Healthcare Payroll Software for Practices
Compare 12 healthcare payroll platforms for practices of 5 to 50 staff, with real cost, shift differential rules, and PBJ requirements.
Healthcare Payroll Software
12 platforms compared for practices of 5 to 50 staff, the shift differential rule that quietly underpays nurses on every overtime week, the alternative overtime system most outpatient practices are not allowed to use, and what a 15-person practice actually pays
A nurse earns $35 an hour. This week she works 24 regular hours and 16 night hours carrying a $5 differential, then picks up overtime. If your payroll calculates that overtime at $35 times 1.5, it is wrong, and the Department of Labor names this exact failure as a common error in the health care industry.
Her regular rate for the week is $37, because the differential is compensation for work performed and belongs in the calculation. The difference on one nurse in one week is small. Across a clinical staff running differentials every week, it is the shape of a collective action.
That is the useful version of what makes healthcare payroll different. Most comparisons in this category answer a different question, ranking a 400-bed hospital system and a five-provider clinic in the same list even though the two have almost nothing in common as payroll problems. This one is written for practices between 5 and 50 staff, covers what actually applies at that size, and says plainly where the healthcare-specialist platforms are the wrong purchase.
First question: are you a practice or a facility?
This single distinction eliminates most of the category, and almost no comparison asks it before ranking products.
| Outpatient practice | Certified nursing facility | |
|---|---|---|
| Typical examples | Physician group, dental office, PT clinic, medspa | Skilled nursing facility, long-term care |
| CMS staffing reporting | Not applicable | Quarterly PBJ submission required |
| Coverage pattern | Business hours, some evening or weekend | Round the clock, every day |
| 8 and 80 overtime option | Not available | Available to residential care establishments |
| Credential volume | Handful of licensed clinicians | Large clinical workforce with rolling expiry |
| Right software category | General SMB payroll | Healthcare-specialist or enterprise HCM |
If you are a practice, the healthcare-specific features that dominate these comparisons are features you will pay for and not use. PBJ file generation is worthless without a PBJ obligation. A credential library sized for hundreds of clinical staff is expensive overhead for a practice tracking eight licenses. Union rule engines and 24-hour scheduling matrices are answering a question you do not have.
What a practice genuinely needs from payroll is narrower: correct differential handling if you run evenings or weekends, accurate overtime including the regular rate calculation, clean handling of a mixed W-2 and contractor roster, and multi-state filing if any staff live across a line. General SMB payroll platforms do all of that.
Shift differentials and the regular rate
This is the rule that produces the most back-pay exposure in healthcare, and it applies to any practice paying extra for evenings, nights, or weekends.
Under the Fair Labor Standards Act, overtime is 1.5 times the regular rate, defined as total remuneration for the week divided by total hours worked. It is not the base hourly rate. Shift differentials are compensation for work performed and cannot be excluded from it, and the Department of Labor guidance for the health care industry names failure to include differentials in the regular rate as a common violation.
| Step | Calculation | Figure |
|---|---|---|
| Base pay | $35 x 40 hours | $1,400 |
| Night differential | $5 x 16 night hours | $80 |
| Total remuneration | Base plus differential | $1,480 |
| Regular rate | $1,480 divided by 40 hours | $37.00, not $35.00 |
| Overtime rate | $37.00 x 1.5 | $55.50, not $52.50 |
Two related traps. Paying the differential on all hours and then calculating overtime only on base is a documented industry error rather than a rounding difference. And where an employee works two roles at different rates in the same week, which is common in small practices, the regular rate blends across both. Our guide to overtime rules covers the underlying calculation.
The 8 and 80 rule, and who may actually use it
Section 7(j) of the Fair Labor Standards Act offers healthcare employers an alternative to the 40-hour workweek: a fixed 14-day work period, with overtime paid for hours beyond 8 in a day or 80 in the period. For 12-hour shift patterns that do not fit neatly into weeks, it is genuinely useful.
| Condition | Requirement |
|---|---|
| Who may use it | Hospitals and residential care establishments only |
| Work period | A fixed, regularly recurring 14-day period |
| Agreement | Prior agreement or understanding with affected employees before the work |
| Overtime trigger | Over 8 hours in a day or over 80 in the 14 days |
| Mixing systems | Permitted across different employees, never for the same individual |
| Rate | Still 1.5 times the regular rate, differentials included |
State law adds another layer. California requires daily overtime after 8 hours and double time after 12, which for a clinic running 12-hour shifts triggers overtime on every shift regardless of weekly totals. The federal 40-hour analysis alone is insufficient there and in several other states.
Salaried does not mean exempt
The other frequent source of claims in practices is treating a salary as an exemption. Exemption depends on duties and salary together, and the professional exemption generally requires advanced knowledge in a field of science or learning acquired through prolonged specialised instruction. Medical assistants typically do not meet it, and neither do most front desk, billing, and technician roles. A salaried medical assistant working 45 hours is owed overtime on five of them. Our guide to exempt versus non-exempt classification covers the tests.
Per-diem, locum, and contractor staff
Practices routinely run a mixed roster, and the labels used in healthcare do not map cleanly onto tax classifications.
| Arrangement | Usual classification | What to check |
|---|---|---|
| Per-diem nurse working your shifts | Usually a W-2 employee | You control schedule, supervision, and equipment |
| Locum physician through an agency | Usually the agency's worker | Confirm in the agency contract who employs them |
| Locum engaged directly | Depends on the arrangement | Apply the common-law test rather than the label |
| Reading or interpretation services | Often a genuine contractor | Independent practice, own equipment, multiple clients |
| Front desk staff on flexible hours | W-2 employee | Flexible hours do not create contractor status |
The word per-diem does nothing legally. Classification follows the IRS common-law test on behavioral control, financial control, and the nature of the relationship, and a per-diem nurse who works shifts you assign, under your clinical supervision, with your equipment and your protocols, is difficult to defend as an independent contractor. Healthcare is an area where this is examined, and reclassification brings back payroll taxes, penalties, and usually state wage claims covering several years. Our guides to employee versus contractor classification and misclassification cover the test and the exposure.
The software question that follows is simply whether your platform handles both worker types with year-end filing for each. Most do; a few do not, and discovering the gap in January is expensive.
PBJ reporting, and why most readers can skip it
Payroll-Based Journal appears in every healthcare payroll comparison, usually without stating who it applies to. It applies to Medicare and Medicaid certified long-term care and skilled nursing facilities, with swing-bed hospitals excepted. If you run an outpatient practice, dental office, or clinic, it does not apply to you and you should not pay for it.
| Item | Requirement |
|---|---|
| Who files | Medicare and Medicaid certified long-term care and skilled nursing facilities |
| What is reported | Hours worked and paid per employee per day, by CMS job title code |
| Who is included | Employees plus agency and contract staff |
| What is excluded | Paid and unpaid breaks, and off-site hours for nursing positions |
| Deadline | 45 calendar days after each fiscal quarter ends |
| Penalty for missing it | Automatic one-star staffing rating regardless of actual staffing |
The penalty structure is what makes PBJ a software requirement rather than an administrative task for facilities that do have the obligation. A missed submission produces a one-star staffing rating in the Five-Star Quality Rating System even if the facility was fully staffed all quarter, and that rating is public. CMS also updated its PBJ data specifications during 2026, which is the sort of change a specialist platform absorbs and a general payroll product does not.
12 healthcare payroll platforms compared
Sorted by published price where one exists, with the quote-only specialists below. Every platform here files payroll taxes; the columns show what each adds beyond that.
| Provider | Best For | Starting Price | Shift Differential Rules | PBJ Reporting | Credential Tracking | Built for Healthcare |
|---|---|---|---|---|---|---|
| Patriot | Under 25 staff, tight budget | $37 + $5/ee | ||||
| Square | Clinics on Square point of sale | $35 + $6/ee | ||||
| OnPay | Small practices, one flat plan | $49 + $6/ee | ||||
| Gusto | Most practices at 5 to 50 | $49 + $6/ee | ||||
| QuickBooks | Practices on QuickBooks books | $50 + $6.50/ee | ||||
| Paychex Flex | Practices wanting a contact | $39 + $5/ee | ||||
| ADP RUN | Multi-site groups, compliance | Quote | ||||
| Netchex | Facilities needing PBJ | Quote | ||||
| Paycor | Growing multi-location groups | Quote | ||||
| Paylocity | 50 or more staff, HR depth | Quote | ||||
| UKG Ready | Hospitals and large systems | Quote | ||||
| HR for Health | Dental and small clinical | Quote |
Gusto
The strongest general fit for an outpatient practice at 5 to 50 staff. Custom pay rates handle shift differentials, it computes the blended regular rate, it pays W-2 employees and 1099 contractors with year-end filing for both, and its onboarding and document collection are the best among payroll-first platforms, which matters in a sector that hires continuously. Simple runs $49 per month plus $6 per employee.
Two constraints worth pricing. Time tracking sits on Plus at $80 plus $12 per employee, which for a practice running shifts is effectively the tier you need. And Simple covers a single state only.
OnPay
Close to Gusto in capability with one flat plan at $49 per month plus $6 per employee, and every state included at no surcharge. For a practice with staff living across a state line, or a group with sites in two states, that structure is materially cheaper than the alternatives. It also publishes healthcare-specific material and handles the mixed W-2 and contractor rosters practices run.
Patriot Software
The cheapest legitimate full-service payroll at $37 per month plus $5 per employee, with a time and attendance add-on available separately. For a small practice with straightforward daytime hours and a tight budget, it does the core job at the lowest price on this list.
What it does not have is any healthcare specificity at all. Differential pay codes are manual pay items, there is no credential tracking, and additional states cost extra.
Square Payroll
Relevant to clinics already taking patient payments through Square, particularly medspas, dental practices, and cash-pay clinics. At $35 per month plus $6 per person it has the lowest published base fee here, and timecards flow from the same system that takes payment.
QuickBooks Workforce Payroll
Core is $50 per month plus $6.50 per employee. The argument is ledger proximity rather than healthcare capability: if practice accounting already lives in QuickBooks Online, payroll entries reach the general ledger without an export step. There are no healthcare-specific features.
Paychex Flex
Service rather than software, with named representatives at higher tiers and a large compliance team. Flex Essentials is published at $39 per month plus $5 per employee for businesses under 20 people, which covers many practices, and everything above is quote-only. Its published healthcare compliance material is reasonable and it offers a PEO route for practices wanting benefits leverage.
ADP RUN
The deepest tax compliance engine in the category, with healthcare-oriented capability at the higher product tiers including ACA reporting and, in Workforce Now, PBJ. For a multi-site group operating across states with a real administrative function, that depth is the argument. ADP does not publish RUN pricing.
Netchex
Positioned explicitly as a healthcare specialist, combining payroll with credential and certification tracking, PBJ file generation, shift differential rules, and a learning module for compliance training. For a certified nursing facility this is the shape of product that removes real quarterly work rather than adding a feature.
Pricing is quote-based, and the fit narrows sharply below facility scale.
Paycor
Aimed at growing multi-location healthcare groups, with differential rules, per-diem handling, PBJ support, credential alerts, and earned wage access. It sits between SMB payroll and enterprise HCM, which is the right band for a group that has outgrown Gusto but is not a hospital system.
Paylocity
A full human capital management platform with a published healthcare practice, covering shift differentials, on-call pay, credential tracking, and a learning management system for compliance training. The natural band is roughly 50 employees and up, which places it above most practices reading this page.
UKG Ready
Built for hospitals and large health systems, with round-the-clock scheduling, credential libraries, union rule handling, and PBJ. Everything about it assumes a workforce measured in hundreds and an administrative function to run it. It is on this list for completeness and because it appears in every healthcare payroll comparison, not because a small practice should evaluate it.
HR for Health
A niche option built specifically for small clinical practices, with a dental and optometry focus, combining HR compliance documentation, license and continuing education tracking, and payroll delivered through an embedded partner. For a practice that wants credential tracking without facility-grade pricing, it is the closest fit in this comparison.
What a small practice actually pays
Modelled at 5, 15, and 30 staff, which covers most outpatient practices. Quote-only platforms are excluded because there is no published figure to model honestly.
| Provider | 5 staff | 15 staff | 30 staff | Annual at 30 |
|---|---|---|---|---|
| Patriot Full Service | $62 | $112 | $187 | $2,244 |
| Square Payroll | $65 | $125 | $215 | $2,580 |
| Paychex Essentials | $64 | $114 | $189 | $2,268 |
| OnPay | $79 | $139 | $229 | $2,748 |
| Gusto Simple | $79 | $139 | $229 | $2,748 |
| QuickBooks Core | $83 | $148 | $245 | $2,940 |
| Gusto Plus | $140 | $260 | $440 | $5,280 |
Two observations. At 15 staff the published options cluster between roughly $112 and $148 a month, a spread of about $36, which is small enough that choosing on price alone leaves most of the decision unmade. What actually separates them at that size is multi-state handling, contractor support, and whether time tracking is included.
And the Gusto Plus row is the one to read carefully. Time tracking sits on that tier rather than Simple, and for a practice running evening or weekend shifts, time tracking is not optional: it is the input that makes differential handling and the regular rate calculation work. At 15 staff that takes the monthly cost from $139 to $260.
Credential tracking: a real problem in the wrong system
Every practice has this problem. Clinical licenses, board certifications, DEA registrations, BLS and ACLS cards, and immunisation records all expire on independent schedules, and an expired license means a clinician cannot lawfully work the shift they are scheduled for.
The question is not whether you need to track it but where the tracking belongs. Payroll runs on a pay cycle. Credentials expire on their own calendar, and nothing about a payroll run surfaces the fact that a nurse practitioner's certification lapses in three weeks.
Facility-grade payroll platforms solve this by including a credential module, which is a legitimate answer if you are buying that platform anyway. Buying a facility-grade payroll platform in order to get credential tracking is an expensive route to a document management requirement.
Verdict by practice type
Routing by what you actually are rather than by feature count. Most of these point away from the healthcare-specialist platforms.
| If this is you | Start with | Because |
|---|---|---|
| Outpatient practice, 5 to 50 staff, one state | Gusto | Best all-round payroll and onboarding, differentials handled correctly |
| Practice with staff in more than one state | OnPay | All states included at no surcharge on one flat plan |
| Practice under 25 staff on the tightest budget | Patriot | Cheapest full-service filing, differentials entered manually |
| Medspa or dental clinic on Square | Square Payroll | Timecards flow from the system already taking payment |
| Practice accounting already in QuickBooks | QuickBooks Core | Ledger sync with no export step |
| Certified nursing facility with PBJ obligation | Netchex or Paycor | Native PBJ generation against a public deadline penalty |
| Multi-site clinical group across states | ADP RUN or Paycor | Multi-jurisdiction compliance and cost center reporting |
| Dental practice wanting license tracking | HR for Health | Credential tracking without facility-grade pricing |
| Above 50 clinical staff, wanting HR depth | Paylocity | HCM tooling and compliance learning in one system |
| Hospital or large health system | UKG Ready | 24-hour scheduling, union rules, and enterprise credentialing |
Before you choose
FirstHR does not process payroll, file payroll taxes, calculate differentials, or generate PBJ files. Every platform above does something we do not, and if paying clinical staff correctly is the problem in front of you, one of them is the answer. Pick from the comparison.
The reason this section exists is the credential section above it. Practices consistently arrive at healthcare payroll software looking for two things at once: a payroll engine and a way to stop losing track of licenses, certifications, and training records. Those are different problems, and buying a facility-grade payroll platform to solve the second one is how a 15-person practice ends up with a quote built for a nursing home.
That is the layer we handle: onboarding workflows a new clinician completes before their first shift, e-signature on I-9s, W-4s, offer letters, and policy acknowledgments, employee records with expiring document fields that stay retrievable after someone leaves, document management, and training with completion tracking for HIPAA, OSHA, and practice-specific modules. It runs at a flat $98 to $198 per month for 5 to 50 employee US teams regardless of headcount. It sits alongside whichever payroll platform you choose rather than replacing it. Our guide to healthcare onboarding best practices covers what that sequence looks like in a clinical setting.
Frequently Asked Questions
What makes healthcare payroll different from regular payroll?
Shift differentials that must enter the regular rate before overtime, clinical credentials that expire, mixed W-2 and per-diem rosters, and for certified nursing facilities a quarterly CMS staffing submission. An outpatient practice needs the first two and generally not the last.
How do shift differentials affect overtime pay?
They raise the overtime rate. Overtime is 1.5 times the regular rate, being total compensation divided by total hours, not the base rate. A nurse at $35 with 16 night hours at a $5 differential across 40 hours has a regular rate of $37, so overtime is $55.50 rather than $52.50.
What is the 8 and 80 overtime rule and can my practice use it?
Section 7(j) lets hospitals and residential care establishments use a fixed 14-day period, paying overtime beyond 8 hours daily or 80 in the period, with a prior agreement in place. It is not available to physician-owned outpatient practices or dental offices, and applying it there underpays overtime every cycle.
What is PBJ reporting and does my practice have to do it?
Payroll-Based Journal is a quarterly CMS staffing submission required of Medicare and Medicaid certified long-term care and skilled nursing facilities. It is due 45 days after each fiscal quarter, and missing it triggers an automatic one-star staffing rating. Outpatient practices and clinics have no PBJ obligation.
Do I need credential tracking in my payroll system?
You need it somewhere, but payroll is an awkward home for it because credentials expire on their own calendar rather than on a pay cycle. Facility platforms include it, which is fine if you are buying one anyway. For a small practice it is more naturally a document management requirement than a payroll one.
How much does healthcare payroll software cost for a 15-person practice?
At published July 2026 rates, roughly $112 for Patriot, $114 for Paychex Essentials, $125 for Square, $139 for OnPay or Gusto Simple, and $148 for QuickBooks Core per month. Adding time tracking through Gusto Plus takes it to about $260. Specialist healthcare platforms are quote-only and priced above this range.
How do I pay per-diem and locum staff correctly?
Classification first. A per-diem nurse working shifts you assign under your supervision with your equipment is usually a W-2 employee regardless of the label. A locum through an agency is usually the agency's worker. Genuine contractors are paid gross with Form 1099-NEC at $600 or more.
What is the best payroll software for a small medical practice?
Gusto or OnPay for most outpatient practices at 5 to 50 staff, with OnPay ahead for multi-state and Gusto ahead for onboarding and benefits. Patriot if budget is binding. Square for clinics already on Square. Healthcare-specialist platforms are better healthcare products and worse small-practice fits.
Are medical assistants exempt from overtime?
Almost never. Exemption depends on duties and salary together, and the professional exemption generally requires advanced knowledge acquired through prolonged specialised instruction, which medical assistants typically do not meet. A salaried medical assistant working 45 hours is owed overtime on five of them.
Does payroll software need to be HIPAA compliant?
Payroll data is generally employment information rather than protected health information, so a payroll platform is not usually a business associate. Health data entering the employment record, such as occupational health results or leave documentation, should be kept separate from the personnel file for independent reasons.
Should a small practice use a healthcare-specific payroll platform?
Usually not. Specialist platforms earn their price through PBJ generation, credential libraries, union rules, and 24-hour scheduling, none of which an outpatient practice needs. What a practice needs is correct differentials, accurate overtime, and mixed worker support, which general SMB payroll platforms provide at a fraction of the cost.
How does high clinical turnover affect payroll setup?
It shifts the burden from processing to onboarding. Each clinical hire needs the usual tax forms plus license verification, certifications, immunisation records, screening, and HIPAA and OSHA training acknowledgments. Payroll is unaffected by turnover; document completeness is what degrades, and the gaps surface at credentialing or survey.