Thursday, April 17, 2014

Why I Believe Passionately in the Need for Veterinary Payment Plans

The Idea Behind Low-Cost Veterinary Payment Plans
The birth of a business idea often comes about as a result of personal experience.  Perhaps you've struggled with something for which you wish you could find a solution.  For most of us, we probably have hundreds of ideas in a given day about how our lives could be easier, how tasks could be made more convenient, how money could be better spent.  Sometimes, there is one idea out of all those that persists and nags at you.  For me, that idea was how to make veterinary care more affordable for pet owners.

My $4,000 Vet Bill...
Over the past decade, I've had four dogs and four horses.  You can only imagine what I have spent on veterinary bills, and I don't regret a bit of it.  I don't have children, so for me, my dogs and horses fill that void.  Like many pet owners, I am willing to do almost anything to ensure that they have a good quality of life. However, paying for that quality of life has often been a challenge at best, and cause for sheer terror at worst.

Some years ago, I had an emergency vet bill that amounted to $4,000.  Seeing that bill was terrifying.  At the time, I was going through a difficult divorce and a job transition, and I didn't qualify for a third-party financing option.  Had I not had one credit card with a zero balance, I would not have been able to pay for my dog's treatment, which saved her life.  However, it took a very long time for me to pay that balance off, and at an outrageously high interest rate.

New Job Leads to An Opportunity to Solve a Problem
Several years after the "$4000 Vet Bill," I found myself with the opportunity to go to work for a payment processing company.  Our core business is the electronic processing of recurring payments, through automatic debits to a consumer's checking, savings, or credit card account.  We have a long history of efficiently and cost-effectively handling electronic transactions.  Nearly 27 years ago we started out by serving clients primarily in the health and fitness sector.  Recurring automatic debits are common when you join a gym, and most people are familiar with how that works.  My task when I started here was to figure out ways to expand our business to other markets beyond health and fitness, to help other businesses benefit from the electronic recurring revenue model.

While there are really countless businesses that we can help -- anyone with multiple recurring billing needs, or membership or subscription-driven businesses, there was one place I thought we could go where we could fill a void not just for the business, but for their clients as well, and that was the veterinary industry.  So I started to do some research.

Both Vets & Clients Struggle with Conversations About Cost
What I found was interesting and compelling.  Veterinarians often complained about the difficulty of discussing the cost of veterinary care with their clients.  Their clients, in turn, were anxious about that conversation, too, knowing that most veterinary clinics require payment in full at the time services are rendered.  While this is a fair expectation for the clinic -- after all, it is a business -- with the rising costs of vet care, payment in full is often difficult, if not impossible, for some clients.

3rd Party Financing Plans Not Always the Best Solution
Veterinarians have not ignored this issue by any means.  Most of them want to help their clients, and their clients' pets, any way they can.  It has become quite common for veterinary hospitals to offer third-party financing plans.  There are a number of 3rd party financing companies out there, but most vets use one in particular.  These financing plans are a great option for many clients, provided they are approved for the line of credit, and that they completely understand the terms of repayment.  The veterinarian benefits, too, because he or she gets paid in full -- albeit with a 5 to 10% fee taken off the top.  While that is quite a hefty percentage, until recently there has been no other viable alternative for vets who wish to offer their clients payment terms.  And that is where my idea came in.  I began wondering if we could set up recurring payment plans that veterinarians could offer to clients with a legitimate need for payment terms, but for whom financing wasn't an option, for whatever reason.

Of course, the perspective I had on this was primarily based on my viewpoint as a consumer of veterinary services.  It would make my life easier and give me some peace of mind knowing that I had a payment plan option that was not interest-based, and that I could pay off in equal installments over a period of a few months.  That's all well and good for me.  But there needed to be a benefit to the veterinarian as well.

The Gap Between Financed Payments and Non-Payment
From the research I've done, as well as the anecdotal evidence I've gathered by talking to vets in my area, I discovered that many of them have no alternative to offer to clients who have a large bill, and who do not qualify for financing, or do not wish to open another line of credit.  In the absence of the third-party financing option, many of these vets have set up promissory notes with clients, held credit card information and billed the card each month (which is a data security risk to the vet practice), or even held onto post-dated checks.  Other attempts to reconcile clients' payment problems include everything from having the client clean cages in the back of the hospital to finally having to offer a deep discount on services, just to get paid something. (One vet I talked to even held the title to a client's truck!)  It seemed to me that I could come up with a better, more systematic way to help these veterinarians get paid without resorting to all of these largely unsuccessful tactics.

Many months of research, both formal and informal, have resulted in the professional payment plan management package we are launching for veterinary practices.  Our program aims to create a "win-win" situation for vets and their clients, which makes me feel very good.  If I can't offer a legitimate service that will truly solve a problem, then I am not doing my job!

A Simple Solution for Filling a Void in Veterinary Payment Options
Our program really offers a simple, streamlined solution, and I'm proud of that.  What we do is make it possible for veterinary clinics to offer clients a recurring payment plan, with the payments automatically drafted from a checking, savings, or credit card account.  We offer multiple debit dates, to make it easy for the clients to budget the payments.  We also want the vet clinics to have the freedom to set up the payment plans on their terms, not a set of terms we dictate to them.  The clinic can decide the amount of time they want to offer the client to pay off their bill.  They can make this decision on a case by case basis, in which the client's need can be balanced with the clinic's need to get that revenue in the bank. 

We also wanted to make it easy for the vet practice to offer these payment plans without creating extra work for their own staff, by having to track payments and follow up in the event of a returned or declined transaction.  Our company will handle all of that on the clinic's behalf, so we can act as an extension of their "client relations department."

No Cost to the Vet Practice
Finally, we intended to offer these payment plans at no cost to the veterinary practice.  The client pays an enrollment fee, and a nominal convenience fee is added to each periodic payment, so the administrative cost is absorbed by the client instead of the vet.  The only costs for the vet are a one-time set-up fee (less than $200) for our optional Credit Score Recommendation (CSR) system, and if the vet decides to use this system, there is a fee for each credit check.

Assessing Client Credit Risk
The way the CSR system works is simple:  After accessing the system, the client's basic information is entered (name, address, SSN), submitted with the click of a button, and an instant credit decision is returned, featuring a credit letter grade (A - G), along with a recommendation for the amount of down payment to collect, and the length of payment period to offer.  We designed these results as recommendations, based on our research into typical delinquency rates for each credit grade.  The veterinary practice may choose to follow our recommendations, or not.  They are meant to be a guideline, not a fixed requirement in order to offer a payment plan.  The practice is in control of determining client eligibility for a payment plan, informed by our CSR program.

Since we are not a lending company, we do not provide payment in full upfront to the clinic.  Our system does minimize the vet's financial risk, by combining credit assessments with systematic, automatic withdrawals from the client's account.  We believe this is a beneficial option to the vet as well as the client, especially since the absence of a no-interest payment alternative can result in non-payment.

Most Clients Want to Pay and Most Vets Want to Offer Superior Care
It is truly my belief that most clients want to be able to pay their vet bill, and they will pay it, if they have a manageable way to do so.  I also believe that veterinarians are pretty awesome people in general, and that they don't want their clients to be stressed about how to pay, when they are already worried for their pet's health.  Vets want to provide the best care for the animal; clients want the best care for their beloved family member.  I passionately believe that everyone can get what they want when the financial strain is reduced for both parties.

To learn more about our payment plan management package for veterinary practices, contact me (Suzanne Cannon) between 10 am and 6 pm EST at 1-800-766-1918, ext. 106.  Alternatively you can click on our logo below.

I would welcome your comments or thoughts on this post!  Feel free to comment here, or you can e-mail me directly at  Thanks!!

Thursday, April 3, 2014

Trade Journals: Helping or Hurting Readers?

Do trade journals help or hurt the health & fitness industry?

Being in the health and fitness industry for the past 27 years, I have seen a dramatic change in how the industry's trade journals have changed. Not only the reduction in the number of trade journals and/or the move to digital instead of print, but the quality of the articles.

How many trade journal articles are written by actual journalists? How many are written by people with real knowledge about the industry? How many are written by the advertisers? How many are stolen/re-posted from other news/blog sources? Have you ever tried to publish an article in one of the trade journals without having to advertise with them? How many times have you seen false information in an article? Even worse, would you even know if what you are reading is false?

Case in point, I know of a trade journal that re-posted a very inaccurate article on a health club owner, claiming that the Attorney General of that state alleged that the owner was defrauding his members. In reality, the owner was providing a much better service at a lower cost, and 99% of the members were very happy. It was later discovered that this erroneous story was nothing more than a witch hunt.  The health club owner spent tens of thousands of dollars in legal fees, to prove that he did nothing wrong and actually followed the law as it is written. The publisher of the inaccurate article could have instead investigated this case as an abuse of power by a government agency -- something that would have actually informed others in the industry, and helped them better manage and protect their businesses.

However, when this was brought to the publisher's attention, they refused to take the time to investigate, and then wrote a supposed "retraction” in their next issue. They explained that they only reprinted from another source. So instead of investigating, one false story led to another.

Here's a more personal case: I recently sent an article to two individuals at Club Industry, asking if they would be interested in publishing what I'd written, which was about health club membership pricing and annual fees. (We do not advertise in Club Industry.) Months went by with no response from either person. Then in the February 2014 edition, an article appeared with almost the exact same information. When I confronted the author of the article the response was, “My apologies, I honestly did not read your email.. but in doing a search I see your email now… I did not look at your article…” This is very hard to believe, since the article was almost a word-for-word copy of my original article. Apart from this matter, I also wonder what it says about a publication, when two staff members do not even bother to read their emails.

You tell me: here is my article I sent to Pam Kufahl and Stuart Goldman of Club Industry on November 4, 2013, and here is the Club Industry article published February 2014.

It could very well be an honest mistake on Club Industry’s part, and Club Industry does do a better job than all the other industry trade journals. However, in this day of non-investigative reporting, having advertisers write content, and re-posting articles written by others, I am left to wonder what is really going on with the trade publication industry. Are they actually helping the industry they serve? What happened to real investigative reporting that helps the industry?

Let me know your thoughts.

Payment Plans for Pearly Whites: Dental Patient Financing Options

Dental Care Crisis?
It’s no surprise that America is in a dental care crisis. According to a study done by ‘Statistics Brain’ in July 2013, nearly 50% of Americans do not see their dentist on an annual basis. At an even more alarming rate, the average time in between dentist visits has increased from one year to 3-4 years.  Why is this? Many studies have shown it is due to substantial increase in pricing and the lack of coverage by most dental insurance plans.  Many people think “Because I need this dental work, my dental insurance will pay for it!” or “My dental insurance will pay 80 percent of what I need to fix my dental problems!” When the reality is people who have “dental insurance” really only have minor dental benefits that are determined by their employer and an insurance company. A dental benefit is more like a coupon. It doesn’t pay for the entire product or service. It only pays a limited percentage, and it has a maximum it will pay each year.

Dental Costs Up, Insurance Coverage Down
According to, in 1972, most dental plans covered $1,000 to $1,500 per year, and most companies paid the premiums. At that time, crown fees were around $400 and insurance could, would and did pay for 80 percent. Basically, a patient could get three or four crowns a year to repair broken down, filled teeth and in a few years, their mouth didn’t need any more major work. Plus, the patient could get two cleanings a year and not even approach their insurance limits. That was a great deal for patients and dentists. Forty years later, most plans still have $1,000 to $1,500 annual limits, and many people are paying half or all of the premiums. Today’s crown prices have more than doubled so one or two crowns will basically wipe out a year’s benefit, at least. 

Consumers also believe that ‘the dentist and dental team should know what a person’s dental benefit is and what it will cover and pay, and if the insurance company doesn’t pay, it’s their problem.’ When in reality, the dental insurance contract is between the employer and employee (the patient), and the insurance company. The dentist has no influence on what “should be covered”. The employer and insurance company negotiate these things ahead of time. The dentist is caught in the middle, and the patient is left to figure out how to pay for treatment that isn’t covered.

Patient Financing with Credit Plans
In response to these circumstances, more dental practices have begun offering patient financing.  In many cases the financing is through a third party, and the benefit to the patient is obvious: they can spread their payments out over time, which eases the financial strain when it comes to costly procedures.  Some practices accept “medical credit cards,” and the patient must be approved for a credit line.  If approved – and according to some statistics, as few as 1/3 of applicants for these types of credit plans are – the patient typically has 6 to 12 months to pay off their balance in full.  The monthly payments are usually reasonable, but there is the potential for complications.  If the patient misses a single payment, or if they are unable to pay their balance in full by the end of the payment term, they may incur interest charges exceeding 25%, applied retroactively on their entire balance. 

These types of third party financing plans benefit the dentist by paying the treatment fee upfront – but the dentist has to sacrifice as much as 10% of that in order to offer the payment plan. 

Interest-Free Installment Payments
Recently, an alternative form of patient financing has become available, through third party billing companies – such as EBCS – that will electronically draft payments from the patient’s checking, savings or credit card account.  The payments are typically debited on a monthly basis, and the plans are interest-free.  In the event that a payment returns or declines, the billing company handles the contact with the patient, instead of the dentist’s office.

For the patient, breaking up the total cost of treatment into installment payments not only increases affordability, it also translates into a greater willingness to seek follow-up or elective procedures. 
For the dentist, these types of plans are available at low cost, or in some cases, no cost to the practice.  Administrative fees are passed on to the patient in the form of a modest enrollment fee, along with a few extra dollars charged for each automatic withdrawal.  Most patients are more than willing to pay these fees, which add up to a negligible percentage of their total treatment cost.   They consider it a small price to pay – literally – for the ease and convenience of a payment plan.

To minimize concerns about risk of delinquency, the dentist can also purchase a credit recommendation system that delivers instant decisioning via a soft credit pull, as well as guidelines for determining the amount of down payment and length of payment term.

As out-of-pocket dental costs rise, due to the increase in treatment fees and reduced dental coverage, it is well worth it for dental practices to consider offering patients as many flexible payment options as possible.  Patients will appreciate having choices, and dentists will realize the benefit of increased case acceptance, coupled with a reduction in delinquencies and accounts receivable.

For more information about setting up an in-house payment plan for your dental practice through EBCS, contact us:  Electronic Billing & Customer Support, 800-766-1918, Monday through Friday, 9:00 am –
6:00 pm Eastern.

Tuesday, April 1, 2014

RIP, Microsoft XP: Don't Mourn, Just Migrate

XP support end of life, April 8th.

All good things come to an end, unfortunately. Microsoft’s XP operating system, with approximately 400 million systems still in use, will no longer be supported starting April 8, 2014.

Considering how much this has been in the news this should not be a surprise to most companies. However, for those that haven't yet made the transition may be in for a rude awakening. For companies that have not migrated to Windows 7 or 8 this transition will be expensive and complex. Because of this you can expect to see XP in use for years to come.

However, companies that do not update will be doing so at their own risk, both from a security and compliance standpoint.

1.   What does this end of life really mean?
Microsoft will no longer issue security updates for XP. 

2.   Why is this such a big deal?

Knowing how the bad guys operate, they are always looking for the path of least resistance when they launch attacks. It is believed that hackers have hoarded a number of exploits that they will launch once the XP patches stop. Also, due to how Microsoft uses shared coding between XP and newer versions of Windows, attackers will reverse engineer patches that Microsoft releases for newer Windows versions to create exploits that also work on XP.

3.   If I only have one or two XP systems in my network, am I at risk?

Yes, especially if they are connected to a network that has access to the internet. One bad apple can ruin the basket. A hacker is just looking for a way into your network and that one XP system will be their key in.

When you upgrade you must consider the following:

1.   Will my current software run on Windows 8?

2.   What will be the cost & time to upgrade your software to run on the newer platform?

3.   What will the cost be to train your staff?

4.   Will there be any downtime, loss of production?

These are expenses that many business people cannot afford immediately, but you must budget to upgrade your computer systems. The risk is too great to have your sensitive data stolen. And as we saw with the Target breach, your business may not store sensitive data, but if you communicate with another company that does, you may be at risk of a legal nightmare if a hack originates from your system.

Consider the following costs associated with a data breach:

1.   A forensic examination could cost from $150 to $275 per record stolen, or having an outside firm handle the forensics will cost you from $200 to $2,000 per hour.

2.   To notify your customers could cost from $.50 to $5.00 per customer.

3.   How will you handle the increase in customer service calls you will receive? Consider the extra labor hours and/or the cost to use a third-party call center.

4.   The cost to provide credit monitoring could be as high as $30 per customer.

5.   The cost of public relations could be as high as $214 per customer according to a 2010 Ponemon Study.

6.   The average legal defense cost could be $500,000 and the average settlement is $1 million.

7.   Consider the potential costs of regulatory proceedings, fines and penalties.

8.   After a breach, a company may be required to implement a Comprehensive Written Information Security Program.

View the entire article on Data Breach Costs here.

You be the judge. I think it is well worth it to migrate to Windows 8 no matter how much you love --  --  or depend on XP.