How to Pay Medical Providers Electronically on PI Settlements

Paying medical providers electronically instead of by paper check is one of the most impactful operational changes a PI firm can make to its settlement disbursement workflow. Electronic payment eliminates 7–15 business days of paper-check delay, and providers receive funds the same day — or in seconds with RTP.

This post covers exactly how to set it up, what it requires technically, and what compliance obligations apply.

The Three Electronic Payment Methods

Three payment rails are available for medical provider payments from PI settlements:

Same Day ACH

Same Day ACH is the most broadly available option. NACHA's Same Day ACH window allows transactions to settle same-day for amounts up to $1 million. It reaches virtually all US bank accounts and requires only the provider's ABA routing number and account number. The sending bank must participate in NACHA's Same Day ACH service, which covers the vast majority of US banks.

RTP (Real-Time Payments)

The Clearing House RTP network delivers payment in seconds, 24/7/365. Approximately 65% of US demand deposit accounts are now reachable by RTP. For medical providers at banks participating in RTP, this is the fastest option available — a payment authorized at 5pm on a Friday evening arrives at the provider instantly.

Wire Transfer

Wire transfer is same-day (if sent before the bank's cutoff time) and handles any dollar amount. It costs $15–$25 per transaction and requires the provider's routing number, account number, and bank name. Wire is typically used for large hospital lien payments or for edge cases where a provider's bank isn't ACH-compatible.

What You Need to Set Up Electronic Payment

Setting up electronic payment to medical providers requires four things:

• IOLTA trust account with ACH origination capability — your bank must allow ACH debits originating from the trust account, or you need a disbursement platform that manages the payment origination.
• Medical provider bank details — routing number (ABA) and account number for each provider. Collect this securely when the provider is onboarded as a lien payee.
• Disbursement platform with matter-level tracking — every payment must be tied to a specific client sub-ledger. A generic ACH payment from the trust account without a corresponding ledger entry creates a trust accounting gap.
• Payment confirmation storage — ACH confirmation receipts, RTP payment IDs, or wire confirmation numbers must be stored in the case file as supporting documentation.

Compliance Requirements for Electronic Trust Disbursements

Electronic payment doesn't change the underlying trust accounting obligations — it just changes how the money moves. The following compliance requirements apply regardless of payment method:

• Every payment must be recorded as a debit in the client's sub-ledger tied to the matter.
• The payment must appear as a line item on the settlement statement, reviewed and signed by the client.
• The payee (medical provider) must be a party with a verified, valid claim on the settlement proceeds.
• The payment confirmation must be retained in the case file for the state bar's required retention period (5–7 years in most jurisdictions).
• The trust account must be reconciled after disbursement to confirm the ledger, bank statement, and client ledger sum all agree.

Collecting Provider Bank Details

The practical bottleneck in switching to electronic payment is collecting bank details from medical providers. Most providers have never been asked for their routing number by a law firm and may be cautious about sharing it by email.

Best practices for secure collection:

• Use a disbursement platform that sends a secure, encrypted bank-detail collection form directly to the provider — not a plain email request.
• Verify the collection form link goes to a domain you control, not a generic form tool.
• Store the collected banking information in encrypted form — never in a spreadsheet or email attachment.
• For recurring provider relationships, collect once and reuse — the same routing/account numbers apply to future settlements.

Related reading: How PI firms automate lien payments, and how medical providers get paid faster on lien cases.

This post is general educational content, not legal advice.