I’m encouraged to see so many of our colleagues making orthodontic treatment provided by an orthodontic specialist affordable by extending financing and reducing down payments! This trend, combined with enhanced and expanding patient education efforts, is starting to make a difference in many local markets across the country. Patients are starting to understand why our fees are higher than PCDs and why they always will be because orthodontists are taking the time to explain the difference and even do so publicly! As patients come to know and understand why treatment from an orthodontic specialist is worth more, they will be less likely to fall for Groupon ads for $2999 braces or aligner therapy from PCDs who are using it to lure in new patients as a loss leader.
As many of you know I’m a big advocate for extending financing and making orthodontics from an orthodontist affordable as opposed to getting in a price or discounting war that creates a race to the bottom. A solid fee for a solid service allows orthodontists to do what it takes to get a great result in a great environment with great customer service (and maybe even have a little fun along the way). Extending financing beyond treatment time and having low/no down payments allows patients to afford the best without breaking the family budget.
There has been some confusion on how we do our down payment/monthly payments and I thought I would try and clear it up here. Traditionally orthodontists ask for 25% of the fee down and wanted the payments arranged so that the treatment was paid for well before the estimated treatment time. I started out this way because the practice I bought did it that way. However we soon recognized that this payment scheme was unrealistic for many reasons and we were driving patients to seek out lower cost/lower quality PCD orthodontics. We changed – again and again – over the last decade and now offer “no down payment”. This is not the same as “zero down” because we ask for the first monthly payment at the bond appointment. We also allow patients to extend financing beyond estimated treatment time so we will go as low as $99 dollars a month! Crazy right? Crazy like a fox! It’s good to do good while doing good and we are doing very well because we are massively increasing access and affordability to a high end orthodontic office so that patients don’t have to settle for “the cheapest place in town”, “the only place that takes my insurance” or a PCD doing braces. It’s a huge win-win and this model is the future of the orthodontic profession.
Yes, yes, I know… one time you extended financing and were taken advantage of so you won’t do it again. I hear this all the time but the world has changed and I would suggest you change with it. There are a ton of moving parts that must be in place to support this kind of financing – cash reserves to withstand the cash crunch that comes from lowering down payments, auto drafting of every account, strong communication and collection systems and on and on. I will discuss these things in turn.
Have doubts or questions? Contact me and let me know and I’ll address your concerns in future blogs!
Great article, Ben, I’ve recently started offering this and it’s slowly building traction. We already put everyone on autopay but I’m curious about your collections process here as my practice is brand new and we haven’t had to deal with it yet. How does your office follow up with delinquent accounts?
Andy, having patients set up for autodraft makes it possible to offer extended financing. We are not banks and don’t have the ability to act like one. I love increasing access to care and making high quality treatment affordable but the only way I can do that is by using autodraft. Also, it is vital that we orthodontists make sure and help people stay on track with payments. In this day and age it is very difficult for families on a budget to catch up if they get behind.
When I graduated and work for a chain that would also offer $99 per month. The problem was at the end they would hold patients hostage with a $600 retainer/deband fee. This was a marketing failure. If there was a way to succefully collect beyond treatment time without offending patients, I would love to know how.
Glad you brought this up Brian. I think that hidden fees, deband fees, retainer fees, etc are horrible. In our offices we do all inclusive fees. Period. We have segregated financing from treatment time and often finish treatment long before payments are complete. People trust us with their kids and we need to trust them to pay. The vast majority of people will pay even though there will always be a few outliers. Having people set up autodraft payments helps everyone involved to avoid problems in financing that can disrupt treatment. Lots of reputable corporate and owner/operator practices extend financing to increase affordability and access to care and do so successfully. Don’t let your experience with a bad apple ruin this option for you and your patients.
Love this idea in theory. What happens when the patient is still paying off the first round of treatment, doesn’t wear their retainers, and relapses? Or needs new retainers because they lost the first set? We’ve all seen cases 6 months or 1 year into retention that didn’t hold up due to poor retainer compliance. I would have a hard time justifying another fee when they’re still getting auto drafted. Another somewhat rare case I’m sure, but what is your protocol?
Tho this rarely is an issue it does happen. If there is an issue in the first month or two after debond and the retainers still fit (patient has been wearing them) then we retreat fro free. If there is an issue after debond due to lack of compliance we offer GuaranteeMySmile.com – we put braces back on for free and they pay monthly until they are happy. Our patients love having a lifetime guarantee but in the scenario you put fourth it does lead to double payments (but I did my job – the patient dropped the ball). Most people wear their retainers. Most people will continue to pay after debond if you extend financing. The vast majority of people do the right thing. There will always be a few recalcitrant outliers who break the rules and their promises. I write them off as the cost of doing business and living – in my practice and in life! Great question.
Tho this rarely is an issue it does happen. If there is an issue in the first month or two after debond and the retainers still fit (patient has been wearing them) then we retreat fro free. If there is an issue after debond due to lack of compliance we offer GuaranteeMySmile.com – we put braces back on for free and they pay monthly until they are happy. Our patients love having a lifetime guarantee but in the scenario you put fourth it does lead to double payments (but I did my job – the patient dropped the ball). Most people wear their retainers. Most people will continue to pay after debond if you extend financing. The vast majority of people do the right thing. There will always be a few recalcitrant outliers who break the rules and their promises. I write them off as the cost of doing business and living – in my practice and in life! Great question.
Ben,
We are trying to make new policies in our practice after purchasing from an orthodontist with out-of-control accounts receivable. Planning on evaluating insurance/Medicaid/pt balances and cleaning up there as well as getting on the autograft train. What is your protocol for those patients that do fall behind (perhaps don’t sign up for autdraft/credit card)? 30 days, 60 days, 90 days? I would love to hear your thoughts!
Make that “autograft” not “autograft” Not sure anyone would want to be on the “autograft” train!
We use the AAO’s 30,60,90 day policies to deal with those who get behind. Also, generally we will remove braces and stop treatment at any time the patient can no longer afford treatment if they talk to us.