ADA News

Editor's note: This is the first in a three-part series educating members about patient financing. Part one focuses on the benefits to the dental practice.

From the patient's point of view, the cost of a dental procedure can be a little less daunting with more time to pay.

Dr. Paul Homoly communicates on case acceptance via ADA CE Online In "Making it Easy for Patients to Say Yes," a continuing education course available on ADA CE Online, Dr. Paul Homoly discusses communication techniques that could be used by the dental team when it comes to case acceptance by patients, including the importance of discussing budget and financing with the patient prior to treatment. Dr. Homoly's course is at www.adaceonline.org. Special pricing is available for ADA members and dental team members.

In this economy, consumers are less willing to put more debt on their regular credit card and don't always have money on hand to shell out for a one-time payment. Many dental patients have also lost their insurance or have weaker coverage than in years past, prompting them to offset extra costs from their own wallets or opt out of recommended health procedures.

These circumstances and a willingness to make dental expenses easier on patients are why many dental practices are offering patient financing services. These types of programs were thriving before the economy tanked, but a weaker economic climate gave dentists even more of an incentive to offer patient financing to their patients.

Allowing patients to finance their bills through a third-party company allows dentists to be paid for their services in a timely fashion. It also allows patients the time to spread out the payments so it's not a huge strain on their budgets. It can work similarly to a department store credit card, and patients can find out on the spot how much credit they’re allotted.

Doctors have found patients are more willing to take advantage of elective or necessary procedures; they spend fewer resources on in-house billing; and are able to preserve a positive doctor/patient relationship, according to Dave Fasoli, president and CEO of CareCredit, the largest player in the patient financing sector among dentists, holding about 64 percent market share.

"What we hear from consumers is if they owe the dentists money and sometimes they're behind, they're sometimes less likely to go to that follow-up care than if the debt was associated with a third party," Mr. Fasoli said.

About 130,000 medical practices utilize CareCredit, with 85,000 being dentists, Mr. Fasoli said. Other companies like Citibank also offer patient financing services for dental practices.

Doctors will typically approach patients with a financing plan after they diagnose what procedures need to be performed, said Kay Valentine, office manager for Dr. Gary Llewellyn, a dentist practicing in Indianapolis, who contracts with CareCredit. The patient then meets with a treatment coordinator, and they work on a plan that fits within the patient's budget, and they're given options for how to make it work, Ms. Valentine said.

"It's just like if you were going to go to Sears and apply for a credit card," Ms. Valentine said. "They tell you right there on the spot if you were approved."

Once the patient figures out how much money he or she is allowed to finance, a payment schedule is developed. They can finance their treatment at no interest anywhere from six to 24 months or do an extended payment plan up to 60 months with a competitive interest rate, Ms. Valentine said.

CareCredit pays the dentist, and the patient pays the company. CareCredit is the only patient financing company endorsed by ADA Business Resources.

DentalBanc, a Chattanooga, Tenn.-based company, offers an alternative way for patients to finance their bills. DentalBanc acts as a collection agent for dentists and helps them establish patient financing within their offices, said Marla Merritt, director of sales and marketing for DentalBanc.

Dentists purchase a credit recommendation from DentalBanc, which will state what each patient’s risk is; whether they are likely to pay their bill on time or default on their payments, Ms. Merritt said. Based on the rating, DentalBanc recommends a payment plan and timeline for the patient, she said.

If the doctor decides the patient warrants a financing schedule, DentalBanc will electronically draft money from the patient's credit card or checking account on a monthly basis. If the person isn’t able to pay, DentalBanc does the grunt work of contacting the patient, Ms. Merritt said.

"We do all the patient interaction, but we're not guaranteeing the funds, and we're not providing the funds up front," Ms. Merritt said. "It's not creating extra work for the dental staff, because we are totally managing it."

More than 2,000 dental practices utilize DentalBanc, Ms. Merritt said. Among all the dental and orthodontic practices the company contracts with, DentalBanc maintains a 99 percent success rate in collecting the funds within 30 days of the original due date, she said.

Citibank offers flexible payment plans through its Citi Health Card program, which supplies consumers who qualify with a credit card dedicated to health care needs.

"The biggest obstacle to treatment acceptance is often affordability, so patients/clients value the flexibility of low monthly payments and no down payment. Plus, it can be used as needed for additional treatments and other family members, up to their credit line," according to the Citibank website.

Part two of the ADA News' patient financing series, scheduled to appear this summer, will discuss the criteria for choosing patient financing programs.