February 2015
Volume 11, Issue 2

Clear Financial Policies Increase Patient Loyalty

Effective ideas for handling a sensitive issue

Rhonda R. Savage, DDS

People who owe you money do not like you. They feel guilty when they’re late with a payment and burdened because they’ve procrastinated. Clear financial policies will decrease patients’ stress. They are a very important part of customer service, especially when they’re presented by a warm, empathetic, knowledgeable staff member. For these policies to be effective, they must be well understood by staff and backed up by the doctor.

Establishing Financial Guidelines

Doctors and team members need to sit down together and write out the office’s financial guidelines. The collection of the money is the responsibility of the entire team, but one person—a designated “financial coordinator”—should be in charge.

Have you ever noticed that patients may try to go around the front staff and ask the doctor for a discount or professional courtesy? Or maybe they’ll ask the kind-hearted doctor if they can pay “over time” instead of paying as the treatment is completed? That’s why, once the policies are established, the doctor should defer all financial discussions to “our experts at the front desk.” Regarding courtesies, consider a professional discount limited to a specific amount, perhaps $50, rather than extending a courtesy on a percentage basis.

If the office offers a cash courtesy, it should be reserved for those paying fully in cash. You should be aware that if the patient has dental insurance and you’re a PPO provider, you may be required, by contract, to offer the same courtesy to the insurance company.

Some patients ask to be billed rather than pay at the time of service. To prevent this in the future, the author recommends delivering a “Change of Policy” letter. Make sure the message is clear, as in this example:

“Due to the high cost of billing and insurance management, we have had to make a change, and we were faced with two choices. We could either add more staff—which would mean an increase in our fees—or ask all patients to pay their non-insurance portion at the time of service. Our desire is to continue to provide you with high-quality service at a reasonable fee. For these reasons, we are now asking all patients to pay any non-insurance balance at the time of treatment. We will provide a pre-estimate with each appointment, so you’re aware of your estimated fee. We accept cash, check, credit cards, and CareCredit. All payments will be made same day, to ensure quality service and cover all lab costs. If financial arrangements are needed, please speak to the financial coordinator. If financial arrangements are then agreed upon, there is a re-bill fee for any balance that is not paid for within 90 days. The re-billing fee is $12 for every 30 days after the initial 90 days. As a courtesy to our patients, we will bill your insurance, and follow up if the insurance hasn’t paid by the 30-day mark. After 90 days, you are responsible for the entire portion. Our office will contact your insurance company to help with the process.”

I would not recommend mailing a letter with this information. Don’t surprise the patient. A surprised patient becomes an embarrassed patient, who then turns into an angry patient! Discuss the changes and present the letter in person, upon checkout of the patient. Have a staff member tell the patient, “You’re okay for today, but at your next visit, you’ll need to be prepared to provide payment.”

This policy is then reinforced at subsequent visits. For example, a patient, Sarah, is prepared for the need to provide payment by the assistant or hygienist as she is escorted to the front: “I’ll be walking you up front to Marcia, who will write you a receipt for today’s visit and make your next appointment.” Marcia says, “Thank you, Sarah. Your fee for today is $375. Will that be cash, check, bank card, or CareCredit?”

Determining the Options

If a treatment is extensive, consider breaking the patient’s portion into three segments, with one third due at the beginning appointment, one third halfway through the treatment, and the balance on or before delivery. If the treatment is done in two procedures, the office may require the entire amount to begin, or split it into two payments if the patient requests.

For well-established patients with a great track record of on-time payment, consider half down and the balance in 90 days. If the treatment at the chair changes, those patients must be informed, prior to treatment, about their new financial obligations. Never perform until you inform. While making financial arrangements, present the patient with a written treatment estimate; have the patient sign one copy and keep one copy in the patient’s record, even if the office is chartless.

Consider the following as you develop a financial policy for the office:

• What is your position on fees involving lab work? Many offices require the full fee upon the prep date, especially for milled restorations created in the office.

• What is your policy for emergency patients? Consider having an emergency registration office visit fee collected before seating.

• What is your insurance co-pay policy? Collect co-pay and deductibles that are due at the time of service. Collect slightly more than the patient’s portion if you are not certain of the fee schedule the insurance uses, assuming you accept assignment of benefits. Or, another option is to have a credit card on file for the after-insurance balance. This is the most difficult portion to collect. Patients are resentful because they paid what you asked at the time of treatment; you received the insurance payment, and they don’t understand why they need to pay more.

• What is your cash courtesy policy for patients who pay with credit cards? What is your policy for “professional discount” if the patient has an insurance you are billing? I do not recommend extending courtesies in either of these situations.

• Consider a source of outside financing, like CareCredit. I’ve personally worked with CareCredit for 18 years. I especially like CareCredit because outside financing is a “win-win” for the patient and the doctor. When patients pay their percentage off prior to the end date, there is no interest. The win for the dental office is that costs are covered up front for the treatment, improving cash flow. Also, patients seek my practice out because I’m a CareCredit provider.

Loyalty Is the Payoff

Patients want a reasonable price and a way to pay for dentistry. Patients will pay more and accept more dentistry if they feel the value exists and they can afford to “shop up.” Even the wealthiest patient appreciates a way to pay something off without a finance charge, which is where options like CareCredit can make treatment decisions easier for the patient.

The world has changed with regards to marketing, case acceptance, and customer loyalty. We do know that loyal patients sing your praises. Patients want consistent friendliness, a reasonable wait time, a relationship, a good atmosphere, and more. Patients want choices, and they don’t like financial surprises.

Firm, consistent financial policies are one layer of the customer service that our patients today deserve and expect. To assess the financial health of your practice, I’d ask some questions: How healthy are your accounts receivables and your past due insurance? How healthy is your profits and loss statement? Do you have a written financial protocol?

I challenge you to have an open, honest, productive team meeting and look at your financial policies. Both your practice and your patients will benefit.

About the Author

Rhonda R. Savage, DDS is the CEO of Miles Global, a national dental management and consulting firm. She is an esteemed author and lecturer on women’s health, practice management, and leadership skills. For speaking or consulting information, visit www.MilesGlobal.net

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