cash pay discount and payment methods

[gyzeus]

I went to my dentist a couple of days ago to get a check up and happened to overhear the financial counselor explaining to a patient on their payment policies. I had some question on some of the payment methods which includes cash/check pay discount and some kind of low monthly plan that the clinc offers.
For the cash/check pay discount, do many dentist offer this benifit to their patients? I forgot the exact numbers but they mentioned a 5% and 10% discount for some of the procedures. Sounded like a good policy because the patient seemed delighted by the offer. But I was wondering if these kinds of conditional offers are actually legal?
For the low monthly payment plan, I'm not sure if I got it right but it was like the clinic was running their own insurance company where the patients had to pay around a $90-$100 monthly fee to get coverage on most of the procedures except for cosmetics. This sounded like a really great idea since it would benifit the patients and dentist without unnecessary money leaking out into insurance companies. I was thinking, if more dentists provide such payment plans and things work out well, we might not even need the goverment to get involved.

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[Regmata]

Sounds shady to me. It is probably more like an increase if you don't pay cash...

 

[UCSF2012]

There's nothing illegal about it. Patients can pay in cash if they wish, like all other transaction in america. The dentist can even create his own insurance plan. Take the $100/mn, give him a powered toothbrush so ensure he brushes properly, give him cleaning twice a year to monitor his dental health, and do the occasional cavity fill. He could make more for that patient per year than he normally would.

 

[gyzeus]

Sounds shady to me. It is probably more like an increase if you don't pay cash...

Do you mean it would be a lost for the dentist to accept cash?
Then I don't get why they even offer this payment option?..

 

[Regmata]

Sounds like the dentist would be screwing over the patient. At least, that would be the case in my situation since my dental care typically only costs me $150 a year...but I take care of my teeth. I am sure that there are plenty of patients out there that would benefit from this sort of plan. I am also sure that it is profitable for the dentist, otherwise they would be a ***** to implement it. Truth be told, I don't really know anything about billing practices yet...this was just the first conclusion I jumped to.

 

[gyzeus]

The dentist can even create his own insurance plan. Take the $100/mn, give him a powered toothbrush so ensure he brushes properly, give him cleaning twice a year to monitor his dental health, and do the occasional cavity fill. He could make more for that patient per year than he normally would.

This sounds like a good method to get insurance companies out of dentistry..and if more dentist provide their patients with these payment options and things go well we wouldn't even need socialized dentistry..
The patients could be on a 1 year contract and if they don't like their dentist then they could just cancel the contract which would only be fair..
And now that they are insured they would come more often to the dental office to get a checkup which would provide them with better oral health care..and this would save the dentist from complicated procedures..

 

[tamkhan]

This sounds like a good method to get insurance companies out of dentistry..and if more dentist provide their patients with these payment options and things go well we wouldn't even need socialized dentistry..
The patients could be on a 1 year contract and if they don't like their dentist then they could just cancel the contract which would only be fair..
And now that they are insured they would come more often to the dental office to get a checkup which would provide them with better oral health care..and this would save the dentist from complicated procedures..

Yes, but it couldn't possibly cover any of the high end procedures. Plus, it would mean that the patient wouldn't be able to get his/her teeth fixed if they were in another city. Insurance allows for such flexibility.

 

[gyzeus]

That's the same question I had too when I overheard that in the office.. I don't know about the details on what procedures the plan covers but I think there were limits on the price and certain procedures along with some of the benifits for the patients.. They will probably explain that to me in my next visit..
But I was thinking that they were perhaps trying to focus more on prevention at an affordable price range trying to get the patients in the office so that they can get checkups and treatments before they would need those high range procedures.. Getting a checkup and cleaning every 4 months would be more than enough to prevent the patient from needing to get those high range procedures..

 

[MONKEYBOY]

Using credit and debit cards removes 3-7% from the transaction to the company issuing the credit card.

$100 paid with a card =(may equal) $93 paid to the merchant.

Offering the patient a 5% discount by paying cash simply saves the merchant 3% in this example.

Since writing checks is becoming a thing of the past, I can easily see why a dental office would suggest this to patients.

FYI: American Express charges the highest transaction percentage rate, which is why it's rare that merchants accept AmEx. I have one of these cards, and it is essentially worthless since it's rare for anyone to accept it.

My $0.02.

Shady? Any dentist is claiming all income, so giving cash, checks, cards, paypal, etc are ALL declared as income come tax time.

 

[gyzeus]

I knew there was a transaction fee but 3-5% is quite huge!
I thought it was a bit shady too since they could just not report the cash and checks when they file tax.. because coming to think of it, even some of the receptionists at my physicians office asked me to rewrite my check directly to the physicians name when I wrote the name of the clinic..

 

[Regmata]

I wasn't referring to the cash discount aspect of it.

 

[toofshucker]

Like someone above said, a lot of dentists will give a cash discount for 2 of many reasons. 1) They keep the credit card fee difference. 2) They get the money before the patient walks out the door. I think that is crazy, but dentists seem to be the only profession where they don't feel it is necessary to receive money the day they work and/or if they do receive that money, they feel it is acceptable to take less than they worked. No other worker feels that way.

 

[charlestweed]

For the low monthly payment plan, I'm not sure if I got it right but it was like the clinic was running their own insurance company where the patients had to pay around a $90-$100 monthly fee to get coverage on most of the procedures except for cosmetics. This sounded like a really great idea since it would benifit the patients and dentist without unnecessary money leaking out into insurance companies. I was thinking, if more dentists provide such payment plans and things work out well, we might not even need the goverment to get involved.

A lot of dentists and other health professionals use financial companies like Carecredit and Unicorn to get more treatment acceptance from their patients. With Carecredit, patients can make monthly payments w/o paying interest for up to 18 months. Most dental insurance plans don’t pay for dental implants. CareCredit payment options allow patients to get implant treatment the same day without paying a huge amount of money up front.

A lot of orthodontists offer interest-free payment plan for their patients. To start orthodontic treatment, patients simply pay the down payment…. and the remaining balance will be paid monthly in 12, 18, 24,or 30 months (depending on the duration of the ortho treatment). This really makes orthodontic treatment more affordable for patients who don’t have dental insurance or their insurance don’t have orthodontic coverage.

 

[meowx3]

i work for my dad, who's a dentist. patients who pay cash pay less because then he doesn't have to pay a cc transaction fee, as said by a couple ppl already. the dentist gets paid the same either way, and it's not shady; it's not like he pockets the money and buys van goghs off the black market or anything.

if it's just a check-up/cleaning, there's not much difference (i believe the cc fee for his office is 6 or 7%), but he's a prosthodontist, so if someone comes in for dentures or something, it can save the patient a few hundred dollars.

 

[clee1979]

Well all my dental work cost around 2935.00 i had a cleaning full mouth xrays, 4 cavitys also 4 wisdom teeth going to be be pulled by a oral surgeon for 2000.00 bucks and you know what we heee i do not have any dental insurance i am paying cash for all of it!!! i am so thankful my grandfather left me a trust fund!!!! Thank God!!!

 

[burberrry]

Like someone above said, a lot of dentists will give a cash discount for 2 of many reasons. 1) They keep the credit card fee difference. 2) They get the money before the patient walks out the door. I think that is crazy, but dentists seem to be the only profession where they don't feel it is necessary to receive money the day they work and/or if they do receive that money, they feel it is acceptable to take less than they worked. No other worker feels that way.

This is so true (at least for the noble dentists, which there are a lot of ).

Paying in cash, esp. the day of their appoint = no worrying about collections. It's not rare to have accounts receivable be up to $100,000 (or even $200,000 for some)--a lot of money that could improve the practice and thus gain a greater patient base.

Plus, insurance companies can be such a pain, and it doesn't help when patients blame the practice for their insurance declining coverage for a procedure.

 

[MNdental]

I work on the administrative side of a dental clinic and can address these questions:

1) in office discount plan. This is NOT insurance. Something you often find at chain clinics. Pay ~$50 and get 20% off your services. Only applicable for those without insurance or for non-covered services. Give the patient an incentive to return to your clinic. Also, see bottom paragraph.

2) cash discounts: this INCLUDES credit card transactions typically, so the above discussion about credit card processing fees would be irrelevant, at least in our clinic. You get a 5% cash discount because of the money saved by not having to submit/process/appeal any claims, you don't have to way 20 days to get the check, forces the patient to pay on the day of service, and it also encourages the patient to come back because they feel like they are getting a good deal. Also, see bottom paragraph.

Here is the important part: being in-network with an insurance company will involve you applying a lower contracted rate for your services. At our clinic, that seems to be about 15-25% depending on the service. So a 5-10% discount for cash patients often winds up being more revenue than they would get from an insured patient. In addition to being much less hassle. Cash patients are good.