5 Secrets to Eliminating Accounts Receivable
AADOM
How to Make AR a Thing of the Past Starting with These 5 Secrets to Set Up Financial Arrangements So You Never Have to Chase Your Money Again
If you are feeling the AR pain in your practice, with a significant proportion of dentistry charges unpaid for 30 days or more, you are hardly alone. Based on my experience with hundreds of dental practices, fully 80% have trouble on this front.
AR, however, is NOT the problem.
It is a symptom of the real problem – a broken financial arrangements system. The right financial arrangements system ensures that payments are made promptly – not just on time but in real time. Now, it’s to the benefit of both the practice and patients to have the money matters mutually understood and comfortably settled on the way into treatment, so the patient feels nothing but healthier and better on the way out!
What follows are Five Secrets to better financial arrangements and eliminating accounts receivables once and for all.
ONE: Internal Financial Guidelines
The IGF is the first of two mission-critical documents in banishing AR once and for all. It is an internal document for the practice team. It clearly lays out, in writing, all the financial options available to patients as well as what can’t be offered, and how these options are handled and presented.
Everybody on the team needs to be in the know about financial matters. Why? Because sooner or later everybody, no matter their position in the practice, gets asked about financial things and must be knowledgeable.
When a dental assistant gets asked, instead of saying, “I don’t know anything about that. It’s not my job,” the optimal response would be “We have a lot of easy payment options. Charlene is our expert in that area and will help you with all the details. Let’s go ahead and wrap up here and then have you speak with Charlene. Sound good?”
It does sound good, even better when the assistant speaks from a working knowledge of what Charlene can offer.
While every practice differs as to what payment options are provided, there’s one bedrock principle that the team needs to understand: A) Your practice is not a bank. All treatment provided has a clear financial arrangement for payment that goes with it, and is understood and agreed upon with the patient. Also foundational is B) All options are in writing in your practice’s Internal Financial Guidelines, and your whole team is familiar with those options.
TWO: Financial Relationship Form
To be shared with the patient and signed by the patient, this is a written two-way commitment for both the patient and the practice.
Pay attention to the R-word above: Relationship.
Many practices present patients with a “Financial Policy,” which feels one-way and, worse, top-down. Instead, the Financial Relationship Form expresses commitments that are truly mutual. This includes the commitment on your part to present clear and understandable financial arrangements for all treatment, which will always be in writing. The FRF lays out how dental insurance savings are handled, how payment information is kept secure, and the range of options available.
On the patient’s part, there’s a commitment to follow through on agreed-upon financial arrangements. And it’s clear that financial responsibility rests on them, for their benefit. This document, reviewed and signed by both parties, is a two-way street that outlines everyone’s responsibilities in a cordial patient-friendly manner.
THREE: Third-party Financing
Here’s a question you can ask the patient when you’re presenting payment options: “Would it help to know that you don’t have to pay for all of this today?”
The answer will likely be a resounding “Yes!”
How about all the unscheduled treatment in your patient charts? For many patients, the unexpected expense is too much to even consider moving forward with treatment. On their next visit or even a proactive follow-up call, ask: “Would it help you move forward with the recommended treatment if you knew you did not have to pay for it all at once?”
This question is the door that opens the conversation about third-party financing options. Financing services and technology have come a long way, and it’s vitally important to keep up with developments and work with a provider with up-to-date, real-time services for patients to lock in financing instantly and easily.
For a good, working example of what cutting-edge financing looks like, check out Sunbit, which provides access to financing options for over 85% of patients with a fast, digital application and no hard pull on their credit when they check their options.* It is an essential tool to have in your financial arrangements toolbox.
FOUR: Credit Card On File
Here’s another tech solution that benefits us all. The patient doesn’t even need to take out their plastic to settle charges by credit card payment when card information is on file. But note, please, that there’s an important legal technicality involved: “On file” does not mean on file in your office – not on paper, stored digitally, or in any way, shape, or form that’s yours. This is nothing less than federal law. Not to worry, charges can be made instantly, through any number of credit card processing services that meet PCI (Personal Credit Information) legal standards. All it takes is the right setup in coordination with your payment processor and patient permission to use their properly entered and stored information to settle charges on balance.
FIVE: No More Paper Statements
For those who’ve been in the game for a while, mailing out printed monthly patient statements is a hard habit to break.
Get over it!
Cancel this old-school ritual that once made sense but now wastes:
- Valuable time and effort for you and your patients
- Paper, envelopes, and printer supplies
- Postage
To reach patients and facilitate payment in real-time, we highly, highly recommend texting patients and utilizing a text-to-pay option. A short, sweet greeting followed by a simple message stating what services charges are for goes a long way. Here’s an example: “Hi Barbara. Thank you for visiting XYZ Dental Practice. Your remaining unpaid portion is $XXXX. Click to pay here today.” Another tech triumph to simplify life for patients and business for practices.
The real secret, behind these Five Secrets, is patients don’t like AR problems any more than we do and welcome whatever gets them out of the way. Having the right tools and systems in place combined with the right verbal skills for presentation eliminates AR, keeps collections on track, and makes everyone happier, especially you and your patients.
About the Author
Steven J. Anderson is the Founder of the Total Patient Service Institute which implements the highest level of patient service and case acceptance systems in dentistry. For a FREE copy of the ebook: “I Can’t Afford It” packed with even more financial arrangements secrets, go to: bit.ly/3IcExPR
To learn more about Sunbit, the fastest-growing patient financial technology company and the 2nd largest in the dental industry, click here.
