Almost every time I help an office establish a dental savings plan, I’m asked if they should allow patients to use 3rd party financing (like Care Credit or LendingTree) for their dental treatment – like they allow for their “regular” patients to do. In their minds, they’re already reducing their standard fees for plan members, so should they really take on a financing fee on top of that?
It’s a great question – but it has an “It depends.” answer.
Here’s the way I see it…
If you are a PPO practice
If you are a practice who is already accepting PPOs and letting those patients use financing, then I say let your dental savings plan members use it too. You’ll probably find that your overall PPO write-off (standard fee – PPO fee discount – 3rd party write-off) is greater than your DSP writeoff. (standard fee – DSP pricing discount – 3rd party write-off).
Your in-house plan should not have fees less than any PPO you accept!
PPO patient write-off with Care Credit > DSP patient write-off using Care Credit
If you are a Fee-For-Service practice it’s really up to you.
If your discount plan is conservative, then you may be comfortable with an additional write-off in addition to your dental plan’s savings, especially if it’s for a short payoff time frame (like the 3 month option…so your fees will be lower than the 6, 9, or 12 month options).
Since increased production is a major benefit of having a dental savings plan in your practice, you may want to allow third party financing so affordability is not a roadblock for some of your patients.
However, I do work with practices that flat-out disallow any financing options for dental savings plan members, and that’s certainly your prerogative to initiate in your office as well.
That’s the beauty of a dental savings plan. You get to make up your own rules – and no one, including an insurance company, is telling you what to do.
One important caveat…your monthly or yearly recurring plan enrollment fee should never be financed!
If you’re using plan management software for your enrollments and automatic re-enrollments, you likely don’t have the option to set up financing, and why would you want to? It is never an issue with a monthly recurring enrollment because the dollar amounts are quite low. For an annual plan the membership fee can sometimes be a few hundred dollars, so on occasion a patient may ask if you’ll allow them to split-up an enrollment fee instead of enforcing it to be paid in full.
Here’s where I would hold my ground and not allow it.
I assume you took great care in constructing your annual plan, and if you’ve done it right the patient would be saving money at the very first visit he or she joined. If that patient fails to return to your practice and you’ve let him or her pay only a part of the enrollment fee, you won’t be pleased.
Costco and Netflix don’t let you make partial payments on their subscription services, and neither should you.
If you’d like to learn more about dental savings plans and how they can benefit your practice, you’re invited to join the Recurring Revenue Revolution Facebook group.
