I applaud their generosity. But the most common experience was they ended up losing both the patient and the money. Many of these people couldn't make the payments, so rather than come back, they went to another dentist, and often times paid the second dentist to finish the work the first dentist started essentially for free.
Accounts receivable is bad business, to be sure. But self-financing is also bad marketing. Statistically, if you have payments more than 90 days overdue, you can be 90% sure you will never see the money.
So why do dentists do it? To be a nice person? Because the patient had been a good patient for a long time? Because the need of the patient was so extreme they didn't feel they could ignore it? All good reasons, but the unintended consequences are most often negative. As Shakespeare said, "A loan oft loses both itself and friend."
Sometimes there's a deeper reason, that dentists are so overwhelmed by the constant whining about the cost of dentistry that they devalue it in their own minds. And that's where the unconscious marketing message comes in: when you agree to self-finance, you're telling the patient that even you don't believe you deserve the money and that you're too expensive. That's why they're so comfortable not paying you. You think you're building loyalty, but instead you're compromising on your value position.
I'm going to make an absolute statement. There should be no accounts receivable in your practice.
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This blog post was re-posted with permission from 1-800-DENTIST.
Fred Joyal is the Co-Founder of 1-800-DENTIST, and author of the book Everything Is Marketing: the Ultimate Strategy for Dental Practice Growth. He has worked in the dental industry for 26 years, and has helped thousands of practices grow with new patients and with marketing guidance. He speaks all over the country on dental marketing, social media, and practice management.