Health-care credit cards can increase case acceptance

March 1, 1996
There is no question that one of the major concerns of patients today is customer service. What we often forget is that customer service includes flexible financial options. It is not unusual for dentists to think that they have closed a treatment plan with a patient agreeing to pay the total fee and then find out that satisfactory financial arrangements could not be made. In today`s world of dentistry, flexible financial arrangements are more critical than ever before. Every practice should hav

You no longer have to worry about collection when a patient uses a dedicated health-care card.

Roger P. Levin, DDS, MBA

There is no question that one of the major concerns of patients today is customer service. What we often forget is that customer service includes flexible financial options. It is not unusual for dentists to think that they have closed a treatment plan with a patient agreeing to pay the total fee and then find out that satisfactory financial arrangements could not be made. In today`s world of dentistry, flexible financial arrangements are more critical than ever before. Every practice should have a policy that addresses the issues of cash, standard credit cards and Dedicated Health Care Credit Cards (DHCCC) as an alternative line of credit for the patient.

Practices, today, that do not go far enough to include a DHCCC, are probably losing tens of thousands of dollars per year in treatment that is not accepted by patients.

Remember, patients today want convenience and customer service.

Our clients have found that a DHCCC is a tremendous time- saver for the practice. All too often the front desk is tied up collecting money that is owed to the practice. When you really think about this in a dental office, it does not make sense. There is a cost in the time that your front-desk staff uses to collect money. It is also a job for which most people are not well trained and that most front-desk staff do not enjoy and, therefore delay, or, even worse, ignore it. I remember one person at the front desk telling one of our consultants, "Oh, I put collections off as long as I can, because I hate doing it."

A DHCCC helps to eliminate collections. Obviously, the best scenario is for the patient to pay you in cash or use a standard Visa or Mastercard. However, there are many people today that do not have those options available to them, but would readily take advantage of an opportunity to use an alternative line of credit.

The best part about a patient using a DHCCC is you no longer have to worry about the collection process. Our financial analysis shows that in most cases the cost of using this alternative is less than the expense of the front-desk staff when trying to collect accounts. Not only is it more pleasant for the front desk not to have to collect overdue money and send bills, but it does not place the office in an adversarial position with patients. Keep in mind that many of the malpractice suits filed are what I call "retribution law suits" which occur when you turn a patient over to collection for unpaid bills. If the money is owed to a DHCCC instead of the dental practice, you bear no risk of having a "retribution law suit" filed against your office.

Increase Productivity

The other benefit of DHCCC is that in most cases you will be doing a lot more dentistry than you would otherwise. In other words, patients will be able to take advantage of larger cases rather than having minimal treatment. Despite the fact that the office does pay to use a DHCCC, your overall profit will be much higher due to the size of the case. After all, would you rather have an $800 profit on $2,000 worth of dentistry or no profit if the patient simply cannot afford to have the treatment performed.

The answer is obvious! We must begin to realize in our practices that it is not simply a matter of our current productivity, but the fact that we are losing a great deal of productivity that goes unmeasured in the practice. Most dentists would rather have significant profitability on a case rather than none at all.

Conversely, there is one area where many practices miss the benefit of a DHCCC. And that is on the smaller cases. Too often we think about using an alternative line of credit only on big cases when it can be a tremendous benefit even on the smaller ones. After all, how much time does your front desk spend chasing people for relatively small balances of $100 or less. By using an on-going treatment form/signature on file, your staff can automatically add these smaller balances, copays or uncovered patient expenses to their charge card. This eliminates your having to bill the patient and, most importantly, pays you in just two banking days.

The point is that no matter how you evaluate it, a DHCCC can save money by reducing the expense time of your front-desk staff. Even on small procedures such as prophys and minor restorations, this is an opportunity to get the billing cycle out of your office for those patients-this allows your front-desk staff to focus on more important areas such as patients that are overdue for treatment, dealing with insurance companies, practice marketing, etc.

As we enter a new and different era of dentistry, alternative financing is becoming increasingly important. You want to work with a company that has excellent information for patients and has a customer-service orientation. The financial benefits of an alternative credit card significantly outweigh a traditional collection-style system. I remember a time when people did not want to use Visa or Mastercard, because they had to give up some percentage to those companies. However, once dentists started using Visa and Mastercard, their production and profitability increased significantly. The same is true for a DHCCC, and in many cases it will approve lines of credit that are significantly higher than those of Visa or Mastercard. For practices that want to be involved in comprehensive cases all the way to practices that are handling minor procedures, a DHCCC is an option that should be considered. In most cases, once put in place, practice productivity and profitability increase.


One other area rarely considered by dentists is truth-in-lending laws for patients. More and more dentists are violating truth-in-lending laws by threatening to charge, placing interest charges on the bill or charging interest improperly. This is a complex area that eventually will cause some practices serious problems with the government. The truth-in-lending laws require "consumer lenders" to make a number of various specific disclosures to the consumer. In other words, the dental office has to provide ultra-specific information to any patient involved in the threat of or implementation of interest charges. A patient who demonstrates that the practice did not carry out proper truth-in-lending regulations can recover his/her actual damages and attorney fees plus twice the financial charges by the practice.

A DHCCC once again avoids the necessity charging or pretending to charge interest. If a patient has paid the bill with one of these cards, the practice has no further collection needs. This is one more reason to get the collection process out of your office as soon as possible.

Alternate Credit is Important

There are many factors involved in choosing a DHCCC. However, the most important factor is to be sure that you have an alternative credit card available as a customer service and convenience factor. We have seen as much as a 30 percent rise in treatment acceptance amongst our clients after they add a DHCCC as a payment option. The one important aspect is to understand that it is not enough to simply have it available. You literally have to market it to patients.

Once you have added a DHCCC to your practice, send a letter to all of your patients explaining the availability of this new payment option. Many dentists still live in a world where they do everything possible to try not to use a credit card or some other payment option where a percentage of the payment is lost either to the credit-card company or to the DHCCC company. This is not a good business philosophy today. The electronic transfer of money and the ability to borrow instantly using a piece of "plastic" has become part of the fabric of the American economy. Losing a certain percentage of the payment so that the patient can gain an instant loan to purchase services should be something that we aggressively seek out rather than attempt to hide from.

The letter that goes to patients should promote the DHCCC as a payment option and the ability for your patients to acquire an additional line of credit making it possible for any patient to have dental work on an as-needed basis.

Many patients will have no interest in using a DHCCC because they have been trained over the years as to how payments are made to your practice. However, we find in most client practices that the amount of untreated, but diagnosed dentistry in the patient base runs into the hundreds of thousands of dollars. These patients will be very interested in understanding that a new payment option exists because, in most cases, it is financial capability that has restricted the patient from having the needed treatment.

Think about it logically for a second. A patient who keeps returning to your practice obviously has some level of trust and positive feeling. Why then would that patient not follow through on a doctor`s treatment recommendations? The answer is rather obvious. If he/she likes you and trusts you, it must be something beyond the belief that he/she actually needs that treatment. In most cases, it is a financial matter.

Once the letter has been sent to all of your patients about the DHCCC, the front desk and financial staff need to be trained to educate patients about the availability of the DHCCC. I recommend that every patient be given a brochure about the availability of the DHCCC to reinforce the letter and continue to educate patients about the use of the DHCCC. Hand the patients the brochure and say: "This is a brochure about a new financial option which we have for patients. We always do everything possible to make it as easy and convenient for our patients as we can. After you have read the brochure, if you have any questions, I would be delighted to answer them for you."

This simple exchange is a very positive marketing statement about customer service. Without question, the DHCCC is one of the best customer-service additions you can make to your practice.

Selecting A DHCCC

The selection of a DHCCC is not all that complex. There are few parameters that should be carefully understood prior to making your selection.

1. Select a company that knows dentistry well. Dentistry is not like all other fields and has certain unique financial factors. You do not want to simply add some kind of "loan" program, but rather work with a company that is likely to understand the needs of your practice. Call the company and ask them how many dentists and other health-care professionals they handle. If they cannot answer the question or the number is relatively low, then this might not be the best company for you.

2. You want a nonrecourse program. This means that once the patient has contracted with the DHCCC and payment has been made to the dental practice by the DHCCC company, the dentist and practice are no longer involved. In other words, if the patient fails to pay the bill to the DHCCC company, the dentist and practice have no further responsibility. The company cannot come back and take money away from the dentist or the practice simply because the patient did not pay the bill to the DHCCC company. This is the same as Visa and Mastercard. If you make a purchase in a retail store with Visa and you do not pay the bill, Visa does not penalize the store. At this point, it will be between the DHCCC company and the patient.

3. How does the DHCCC company pay the dental practice? You are looking for a company that makes prompt payments to your practice Many companies deposit funds directly into a practice checking account.

4. What are the patient-approval rates? One of the most common questions I get in seminars is concerning approval of patients. Yes, there certainly are people out there who are never going to get approval from any company and they do not deserve it due to their credit rating. You certainly do not want to give these people any kind of payment plan from your office, because it is unlikely that it will ever be paid. However, you want a company that has a relatively high approval rate. With a high approval rate, more patients are approved and treatment-acceptance increases.

5. How does the staff learn to use the DHCCC? You want to work with the company that has ongoing customer support. This company should work with your staff on how to use the card, any problems which occur and how to maximize your DHCCC program.

6. Who is behind the DHCCC in regard to finance and making payments? This is a question very few dentists would think to ask, but it is an important one. You essentially want to work with a DHCCC company that is backed by a large lender.

7. What do I do if problems occur? Be sure you are working with the DHCCC that is easily accessible, preferably with a toll-free number with your own customer representative.

Frequency of Use

I previously addressed the desire of most practices not to use the DHCCC unless absolutely necessary. This message fosters a negative feeling by your staff about the card and they often will fail to make patients aware of its existence. As with most things in a business, if it is not used regularly, chances are very good that it will be forgotten. A DHCCC is no different, use it in all circumstances where a patient`s out-of-pocket expense is not being paid with cash, check or major credit card.

We take a slightly different approach. I recommend that the DHCCC be offered as a standard option along with 5 percent for cash and the traditional Visa, Mastercard and Discover. The opportunity to use a DHCCC should be offered in almost every situation and it should become a normal part of the office financial program. This way, patients have options and choices.

Understand that the small cost of using a DHCCC program is, in fact, less than one-third of what you will spend if you bill these patients. The additional treatment-acceptance generated by using the DHCCC program will more than affect its cost besides substantially adding to your bottom line. Unless your practice is at absolute maximum capacities, performing only high-level procedures, then the DHCCC can increase your overall productivity dramatically.

The author is president of The Levin Group, a comprehensive, dental-management, marketing and financial-consulting firm working with dental practices nationwide. He lectures extensively throughout the U.S. and Canada.

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