The secret to getting money off the books and into the bank

July 15, 2013
Without effective collection strategies, money cannot get into the bank easily. You cannot pay bills on a promise, so close attention must be paid to this important system.

by Lois Banta

Without effective collection strategies, money cannot get into the bank easily. You cannot pay bills on a promise, so close attention must be paid to this important system.

  1. Collect at or before the time of service. This seems like a no-brainer; however, many practices overlook this important step. Discuss financial arrangements when the appointment is scheduled. Use effective verbal skills. Don't ask yes or no questions. Inform the patient of their estimated amount due and simply ask, "How do you wish to pay the estimated balance due … cash, check, or credit card?" This means always offer more than one option. This makes the patient feel in control, while in actuality the dental practice is in control.
  2. Have a back-up plan in case the patient says he or she doesn't have the money to pay for the services all at once. Sometimes the patient may ask, "Can I make payments?" In this case, always respond with, "Absolutely, we have a partnership with CareCredit. We have two options -- the no-interest, six, 12, or 18-month payment option, or the up-to-60-month option at a low interest rate. Which would you prefer?"
  3. Have a detailed and effectively written collections and financial arrangements guideline. This should be an internal document to be used as a reference for consistent and successful collections. Detail out the options available for payment, outside financing options, and what to do if the account becomes past due.
  4. Take private time to follow up on all overdue monies. Statistically, the practice loses 7% for each month the balance ages beyond 90 days. Careful consideration must be paid to ensure an account balance doesn't age beyond 90 days, and systems need to be in place to track those overdue monies. Generate an accounts receivable aging report. Include in this report only account balances over 30 days old so you have a clean report. I typically recommend sending no more than four statements — current due, 30 days overdue, 60 days overdue, and the 90-day/final notice letter. The account should receive a collection phone call on the 60 days overdue and 90-day/final notice. After that, take collection action. Know the laws in your state and use the Fair Debt Collection Practices Act guidelines. ( Keep in mind that some state laws are different from federal laws, and state law trumps federal law.

Use visual aids regarding financial guidelines in the office. If the practice puts a sign up in the office, I recommend making it visually appealing. Make the sign large enough for patients to easily notice and read. I recommend that the "Ask about our flexible financial arrangements" sign be placed in the financial arrangements area or reception room. Make it big enough for patients to notice it … at least 8" X 10". Additionally, if you expect payment at the time of service, make sure your patients are aware. If the practice accepts credit cards, list which ones are accepted and clearly display this in the financial area of the practice. About half of patients listen with their ears; however, half also "listen" with their eyes. They need to see, feel, and touch the message in order to "hear" the message.

And finally, inspect what is expected, especially regarding collections. Always consider the intended outcome before planning the action. If it does not occur to you to ask for payment, it will not occur to the patient to pay.

Lois Banta is CEO and founder of Banta Consulting, Inc., established in 2000. Ms. Banta is also the owner and CEO of the Speaking Consulting Network. Banta Consulting specializes in all aspects of dental practice management. Ms. Banta has over 37 years of dental experience. To contact her for a personal consultation or to invite her to speak to your organization, call 816-847-2055, write 33010 NE Pink Hill Rd, Grain Valley, MO 64029, email [email protected], or visit her website at

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