Do you have a policy for discounting fees in your practice? Check out today’s episode to find out my take on discounting fees and see how I have changed my philosophy. Thanks for tuning in…
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When I first opened my practice I gave discounts to many different groups. Everyone from military personnel to senior citizens to fellow healthcare practitioners got lower rates when they had work done by my office.
But over time I’ve phased out discounts of any kind for any group, and I’ve done so for a number of reasons. Whatever you choose to do within your own practice is your choice but on today’s show I’ll talk about why I no longer offer discounts, and how to evaluate whether lowered fees for special groups is appropriate for your office.
Originally I gave discounts to fellow healthcare practitioners but I soon found this wasn’t a two-way street. When they came to me I gave them lowered rates than other people, but when my family used their services we paid the full price.
That’s one of the things to consider when you’re evaluating your discount policy: make sure the arrangements work in favor for both parties, and they aren’t one-sided.
Also as you’re reviewing your discount policy make sure it’s set and is clear to your staff so they can communicate with your patients clearly. Be certain everyone knows who gets what discount (if any) and what can or cannot be discounted. When you make the policy clear to everyone they don’t have to come running to you every time someone asks for a lower fee and there isn’t any confusion on how much of a discount is given and for whom.
If you’re going to be offering a cash discount make sure your staff and your patients understand what “cash” means: does it literally mean just cash? Or does it apply to any payment that doesn’t have to go through the insurance company first? Our office it meant cash and cash only – NOT credit cards, not checks, only cash.
But some clients didn’t understand that, they thought it applied to checks and credit or debit card payments too. At times there was confusion and misunderstandings ensued. Today to clear up the confusion we simply don’t offer the discount.
Which raises another consideration: if you choose to eliminate discounts like we did then I’d urge you to consider sending professional letters to the groups you used to give discounts to. That’s what we did when we removed reduced fees as a payment option. In the letter we also provided an effective date after which we’d no longer offer the discount, and we gave our reasons for doing so.
Whatever you end up doing with your practice is up to you; and this week’s for-action item is to look at your policy. Who are giving discounts to? Why are you doing so for that group? And if you don’t have a policy in place be sure to create one or be crystal clear with your staff that your discount policy is there are no discounts.
As you consider your options also be sure you know your business’ numbers, as I’ve said so many times before on the show you have to be profitable to be in business! When you know your numbers you’ll know if you can even afford to offer discounts.
Listen in for more details on how to transition from discounts to no discounts, and how to work with your staff to keep your policies effectively in place. All of that and more on this episode of Business of Dentistry!