Maximizing patient financing: Part 2

Every day an acount sits on your books doing nothing, you lose money because of (1) the cost of running a banking business within your practice...

Cathy Jameson, PhD

Every day an account sits on your books doing nothing, you lose money because of (1) the cost of running a banking business within your practice, (2) the chances of never collecting the account, and (3) the “loss of the dollar” as it sits on your books depreciating in value makes the carrying of accounts a difficult business process.

If you have existing accounts receivable, consider making an active effort to transfer as many of those accounts as possible to your patient-financing program. Get the money in the bank and let professionals take over the management of these accounts. Do not think you are doing your patients a favor by letting them delay payment to you. You are not doing them a favor by letting them get into a negative financial situation with you. You only are supporting behavior that is unacceptable to the world at large. You certainly are not doing anything to support the sound financial status of your own business. Remember, people who owe you money usually do not feel good about you or the relationship. Being “square” financially is an asset to relationships, while having a financial challenge between you can cause the relationship to deteriorate.

Suggested transfer steps

Suggested transfer steps

1)Analyze your accounts receivable. Determine the following:

How much is insurance? How much is private pay?

Of the private-pay accounts, how many are 30, 60, 90, 120 (or more) days past due?

Accounts that are extremely past due and have had no activity whatsoever may need to be turned over for legal action. (Make sure you approve all accounts to be turned over for collection or written off). Be certain you have made a concerted effort to collect the account and that the patient is unwilling to negotiate a settlement before you turn anything over for collection.

2)For all of the remaining accounts, create a letter introducing the idea of transferring accounts to your patient-financing program. Expound on the benefits of the program, such as:

Longer time in which to pay the account

Smaller monthly payments

No large payments due at one time

No initial or yearly fee to become involved with the program

Available credit for emergencies or for necessary and desired treatment

If you are charging a service fee higher than the financing program, stress the benefit of the lower service fee. (Make sure it is lower!)

3)Send an application and a brochure with this letter. Send this letter in a separate mailing, rather than with statements. Place the letter on your letterhead stationery and place it in one of your letterhead envelopes. This needs to be a special mailing in order to get a special response from your patients.

4)Begin a telephone campaign to all of those patients who have not responded to your mailings.

Track your telephone calls. Make notes of who you have called, those who were sent an application, the date you sent the application, the date it was received back in the office, and any comments relative to the conversation.

Note: If a patient is abiding by a previously agreed- upon financial arrangement, go ahead and offer the program to him or her, but willingly allow the patient to maintain this agreement if it is comfortable.

5)At the next statement run, send a follow-up letter with another brochure and another application to anyone who has not yet transferred his or her account.

6)Continue your telephone campaign with anyone who has not responded. Don’t give up!

7)By now, you should have had a strong response to your efforts if you have followed the recommended regime carefully and with commitment. If you are not going to follow the campaign through with consistency to the end, don’t expect a great response.

If you have accounts receivable at the present time, perform an accounts-receivable transfer. The money you have been carrying on your own books is going to be converted to cash, and that doesn’t hurt when bills have to be paid! The money sitting on your books is doing nothing but losing value for you every day. Conversion of these accounts is excellent business!

Dr. Cathy Jameson is president and CEO of Jameson Management, Inc., an international dental practice-management consulting, lecturing, seminar, and product provider. An accomplished speaker, writer, and workshop leader, Cathy earned a doctorate in organizational psychology, focusing her studies on effective stress-controlled management. Cathy’s books, “Great Communication = Great Production” and “Collect What You Produce,” are top sellers for PennWell Books. You may reach her toll-free at (877) 369-5558, email her at, or visit her Web site at

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