business. And if you need some help and some guidance with that, go check out the mastermind program, alimastermind.com. Does residential assisted living sound interesting to you, but you don't know how to get started? At assisted living investing, I'm here to help beginners like you launch their assisted living business in the next 12 months. I love helping and coaching people just like you so you can
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reach your investment goals and start your assisted living business. And remember, it doesn't take a lot, just a little bit. Just keep going step by step by step. And I promise you, if you do and you're consistent and persistent, you're going to be successful. Thanks for watching and have a great day. [Music]
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