Navigating Dental Care Financing – What You Need to Know

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For patients, financing options provide the opportunity to afford necessary dental care. Often, 3rd party lending providers offer payment plans with low or even zero interest rates for a period, which helps patients fit the cost of their treatment into their budgets. However, it’s essential to understand how these types of loans work and what fees may be incurred.

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As a dentist, you must ensure that every patient leaves the dental office, understanding their financing options and responsibilities regarding repayment. Discussing these details at the front desk allows you to build a trusting relationship with your patients and help them feel confident in their decisions.

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Many dental offices have opted to partner with lenders who specialize in financing for the dental industry. These lenders are generally more flexible and provide competitive interest rates, extended repayment periods, and generous loan amounts. However, consulting with an attorney specializing in consumer finance regulations is essential before implementing any internal financing programs to ensure your office fully complies with state and federal lending laws.

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Know Your Options

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Several options are available for dental care financing, depending on your situation. One such option is a dental discount plan, which is usually more affordable than traditional insurance as there are no deductibles or annual maximums. These plans work by paying the dentist for a percentage of the procedure, usually decided before the visit. 

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Many dental practices offer payment plans to help patients pay for procedures not covered by insurance. However, these programs can be complicated and require significant administrative time. Moreover, these payment plans may deprive the practice of earning revenue through interest charges. Therefore, it is crucial to have a clearly defined policy on patient financing and protocols for discussing it with patients.

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Know What You’re Upfront Costs Are

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Dental care is essential for your health, but it’s often an unexpected expense. It’s easy to forget about your teeth when you have other priorities, like paying bills or saving for a new car or home. Even with dental coverage, it can be challenging to afford the necessary procedures without financing options.

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It’s essential for dental practices to offer financing solutions that meet the needs of their patients. However, creating and maintaining a patient-focused lending program can be challenging.

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While creating a comprehensive financing program with internal resources is possible, some dentists partner with third-party lenders. This can reduce the time it takes to get a loan and make it easier for a practice to comply with state and federal regulations. However, using a third-party lender can limit a practice’s opportunity to earn interest revenue and profit from financing.

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In addition to partnering with financing providers, dentists must discuss payment plans with their patients and encourage them to save for costly procedures before they need them. For example, many employers offer flexible spending accounts that allow employees to set aside pretax money for out-of-pocket medical and dental expenses. Additionally, some dentists can provide a cash discount for patients who cannot pay the total cost of their procedure upfront.

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Know What You’re Expecting to Pay

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Access to affordable dental care shouldn’t be a luxury. However, financial constraints often make this easier for patients. Fortunately, there are many ways to ease the burden of costly procedures.

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Many dental offices offer in-house financing for procedures not covered by insurance. These options typically have a lower interest rate than personal loans, and patients can apply for the loan right in the office.

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Some medical and dental offices offer payment plans that let patients spread the cost of a procedure over time. This option can benefit patients with poor or fair credit scores who may have difficulty qualifying for a low-interest loan through a traditional bank.

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Incentives like these encourage patients to come in for preventive treatment versus waiting until they have an urgent issue, which can lead to higher bills. In turn, this creates a win-win scenario for patients and practitioners. Inspiring patient loyalty through financial solutions is a critical part of practice success. 

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Know Your Options

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There are several resources available to help finance dental work. Besides in-house dental financing and medical/dental credit cards, there are also personal loans from banks and online lenders, which often have lower interest rates than a credit card and offer flexible borrowing limits. 

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Another option is to work with a dental financing company that specializes in providing patient payment plans. These companies can help you implement a financial program compliant with state and federal regulations relating to consumer financing transactions. 

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Additionally, it’s essential to maintain good credit as you prepare for practice financing. Lenders carefully evaluate business and personal credit histories, so making timely payments and minimizing outstanding debts is essential. This will help you qualify for favorable loan terms and improve your chances of being approved for a practice financing program.

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