The Guide to Offering Financing at Your Dental Practice

Because everyone needs dental care, your patients are diverse. The individuals and families that visit your practice have a range of financial circumstances. Their health care plans (or lack thereof) and payment preferences are varied. 

Offering financing is one of the best ways to reduce financial barriers to dental care. Financing is appealing to patients who are unable or reluctant to make a single lump sum payment at the point of service. They can instead elect to make smaller payments over a time period that better suits their financial situation. 

Limited payment options prevent some potential patients from seeking dental services at certain offices. By offering financing, your practice becomes accessible to a broader patient base. 

Let’s discuss financing for dental practices, including:

  • Reasons why your dental practice should offer financing
  • How to provide financing options at your dental practice

Reasons Why Your Dental Practice Should Offer Financing

Is it time for your dental practice to consider offering financing to your patients? 

Practices offer financing for the following reasons. 

Better Payment Options for Uninsured Patients

It’s estimated that over 76 million American adults (30 percent) lack dental insurance. 

The uninsured are not a homogenous group. Some individuals are between jobs or transitioning from one life phase to another, such as young adults entering the workforce or older adults entering retirement. 

Since health care is often obtained through an employer, transitional phases sometimes involve a lapse in health care coverage. 

Some people simply choose not to pay for dental care, viewing it as an extra cost that may compete with their other health care needs. For these individuals, dental care becomes a pay-as-you-go expense. 

For many patients, lacking insurance is a short-term situation. However, sometimes care is needed urgently, and it’s not possible to wait for insurance to kick in before making an appointment. 

If your practice receives many inquiries from uninsured patients, then it’s likely that a substantial percentage of your patients and potential patients would benefit from a financing option. By offering financing, you’ll attract more new and returning uninsured patients. 

Meet Demand for Expensive Specialty Services That Aren’t Covered by Insurance

Among patients who do have dental insurance, financing options are appealing for procedures that aren’t fully covered by their plans. 

Many insurers offer the 100-80-50 scheme, covering:

  • 100% of costs for standard preventive care
  • 80% of costs for basic procedures, such as fillings and root canals 
  • 50% of costs for major procedures, such as crowns and implants

For expensive procedures, a patient with a 100-80-50 plan may be left with a bill that’s unmanageable as a one-time payment. 

Cosmetic procedures, such as whitening, are typically not covered at all. 

To make more services feasible for more patients, offer financing. The availability of financing may be the difference between a patient opting in or out of a desired procedure. 

Increased Earnings From Interest Payments

As a health care provider, charging interest on financed payment plans is legal and normal. Charging interest motivates on-time payments and provides your practice with extra revenue. 

State and federal laws apply to interest rates and the manner in which you apply interest charges. Your advisor can help you to determine appropriate rates. 

Some patients may resent interest charges or find them confusing. To avoid conflict, always provide clear information when presenting patients with payment options. 

How to Offer Financing at Your Dental Practice

If you’re considering offering financing at your practice, schedule a meeting with your CPA to discuss the parameters of your potential financing program. 

The details you’ll work through include:

  • In-house financing vs partnering with a lending organization
  • Which services to offer financing for
  • Whether or not to offer financing for insurance copays that exceed a certain amount
  • Whether or not to charge interest and at what rate(s)
  • Whether to offer 100% financing or partial financing 

The goals behind your decision to offer financing can be reflected in the program’s details. For example, if you’re interested in expanding your appeal as a cosmetic service provider, you can include those procedures in your program. If you’d like to provide preventive care for more low-income patients, you can offer low- or zero-interest financing. 

One of the most significant considerations you will have to factor in your decision to offer financing or not will depend on whether you decide to offer it in-house or through a financial institution. If you are offering it independently, you may have more flexibility with the terms that you are able to set or negotiate with your patients directly. 

Should you decide to offer it through a financial institution, there may be more items that need to be accounted for, more documents needed, and more qualifiers that a patient must meet to obtain their financing. This may limit certain patients’ ability to obtain financing but you will not have to manage it in-house and can outsource the administrative aspects to a professional service provider. 

Work With Dental CPAs to Create Your Own Financing Program

At Ducket Ladd, we’re a team of dental advisors and CPAs. Our sole focus is the dental industry. 

If you’re interested in exploring financing for your dental practice, we can help. Contact Duckett Ladd today to speak with one of our dental practice financing experts. 


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