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DENTAL TRIBUNE | April 2010 Industry News 15A In 1980, when we took our first dentist as a client, almost all den- tal offices were routinely granting credit to their patients. If a patient/ parent needed a few months to pay for his/her clinical treatment, a payment plan was usually allowed. Thirty years later, things have clearly changed. Dentists today rarely grant credit because they don’t want to assume the risk. Patients are pushed to pay in full or to use third-party financing. In fact, many of the practice management consultants who are active today are recommending their dental clients be “cash only” and only provide third-party financ- ing (finance company, bank, credit card) for their patients. The result is simply horrible rates of case acceptance, post- poned/phased treatment, more single-tooth treatment than ever in the past, significant increases in failed appointments, a reduction in the number of new patient referrals and a net reduction in production per dentist hour worked in many practices. This defensive behavior is unnecessary because credit grant- ing, internal credit granting, is safer and more productive today than it has ever been in the past! While choosing not to grant cred- it, to be a cash-only practice, solves some delinquency and cash flow problems, that policy often makes other problems worse. Failed appointments do not improve, and often become worse, because when money is tied to appointments, patients often find good reasons to postpone or cancel the appoint- ments and, in more serious cases they simply become a “no show.” Although collection rates are good, actual cash flow does not improve because of the single big- gest problem with being a cash- only practice, weak case accep- tance. If your patients are not having you perform the work you have diagnosed, or if they only accept work covered by insurance, your production will be down and cash flow will be down as well. Ulti- mately, being a cash-only practice contributes to the biggest problem of all: poor referrals and weak new patient flow. Let me note that there is no legal, ethical or moral reason why any dentist needs to grant credit. The only reason to grant credit is the obvious and practical one: You will have more patients who will accept more of your diagnoses. It is not a coincidence that dur- ing the last three years, while our economy has been less than stellar, practices that routinely allow their patients monthly payments for their treatment have experienced significantly less of an impact from the economy than have the cash- only practices. Appropriate credit granting is often the answer to building a consistently growing, productive and profitable practice. Of course, “appropriate” is the operative word. While you cannot afford to have your great patients postpone their treatment because of your financial policies, neither can you afford the financial loss and other problems associated with granting credit to the wrong patients. Obtaining credit reports on patients was the answer to this dilemma in 1980, and it is still the answer today. The difference today is that learning a patient’s potential risk to the practice is much less expensive, less intrusive, less time consuming and much more accu- AD Using risk identification and credit granting to build your practice By Paul Zuelke rate than it has even been. The Zuelke Automated Credit Coach (ZACC) is a Web-based tool available from DentalBanc that has been specifically designed for the dental profession. ZACC evaluates stability, maturity and credit integ- rity in exactly the same fashion as a bank loan officer, but ZACC does it in a few seconds. Once ZACC has evaluated your patient/responsible party, ZACC g DT page 16A