New Stream of Revenue in 2022 with Patient Leasing
By: Deanna Serrano, Senior Practice Services Manager
When was the last time you paid cash up-front when you purchased a large ticket item? I was taught a while ago to take the low or no interest plan, even if I had money to pay for the purchase. It makes sense; borrow someone else’s money for a length of time and make low monthly payments. At the end of the term, I would pay the purchase off in full. This gave me the opportunity to save my money longer without penalty. Many of our patients think the exact same way. They want options that are affordable and allow them the ability to keep their money in their pockets longer. Understanding this behavior and being responsive can help your practice generate more leads, improve cash flow, and create a better patient experience. If this sounds like a winning proposition, then look no further. Phonak Freedom, our patient leasing program, will support these efforts.
Most people ask: What is patient leasing and how is it different than traditional financing?
Phonak Freedom is a true lease program, which allows patients to avoid sticker shock of unaffordable prices and make easy, low monthly payments. Inner Circle members may participate in a program designed for them, in collaboration with Allegro. Patients can lease hearing aids for 36-48 months. Patients tend to lease premium technology and experience better hearing that is affordable. In addition, patients are not subject to high monthly interest rates, on top of their monthly payment.
Leasing allows patients the best technology, for typically $179 (premium technology) per month and the Phonak Freedom program offers a 4-year warranty, in addition to early upgrades, at 36 months. Statistics have shown patients upgrade themselves to a better technology level because of low monthly payments. Good for them and your practice!
Traditional financing is a good option; however, patients experience interest fees, which increase the monthly payments and practices are subject to transaction fees of 3.5%-5% for every sale. For example, if a practice leased 10 patients per month, a traditional finance transaction fee is $300. At the end of each month the practice saved $3,000 because Phonak Freedom does not charge additional transaction fees. A practice can afford to take the $3,000 saved and invest in their business or marketing the practice.
Why should you consider patient leasing on a regular basis, or as I like to say, “Lead with Leasing”?
The Federal Reserve Bank says that around 44% of Americans self-report that their retirement savings are not on track and 25% do not have pensions or retirement savings, and another 38% would need to borrow money, either by using a credit card or borrowing from family to pay for a surprise cost such as a medical bill or emergency repair.
This means each time a patient must decide about their hearing health and the cost is $4,600-$6,600 for a pair of hearing aids, the likelihood of them saying they “need to think about it” increases. Given the statistics, having a leasing option makes sense.
An effortless way to get started with leasing is by utilizing your own database. If you reviewed the last 6-9 months of tested-not-treated (TNT) patients and determined how many patients, you might have fit if you offered a leasing option. I bet the number would surprise you. Imagine if you were able to recall 50% of the TNT patients, in your database and they purchased hearing aids; the revenue impact would be significant.
The best part of the leasing program is it offers a built-in retention program for your practice. Allegro owns the hearing instruments and as patients get close to the end of their term, they must come back and see you. This allows you the opportunity to upgrade the patient to the latest technology and repurchase or patients have the option to keep the aids or return them.
Let’s not leave out practice differentiation; leasing provides a terrific way to attract patients and referrals by advertising this option.
Providers who have not tried leasing before may need support on how to manage this solution and incorporate leasing into their recommendations. Contact your Phonak representative, who will be able to share marketing materials, FAQs, scripting, and tips for the best way to implement leasing into your practice. Allegro will support practices with their online payment portal and will educate the practices regarding the best way to manage leasing with patients.
It is time to meet patients where they are regarding flexible payment options and embrace an impactful solution, which will support your business and the patients you serve.
Visit the Inner Circle dashboard to learn more about Phonak Freedom.
References:
http://www.forbes.com October 2021, “Baby Boomers Are Leaving The Workforce to Live Their Best Lives in A Silver Tsunami ‘Great Retirement’ Trend”
http://www.bankrate.com/banking/savings/financial-security-january-2021
Deanna Serrano, M.B.A., M.S. joined Phonak in 2013 and is the Sr. Practice Service Manager for Sonova. She has held various positions over her 20+ year career in the hearing healthcare industry in management, practice development and sales. Deanna’s passion is to provide an exceptional customer experience for our Inner Circle members. When Deanna isn’t busy with practice services, she is outside kayaking, golfing or listening to an outdoor concert.