It’s fascinating to me: the idea we will accept an up to 14.9% fee reduction from a company like Care Credit, and then turn around and complain about reduced fees from PPOs.
What do I mean?
Every time you accept a Care Credit payment where you’ve set your patient up for zero interest loans, YOU are paying Care Credit between 5.9% and 14.9%! (Someone has to pay the fees and interest expense to Care Credit – in this case, it’s not your patient that you brought to them, it’s YOU!)
So, for every $1,000 paid to you by Care Credit on behalf of financing a patient, you’re accepting a discount rate of $59 to $149. On every $10,000, that’s a hit of between $590 and $1490. If you finance $100,000 or more through Care Credit every year, you could be paying them $5900 to up to $14,900…just to get access to CASH. That’s a hefty fee.
Compare that to VISA and MasterCard at 1.5% to maybe 2.5% or so with American Express.
If you’re running an 80% overhead, collecting $10,000 leaves you with $2,000 profit and if you give $1490 of that to Care Credit, you actually get to keep a whopping $510 for all the risk you’ve taken on generating that $10,000. Does a benefit of just $510 seem like a “good risk” to you?
You may be aware that earlier this year, I started a dental office franchise. And, part of the vast majority of franchises, a royalty is paid to the franchisor for the use and license to certain intellectual property, processes, systems, training, and so on.
It’s equally as interesting when speaking to Dentists about our franchise that when I tell them our franchise royalty, they “feel” it’s too high. Yet, they have nothing to compare it to. There’s nothing like what we do in the marketplace of Dentistry today.
So, for those analytics reading this, I offer the comparison of Care Credit.
Because, that Care Credit discount of between 5.9% and 14.9% gets you cash only. It does not get you training for you and your team (like how to extend financing to patients and BE the bank and potentially generate interest income), support to run your practice, marketing to generate and retain patients, best practices to grow and expand to multiple locations and so on…it just gets you a lump of cash at a HUGE price. That’s it.
Which would you rather have? A partner interested in your success and one who’s always there for you to push you to succeed, or, just a chunk of money with a huge hole in it?
I think the answer is clear. To learn more about our Wellness Springs Dental® Office Franchise, just click on Discovery Days above to learn more and apply to attend our next Discovery Day.