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Help your patients avoid “sticker-shock” for high-cost treatment cases.
Today, Reese welcomes Dave Roehr to the Dentist Money™ podcast. Dave is CEO of Proceed Finance, a company that specializes in affordable financing for patients thinking about cosmetics or other large treatment cases. Many patients want, or even need, high-cost procedures. With only an estimated 15% of people in the U.S. able to afford to pay in cash, Dave and Reese take a close look at what you can do to reach the other 85%.
Find out how to make high-cost procedures fit into your patients’ budgets.
Reese Harper: Welcome to the Dentist Money Show. I’m your host, Reese Harper and today, I’m going to introduce you to a special interview I did with Dave Roehr. Dave’s the CEO of Proceed Finance. It’s a company that he started after having helped Carbela’s grow into one of the country’s largest outdoor sports retailers.
Reese Harper: I thought that Dave had a really interesting perspective on patient financing. He had a really good experience at Carbela’s being able to develop their consumer financing product and, I think that the advice he’ll offer you to today puts you in a position to succeed when it comes to financing a lot of your patients in any kind of treatment that they need.
Reese Harper: Thanks again for tuning into the interview, I hope you enjoy the show.
Reese Harper: Make sure and visit us at Dentist Advisors.com and check out our education library. You’ll find a lot of videos, podcasts and new articles that we’re releasing every week. Also, when you go to the website don’t forget to book a free consultation clicking the book free consultation button where you’ll be paired with one of our dental specific financial advisors on a day that works for you.
Reese Harper: We book appointments on off days, lunches, even on some Saturdays. Just check out the calendar and find a time that’s convenient. Call us anytime at 833-DDS-PLAN. You can also text us at the same number. Don’t forget to submit your financial questions on our free Facebook group at, DentistAdvisors.com/group. We take the questions from the Facebook group and use them in the podcast.
Reese Harper: Thanks again for listening and enjoy the show.
Announcer: Consult an advisor or conduct your own due diligence when making financial decisions. General principles discussed during this program do not constitute personal advice. This program is furnished by Dentist Advisors, a registered investment advisor. This is Dentist Money. Now, here’s your host, Reese Harper.
Reese Harper: Welcome to the Dentist Money Show where we help dentists make smart, financial decisions. I’m your host, Reese Harper here with a special guest today that has a unique background that I think will be particularly helpful to our audience. I’d like to welcome Dave Roehr to the Show. Dave, welcome to the Dentist Money Show.
Dave Roehr: Hey, thanks for having me on today. I really appreciate that and, look forward to talking to your listeners and, hopefully at the end of this I’ll help some of their financial perspective and grow their practice and, at the end of the day, make more money and create success.
Reese Harper: Yeah Man. I think you’ve got a really cool background that when I saw your career history, I thought, “Man, that would be a really interesting guest”. Partially because I have an interest at Carbela’s. One of their big flagship stores is actually just up the road from my house a few miles and, I take my kids there to look at the fish in the fish tank every few weekends.
Dave Roehr: Well thank you.
Reese Harper: It’s like a free zoo. I’m sure there was some logic in that.
Dave Roehr: There was. I can explain that real simply but, well thanks for being a Carbela’s customer.
Reese Harper: Yes, for people who don’t know, Carbela’s is a really big outdoor retailer, gear brand product vendor. It’s a huge brand. They distribute and have some of their own products but they distribute other products as well. It’s a fishing, hiking, anything outdoors, hunting-
Dave Roehr: Camping, you name it.
Reese Harper: Camping, you name it. So Dave’s background actually is in the finance industry but before getting into dental with his current business, Proceed Finance, he actually had some really interesting experience around credit and extending credit, creating credit programs at Carbela’s. And so, I want to get your background a little bit Dave and maybe share it briefly and then, we’ll jump into the applicability to your current venture.
Dave Roehr: Sure. Well thanks. Yes, I’d describe it, I’ve had three careers. My first career was, I’m a CPA. I have a Master’s degree in tax law and spent about 14 years in public accounting and I was a partner at Grant Thornton. So, in that whole thing, I learned a lot about banking. My industry specialization was financial institutions so, having said that I moved into my second career which basically, where I was hired away by my largest client, Carbela’s.
Dave Roehr: I started as their CFO and I had a great run with them. It was in ’94 when I joined them. We grew the company significantly but what I probably did that I guess I was most proud of, other than having a lot of fun growing and opening retail stores all over the country-
Reese Harper: Yes. That’s kind of being a blast doing big, old open-[crosstalk 00:04:45]
Dave Roehr: Yes. Then you have the legacy stores, they were destination stores that … it was really retail-tainment we call it. My whole thing with Carbela’s too is I started their credit card bank. That’s how I got into this unsecured credit world. When it was a de novo, we didn’t have any card holders and that really took off nicely with the Carbela’s credit card.
Dave Roehr: We ended up chartering our own bank so, we owned our own bank and grew that as kind of a customer loyalty product where you’d use points and use those for Carbela products and all of that and, it worked really well. But when I left there we had about two and a half million card holders. So, we grew it from nothing to two and a half million card holders and had well over six billion dollars in receivables from our card holders.
Dave Roehr: But, it was a very successful program.
Reese Harper: Huge product. Yes, huge product. So, let’s get into how this comes across to the dental market.
Dave Roehr: Okay.
Reese Harper: It’s really cool to hear your background. I think people appreciate knowing where your perspective’s coming form. At this point, how did you make the pivot from Carbela’s to Proceed Finance?
Dave Roehr: Sure. After the credit crisis, I retired from Carbela’s and I was bored to death and, couldn’t stand retirement and was not happy so, I wanted to do something different. And what I learned just from using credit cards as a way to finance people, I looked at it and got very interested in the dental and medical industries as far as what products out there can finance things that people need and want.
Dave Roehr: You can start with elective type procedures, uninsured type procedures but what type of products exist in that market that … because it’s getting so big and the insurance companies are paying for less and less and, I think there’s a huge need. So, that’s really what got my interest. And, I did a consulting project in the space and really got me interested in it.
Reese Harper: So what are the results of the consulting project show you?
Dave Roehr: That after the credit crisis there was really not a lot of good alternatives for providers in particular to get patients into payment plans for expensive procedures.
Reese Harper: So you saw that in which industries were the biggest kind of … was it the medical side and elective procedures, plastic surgeons? Was it dentistry and cosmetics? Were you able to kind of see which markets were the biggest?
Dave Roehr: Sure, and did a bunch of studies for that. My consulting project was actually in dentistry so, I learned a lot about cosmetic dentistry and in particular dental implants and, just the whole progression of the science behind it and how … the solutions that people now can offer for people that need dental implants. And there’s a huge market of … I think the statistic I remember hearing is, there’s currently thirty million people that are in dentures in this country and with Baby Boomers getting older and older there’s just a lot of demand and need for that and I understood that, “Hey, this is a huge area”.
Dave Roehr: So, what I learned is, it’s all uninsured in general. So, dental insurance is really not paying for anything over a certain amount of money when you got your dental insurance plans but, when you get into the larger cases which people need and want is, there’s a percent of the market that can pay cash and there’s a huge percentage of the market that want to pay the dentist for this treatment but, they can’t afford to pay it now.
Dave Roehr: They need help, they need some kind of a quality payment plan to be able to access the treatment plans that people are presenting to them. So, that’s what got me interested and I looked at the landscape and there really wasn’t a lot of good product out there that did this. And the product that was out there was not patient friendly, sometimes not provider friendly and it wasn’t really defined for the market. So, that’s what got my interest and that’s what I founded Proceed Finance to address that issue.
Reese Harper: So, when you say it wasn’t patient friendly, it wasn’t provider friendly, what did you start to notice-
Dave Roehr: What’s happening especially in large cases in dentistry … We’ll just kind of stay there with dental implants for example. The full mouth arch you know, where you go upper lower, you know, those cases can run sixty thousand dollars for a full mouth restoration and those cases start at maybe ten and anywhere in between. So, what products out there? Well, what I was finding is affordability just wasn’t there. You have to make these procedures affordable for patients where they feel comfortable, that they can afford this if you’re going to get them converted to actually say yes and access your treatment plan it has to be affordable.
Dave Roehr: And, the product out there wasn’t affordable. What you’d see, I will call it, with a lot of the products, especially with the higher end cases and the larger amounts is, you get things that looked like house payments and not car payments. I mean it’s as simple as that. When you present a patient with another house payment, they’re going to say, “We can’t afford that, I’m not interested. I don’t want to do that. That won’t work for me”.
Dave Roehr: When you can get it reduced to something that looks like a car payment, you know they can usually find a way to put that in their budget. And there’s been studies on all of this but, the psychological impact of presenting somebody with a reasonable payment plan that is another car payment that they can fit into their budget, they’ll figure that out and they’ll feel comfortable.
Dave Roehr: So, you have to have product that does that and there really wasn’t anything out there that was even coming close to it. So, how do you do it? It’s really a matter of okay, the patient interest rates have to be low or affordable, this is unsecured financing so, you have to really create a interest rate that’s probably below market and you have to extend the term.
Dave Roehr: So, you have to go longer and that’s what Proceed Finance does. So we combined low interest rates with an eight year payment plan. On a twenty thousand dollar financing product we can get that payment as low as three hundred bucks a month. So, when you have that, people will say, “I can afford that. I need and want what you have because I want to change my life”. Especially with people in implant cases where it’s a life changing event that they want affordability and they want to do it but it has to work for them. So, you have to create product.
Dave Roehr: And what I’ve learned also is that you have practices that want to do large cases. Well if they’re relying just strictly on the percent of the market that can pay cash, those are people that have the money in their checking account or savings account or your marketable securities or, have access on their credit cards where they have large credit limits and that sort of thing and can pay cash, that might represent about fifteen percent of the country that have that sort of liquidity. But the rest of the country, there’s some really sad statistics out there that show that seventy percent of the people in this country live pay check to pay check. It’s sixty five percent of the people in this country do not have five hundred dollars in liquidity or in their savings account for an unexpected expense.
Dave Roehr: So, if you’re going to reach that market, which it’s the largest segment of the market, is you have to create affordability and you have to have a payment plan that everybody’s comfortable with. So, that’s what we try to do.
Reese Harper: So, let’s just say we’re trying to do a general survey of the options available and then we’ll talk about how to implement this in your practice in a second. But, I’m cash only, I’ve got some financing option, I’ve got the ability to self finance it and my question I guess is, if you look at all the options, if I’m a dentist and I’ve got all these options to pick from out there, how do I narrow down providers? Should I have multiple options for my patients to pick from or, should I have one go-to like Proceed that I stick with and understand better?
Reese Harper: Help me understand the marketplace itself and how I would narrow that down and maybe why I would choose to bring in a financing partner as opposed to other options?
Dave Roehr: Sure, great question. Here’s patient financing landscape and, I usually recommend that providers have more than one option because they’re going to need it. There’s different lenders that do different things for patients. Overall general that I’ll call it, there’s funded models and unfunded models out there. Unfunded models are hey, the dentist or the doctor finances the receivables themselves. So, when somebody you know has a thirty thousand dollar treatment plan and they need a payment plan, the doctor does have the option to sell or finance that or take on that debt and do it themselves.
Dave Roehr: I highly recommend they don’t because they’re not good at it and they don’t understand how to write this stuff. And, in most cases the doctor doesn’t want to do that anyway because they can’t afford to. They need their need cash flow, they need their money out of the procedure now because they have bills to pay and they just can’t afford to sell or finance a large amount of patients just because it doesn’t work for them.
Dave Roehr: But, they can do that themselves. And there are models out there that will manage all of this for doctors and dentists. You know Compassionate Finance is one of them and, they have a model where the doctor takes the risk, it’s their money but they’ll help underwrite it and they’ll manage the receivables for the doctor and then, it’s a pay as you go model. The doctor gets paid when the patient pays and then they get some kind of a fee for doing that.
Reese Harper: And typically, in my experience even with very large companies and other industries we’ll call that and that you’re saying, it’s an unfunded model is what you called it right?
Dave Roehr: Yes.
Reese Harper: And even in other industries you’ll see very large companies, they don’t want to … it doesn’t really become sustainable for a small business to operate that way because you’re constantly building up a larger AR balance especially if you’re a dentist that doesn’t have … if you’re going to make cosmetics be a large part of your practice and have a large volume of cases that you’re going to try to market for, it becomes less and less sustainable.
Dave Roehr: They can’t afford to do it. That’s exactly right. So they, most dentists I don’t really think it’s a good idea for a lot of dentists to get into the financing business just because one, it’s not what they’re good at, that’s not why they went to school. They-
Reese Harper: They have a little bit of a conflict too don’t they? I mean because you love that patient-
Dave Roehr: And now you’ve got to collect money from them and when they don’t pay on time … The managing all of that is just kind of not a good idea just because of the cost of it. Even if you wanted to do it that way, you’re going to have to add people that just do nothing but manage accounts receivable.
Reese Harper: Makes sense.
Dave Roehr: So that’s unfunded. But that does play a role and it’s out there and I’ll tie it together here in a second. But the funded model is where the dentist will get paid up front for the procedure and most of the models are non recourse so the finance company will take all the risk with the patient so, the patient doesn’t pay … that doesn’t, the doctor’s out of the business of risk. And then all of that’s managed by a third party. So, the servicing of the accounts and all of that. It distances the dentist from the lender.
Dave Roehr: Now, I will caution. You’ve got to be a little careful on selection of a lender because you don’t want a lender to abuse patients where they’re aggressive, they’re predatory, they have a lot of hidden fees. Because what happens then is the patient will feel like the doctor put them into this finance program that all of a sudden is not a great program for the patient.
Dave Roehr: And what happens then and I hear it from doctors all the time is, they’ll never see those patients again and they get no referrals. Because you are associated with that transaction even though it was a third party. So you want a good reputation with somebody that takes care of your patients and treats them with dignity and makes it a pleasant experience for the patient and, the financing product was quality. So, that’s important. That’s the funded model and-
Reese Harper: Let’s talk about selecting the … Go ahead if you wanted to finish your thought there I’ll let you. But I want to talk about comparing the landscape a little bit which I’m assuming you’re-
Dave Roehr: Sure. The funding model is when, I’ll tell you. There’s not a lot of us out there to be honest with you. If there’s care credit which is a credit card now that’s a model that’s … I want to spend a little bit of time on that. That is like a credit card. So, that particular lender will give the patient a credit card and a line of credit that’s usable, that you know their whole network of providers, they’re the largest in the country. But remember, it’s a credit card with a credit line and, the credit limit’s usually are not very high but, they do finance a lot of medical procedures.
Dave Roehr: And I recommend that providers have something like that for the small cases. Because they’re set up to … a crown and bridge. You know, a thousand dollar procedure that works really well okay? So, for the normal traditional dentistry where people need help with financing, that sort of a product works really well.
Dave Roehr: But when you get into cosmetic dentistry and large cases, that’s kind of where they end because that’s not their business and they don’t give a lot of line of credit. And if they do, they want to be paid off shortly so, their affordability problem comes into play. So you need a term lender for large cases. And that’s what we do at Proceed Finance. So, we make term loans and try to create that lowest possible payment for affordability so the patient will say yes to a treatment plan and then, back that up with a quality product.
Dave Roehr: So, that’s the term lender for large cases. So when I see a practice and I get this question all the time is, have one lender for the small cases, usually that’s a care credit type model. And then the other lender that specializes in large cases and term loans, which is what we do and then if you want to, for example, roll the dice on some receivables and finance them yourselves, there’s a model to do that as well. And some doctors like that because for example, not everybody’s going to be approved for our product-
Reese Harper: Yes. You’re a high quality product.
Dave Roehr: Yes, we underwrite very aggressively but we don’t approve everybody. I mean there’s a certain segmentation of the country that’s just not credit worthy for this type of product-
Reese Harper: Where do you guys go to in your general underwriting guidelines?
Dave Roehr: Credit scores in general they range from 300 to 850 okay? And Prime is probably any credit score over 700, Super Prime is anything over 750 and exceptional credit is over 800. But when you start dipping below 650, 600, then you’re getting into a Sub-prime and that’s where the credit worthiness issues come up where people have already proven to the world because of their credit score that they’ve got problems paying their bills and those sort of things and, they’re high risk.
Dave Roehr: So, our average loan for example, is just north of twenty five thousand dollars. That’s our average. And our average credit approval when we have a credit apply with us, is about forty-four thousand. So we play in that range from a twenty five hundred dollar loan as our minimum up to sixty thousand unsecured-
Reese Harper: Okay.
Dave Roehr: We specialize in large cases and in dentistry in particular because all of that market is uninsured, you need a great solution for those cases if you want your conversion rate of people that come into your office to access your treatment plans and if you want to do the high end, large case work.
Reese Harper: What do rates range from depending on credit and DTI debt to income scores?
Dave Roehr: Sure. What we do is-
Reese Harper: And terms and how the terms range?
Dave Roehr: Absolutely. We range from a 24 month loan is our shortest up to all the way up to 96 months which is, eight years. And so, they’ll get an increment of 12 months in between so they get to pick and choose. But when you go with an eight year loan for example, and our rates for a patient start at three ninety-nine which is below Prime and, our highest risk category goes to 17.99. So, we will not go any higher than a 17.99% loan and it’s anywhere in between based on their credit profile and how long-
Reese Harper: Term.
Dave Roehr: And the term.
Reese Harper: So, if they’ve got the highest possible score, the credit score, and they want the shortest possible term, we might be close to that 4% or-
Dave Roehr: Yes, they’ll get a 3.99 loan. And our highest risk category would be someone that’s right at our cut off for credit and wants the money for the longest term that we offer and they would pay the highest risk. You have to understand this is unsecured credit. This is below market. If you price this credit in the market we are below and when you combine that with a long term, that’s what creates the affordability for a patient.
Reese Harper: Yes, that’s pretty critical. I mean because a lot of people when you’re doing any kind of financial decision making or financial planning, having a long term can be the reason that you either are able to do something or not. And it doesn’t mean that they’ll carry it the whole term.
Dave Roehr: You want a product too like with a … that okay, you want to make sure your patients are treated fairly, honestly and with dignity. So, our product, we don’t have any free payment penalty so if a patient takes out a loan and wants to prepay it early or refinance it with a secured loan that’s a lower cost, we don’t care. We try to give them complete flexibility. So you want that. As far as the no hidden fees, our stated rates on our loans are the same as the APR’s and so, it’s a real honest, fair product.
Reese Harper: What about an origination or a set up cost of some kind? Is that normal to see that, to get a little bit of buy in from a patient as a lender or, do you guys not have that?
Dave Roehr: We don’t have that either. No, it’s a straight loan. Like I said, there’s no origination cost, there’s no fees, it’s just a term loan that looks like a term loan with no cost. The only fee we have in the whole thing is a late payment fee because I don’t really want to collect because it’s more of a punitive thing. But it’s a low fee. It’s ten bucks or 5% of the-
Reese Harper: It costs more to collect that fee than it does to charge it, yes.
Dave Roehr: You’ve got that one right.
Reese Harper: But you have to have that to encourage people to buy it.
Dave Roehr: You want it there as an incentive to make payments on time. But that’s us a lender we take that risk and are good at servicing our loans. But-
Reese Harper: That’s awesome. Tell me a little bit about the market real quick in terms of how many options are there for dentists to pick from that have long terms and competitive rates? Because I do think for the most part, the majority of the options that I see that address the market are either card based or, they’re smaller quantities, not as long of a term and I’d call that … a lot of people are interested in getting into this industry. A lot of my friends are interested in getting into this industry because they can charge a lot of money to people that are in a tough situation right.
Reese Harper: Where this product is very different than that and you’re trying to create a quality product for credit worthy customers to take on a, usually do a large case right and have some pro active elective care? Give me a sense for the competition in that market and the size of the market and, how you guys have grown and where you’re at in that space.
Dave Roehr: Absolutely. The market is very large especially in implantology. Now I’ve heard different numbers and I imagine they move around and, it depends on what is counted. But the implant market alone is 4 billion annually.
Reese Harper: Yes annually. For people who don’t know that, that means 4 billion dollars per year of implant services that are being transacted in the United States.
Dave Roehr: Yes. And growing. And just the market that’s there, you have thirty million people and, you have five million people I understand a year that are Baby Boomers that are going to have the problem that we’ll need to address implants or dentures or missing teeth at some point in their lives. So, the market is huge. So, implants are just today a small fraction of the total market. But it’s the obviously best solution for people with missing or losing their teeth or, those types of dental problems.
Dave Roehr: And a lot of it’s caused by not because people didn’t take care of their teeth, it’s caused by genetics and they’re just in a gene pool where if they live long enough, they’re going to lose their teeth. So that’s a huge market. So when you’re talking about 4 billion, that’s today and we’re not reaching everybody. And a lot of it is affordability. I mean, how many people can afford a thirty or forty thousand dollar treatment plan and want to say yes to that and, will look for other alternatives?
Dave Roehr: But with the investment they’re going to make in themselves in their life changing event that happens is … they want to do it. So, you get it to that point. Now it’s just a matter of how do you get it financed and make it affordable? So that’s what our product tries to do. That’s kind of our core value. We want to make it a good experience for people so they say yes.
Dave Roehr: I’ll talk about the dentists that want to do implants or large cases. They’ll spend a lot of money on marketing and trying to get people in the door and let the market know that they do implants-
Reese Harper: They do that service.
Dave Roehr: And if they don’t have a quality product to help people afford this, people are not going to do businesses with them. They’re going to try to go somewhere else or they just haven’t worked … where the treatment plan is accepted by the patient. So that’s what I see. I’ll divide up America up like this. Probably out of a hundred people, and this is just averages, twenty five out of a hundred aren’t credit worthy for our product or any type of a quality term loan for affordability.
Dave Roehr: Those are people that have to repair their credit and all that. But seventy five percent of the people are and of that seventy five percent maybe the top fifth of that can pay cash, they have alternatives. But the rest of them don’t have the cash to pay for your treatment plan up front and need a financing product. They describe it as, easy as, they want to pay you, they just can’t pay you now.
Dave Roehr: So, help them out and put them in a plan and if you’re good at this and that’s another rule for dentistry that you need treatment coordinators that understand this, that are trained, that know how to help people and work it out when they’re on a payment plan. Don’t let them leave with say, “I can’t afford this. The sticker price is too much. I just can’t do this”. There is a way to get it done if they’re credit worthy. And the treatment coordinators need to be trained on how to do that.
Dave Roehr: And if they’re good at it, which is what I recommend practices make an investment in a great treatment coordinator that is well trained. Because the conversion rate when you spend the money on marketing, you get them into your practice and how do you get them in the chair where you’re actually doing the work and, say yes to these large cases is it’s the conversion rate. And if your practice is good at that, your conversion rate, you move that needle based on the ones that come in and, you start converting fifty percent of the people that come in, seventy five percent …
Dave Roehr: I mean, you can imagine the financial impact that does to a practice.
Reese Harper: Yes, I feel like that’s an area in a lot of services. I mean you probably saw this in tax, selling tax services. You probably have seen it in dentistry now. I’ve seen it in a lot of other industries. The way you present information to people has a huge impact on whether they’ll move forward or make a decision. And I don’t think we spend enough time on that in dentistry especially when it comes to making the right type of care. Some of these larger elective procedures are the right type of care for a lot of people.
Reese Harper: It’s the best long term investment that they could make and it’s actually in their best interest. But depending on how you present the information, they’ll either be likely to adopt it or walk away. And I just think, Man it really is a skill, the treatment coordinator or a skilled dentist, it takes a skilled team to be able to present information in a way that gives people choices.
Reese Harper: People, they want choices. They don’t want to be pigeon holed into one option.
Dave Roehr: Absolutely.
Reese Harper: People want choices and they want to feel they can pull the lever. And Man, I just think that this can’t be overstated how important it is to get this down in your practice. So, let’s talk a little about that faux pas and the mistakes that you see dentists making when it comes to case presentation, comes to financing presentation. Are there any tips or guidance you could say that really these are things that are really important to do that we’ve seen work?
Reese Harper: Imagine you’ve had to put on some CE around this and coach some people on this quite a bit.
Dave Roehr: Absolutely. One of the things we do is part of our onboarding, we don’t charge for putting a new practice in our systems because I only want to make money when the dentist makes money. That’s when they actually get a treatment plan accepted and a loan is taken out. But prior to that to answer the question is, we have two types of training where one … for technology training which everybody has to go through. But, we have what I have a level two training which is consulting on how to convert cases.
Dave Roehr: So that’s kind of a sum of all of our best practices we see out in the market place. So practices that are very successful at doing this, very financially successful and doing it the right way. So, tips on that is, I think when you get a patient in the door and that could be from a marketing campaign, it could be from data mining your own dental records in terms of who could be candidates for implants that need it, there’s a lot of ways to get leads. So when a lead comes in, and they are absolutely medically determined that implants are a solution for their problems, is the first thing you have to do is start with getting the patient to want the treatment plan.
Dave Roehr: Don’t talk about money. Talk about the benefits to their health, talk about the change in their lives because now they’re going to be able to smile, now they’re going to be able to apply for positions in a career that they couldn’t otherwise, they’re not going to be embarrassed anymore, they’re going to improve their social life. All of the positive things that can happen just from the psychology of a patient. And then just the medical benefits.
Dave Roehr: This is going to make you healthier, this is going to do all of these benefits. So, you get them to the point where they want and need this procedure. So start with that. So once they’re there okay, now we’re going to talk about how you’re going to pay for this. And the sticker shock could be a thirty thousand dollar case, forty thousand, it all depends on the treatment plan. Like you said, give them some options on the different types of things that can be done but don’t let them walk out by saying, “I can’t afford that. There’s no way”.
Reese Harper: So if you were going to put three choices in front of somebody for a thirty thousand dollar case, three options for people to pick from, what terms would you pick to put in front of somebody?
Dave Roehr: Well, I would start with this. If somebody said, okay … well, if I’m the treatment coordinator for example and, we’re to the point where the patient wants to do this and wants the benefits of this treatment plan and, it’s three thousand dollars and you start with that, how are we going to afford this? Well, you look for the patient to say, “Look, there’s a lot of different ways we can put this deal together”. You start with, “How much cash could you put into this without affecting your life? Do you have savings, do you have some resources there?”.
Dave Roehr: So you get it to where we have some money that we can start with okay? And then we can look at a financing product. Let’s apply and see what you’re eligible for there. And a lot of cases, our credit will take care of the whole treatment plan so they can basically finance 100% of it. But if it isn’t and they aren’t comfortable borrowing that much money, well, “Hey, much much are you comfortable with on a monthly payment that you can afford? Is two fifty a month fine, does that work? Three fifty, four hundred?”.
Dave Roehr: So you kind of work to get their comfort level on affordability that could fit into their budget. And then you can really match up the financing with that because our platform will allow a practitioner to do that. And you put the deal together. So, at the end of it they don’t feel like … You’ve figured it out for them. And there’s other things you can throw into the mix on finding money-
Reese Harper: Do people feel comfortable with an eight year term? I would imagine that … What’s the most likely term that’s selected? What’s the average term of all of your loans if you did like a weighted average?
Dave Roehr: Usually they go a longer end because they want the lowest monthly payment with the idea that I give them complete flexibility because if they have extra money-
Reese Harper: They can pay it off.
Dave Roehr: They can pay extra or they can pay it off. Now we also see shorter ones where people really want rate and they’ll shorten it up and they feel more comfortable with a larger loan. And our financing, the other thing you have to understand with this is, it’s hassle free. It’s an instant decision platform.
Dave Roehr: For a patient it’s beautiful because if they’re credit is good and they’re approved, we print loan docs, it’s signed, it’s funded and it’s over. They don’t have to go to the bank, they don’t have to go to the credit union, they don’t have to fill out forms, they don’t have to produce paper and all of the hassles of a traditional loan.
Dave Roehr: It’s done, it’s there. And then if they want to go through that process later and maybe get a better rate because they can do a home equity loan or something like that, there’s a secured loan, they’re totally free to do that. But, this gets it done at the point of sale. So my whole theory is I want to create win, win, win. I want the patient to win because they get the treatment they need and want, I want the provider to win because they now do be able to perform the work and get the treatment plan to help people and then, I want to win because I want to facilitate this and make the economics work for me as well.
Dave Roehr: But everybody wins in this deal. Our provider fees are very transparent. The high end, it looks like a credit card. You accept plastic? Well, there’s a merchant fee, that’s about what the fee is. Take more risk the fee goes up. And our fees range from three and a half to I think our highest risk category if the provider wants it, is 14.9. Those are loans that-
Reese Harper: Very, very low credit.
Dave Roehr: And no one else will take them. And it really becomes, you want eighty five cents on the dollar or you want zero cents on the dollar with the margins in these procedures and it’s an incremental case. They usually only have a lab fee. They’re still making a lot of money on the case. [inaudible 00:39:42] What we do is a highly regulated consumer finance product.
Dave Roehr: We follow all the rules. That’s another important thing. You don’t want to get a provider in trouble with a compliance issue because they didn’t tell the patient something or presented something wrong or, advertised something that they can’t … Those types of things. So we help them, guide them through that. But, our product is highly regulated. There’s a lot of consumer laws that have been enacted over the years to protect consumers. So we follow all of that and we take on all of that compliance burden as well as part of the deal.
Dave Roehr: But that’s important too.
Reese Harper: Well Dave, it’s been incredibly valuable Man. We’ve talked about behavioral issues with consumers, types of credit options, talked about the industry, we’ve talked about best practices. I think you’ve really given people a lot to take home. I’m going to let you leave some parting thoughts with people before we let them go.
Dave Roehr: Sure. I think what I wanted to do is, when practices want to do large cases or in the more expensive procedures and I see a lot of practices out there, you know general dentistry is becoming corporate. I mean I’m going to tell your audience forty percent of the market in today’s world is corporate dentistry. And you know who they are, the big DSO’s, you’re fighting them. So there’s a lot of drive for practitioners to do larger cases.
Dave Roehr: Because they make a lot more money doing that and they can distinguish themselves. They don’t have to fight everyone else.
Reese Harper: You have to go where the market is unwilling to go and for the most part, large specialized services … it’s a significantly better way to enhance your practice than continue into just compete at a lower and lower and lower price for commoditized services-
Dave Roehr: Yes. I call that the race to zero. Because that’s really where it’s going. Interesting fact, I’ll just share this is is that I see doctors and dentists becoming implantologists or adding that to their practice, getting the training and getting skilled at it. And then letting the market know they’re a player in this market and then doing what they need to do. But if they do it right and this has been studied, the average dentist that can make that transition and this is average, will add to their net take home or their bottom line, two hundred and fifty thousand the first year and, up from there.
Dave Roehr: That’s more than they’re making in general dentistry-
Reese Harper: On average.
Dave Roehr: If they’re good at it it can even be more significant. But they need help and they’ve got to do it right and they’ve got be a little business savvy here and, they’ve got to get … If they’re unwilling to present financial products to patients, then they need to hire somebody that can.
Reese Harper: Yes. All right Man. Well thanks so much. I look forward to our next time. Are you still out in the West End of Nebraska then? Are you moved-
Dave Roehr: I’m in the Lincoln, Nebraska. I’m in East End. So I’m right in[crosstalk 00:42:54]
Reese Harper: Did your wife make you move back?
Dave Roehr: Yes. We’re next to the University of Nebraska so yes. I can almost see the stadium from my office.
Reese Harper: Season ticket holders?
Dave Roehr: Oh yes.
Reese Harper: Yes, okay. Right on.
Dave Roehr: Appreciated the invite to be on here and if anyone has any questions, just either Google us at our Proceed Finance or, give me a call and we’ll be glad to talk to you and help you. And love your listeners, if they’re interested in our product we’d love to try to take their business.
Reese Harper: Well, all your information and contact and website and everything will be in the show notes and people will be able to dig it up there as well. So thanks so much Dave. Really look forward to-
Dave Roehr: Enjoyed the time and thank you.
Reese Harper: Talk to you soon.
Dave Roehr: Take care. Bye.
Reese Harper: Thanks again to Dave Roehr. I really appreciated Dave coming on and sharing a lot of his background. I loved his storytelling, I loved his ability to be able to relate to patients and be able to relate to dentists. And I hope you’re able to take away from that interview just as much as I did.Practice Management