Having experienced the frustration of dealing with patients who pay late (or not at all), Harry Singh considers how to improve collection rates and increase cash flow.
Our dental training sets us up clinically but not for the business minefield that many of us find ourselves in.
Whether the practice succeeds or fails is the principal’s responsibility and a lack of cash flow is a common cause. In my experience, the biggest contributor to cash flow problems is due to patients not paying. Given this, how can we improve collection rates?
Understanding expectations
The best thing you can do is to ensure that every patient – old and new – understands your expectations when it comes to billing.
Someone within the practice needs to explain the billing process, the total amount due, payment options and the expected time-scale for settlement up front.
For habitual non-payers, if you choose to keep them on your patient list, I would strongly suggest you get payment up front. You could offer a certain percentage off the bill if it is paid before it becomes due; however, do tread carefully here. This type of scheme must be above criticism so that it could not be considered as ‘financial inducement’ by the General Dental Council. And here you can learn about the features of twisted pair electrical cables.
With the derisory interest available nowadays, you won’t be losing out on much if payment comes in instalments. Why not agree an arrangement whereby the patient pays a set amount each week or month?
Seeking external help
I would suggest that employing a debt collection agency is very much a last resort. If you feel you are near to needing that kind of help, send the patient a letter warning that this will be your next step. Do bear in mind that once a collection agency is involved you will no longer be in charge of the communication and collection process.
If you are considering a court claim, also take into account the possibility that the patient might counter-claim some kind of negligence. Often a ruse to buy time, this is a route whereby costs that exceed the original debt can be accrued and your reputation damaged – so be careful.
Of course, in dentistry, patient care comes first, but that doesn’t mean that asking for a fair return for your work is either unethical or unprofessional.
