Hearing aid financing is one of the most discussed financial options among service providers today.
While it is true that hearing aids are a technological marvel that can change lives, they also come at a cost. At times, they can be so costly that those who are in need are unable to access them. Either that or people delay purchasing them for as long as possible.
Fortunately, there are hearing aid financing options available that service providers like you can offer to your patients.
In this blog post, we will cover the different hearing aid finance options that businesses leverage as well as the way in which you can go about offering the best type of solution for your customers.
Let’s dive in.
An Overview of Hearing Aid Financing
Hearing aid financing is an option granted to patients suffering from hearing-related medical problems to cover the cost of hearing aid under favorable repayment terms and conditions.
The hearing aid chosen by your patients will largely depend on their hearing needs and the severity thereof. There are two factors that determine hearing-aid cost:
- The amount charged by hearing-aid manufacturers for each hearing device;
- The amount negotiated between audiologists (those who provide care) and insurance companies or third-party payers (who bear some responsibility).
For that reason, there are multiple ways in which hearing aid can be financed. For instance, it may consist of a payment plan where the patient has to pay back the cost of the hearing aid based on the applied interest rate. Conversely, it can also be done through 0% financing if the service provider opts to go that route.
Contemporary and innovative finance options arose when clinics saw that a growing number of patients became more hesitant to use traditional sources of credit financing such as credit cards.
Patients are less inclined to use credit cards to finance hearing aids because credit cards usually come with elevated interest rates. Even if hearing aids are purchased through a credit card, there is the added expense of monthly interest payments that can quickly add up.
What's more, some patients are ineligible to access credit options either because they have a bad credit history or do not meet one of the eligibility requirements established by the credit company.
In a nutshell, traditional finance options used by patients have become less attractive. For that reason, clinics themselves are now exploring different ways to finance the hearing aids that their patients wish to purchase.
Benefits of Hearing Aid Financing
Those clinics that offer hearing aid financing tend to enjoy several benefits for overall growth and revenue increase.
Let's examine some of these benefits:
- Tap into larger patient bases: Clinics that offer hearing aid financing tend to reach more clients. This is because financing makes your services more accessible to customers and therefore increases the likelihood that you will acquire more clients over time.
- Increased revenue gains: Those clinics that provide hearing aid finance solutions to patients augment the chance that they will pull in more sales. This is because the more accessible your services are to your customers, the more service orders you will receive, thus leading to more sales.
- More customer referrals: Those patients who need assistance paying for their hearing aids will often refer family members or friends looking into purchasing new hearing devices to your clinic as well. Customer referrals are a free form of marketing that allows you to pull in more patients thanks to the positive experience customers have had with your clinic.
Clearly when it comes down to profitability and growth, offering hearing aid financing is advantageous for any clinic seeking these benefits. Patients appreciate having access to funds on credit terms.
However, in as much as hearing aid financing can help clinics grow, if you don't offer the right type of finance plans, you may end up working against your ultimate goals.
Let us examine some of the finance options that clinics can offer to their patients.
Types of Hearing Aid Financing
In most cases, clinics can choose between one of two ways to offer hearing aids financing to their patients: either by managing it internally directly through your clinic or by doing so externally and partnering with a third-party lender who takes the challenge of managing financing off your hands.
Let's dive into each one.
Internal Hearing Aid Financing Programs
Internally managed hearing aid financing programs are, in essence, a way for clinics to offer the financial solution of hearing aids that their patients need without actually handling any credit-related transactions.
In doing so, a clinic creates its own proprietary hearing aid financing program. The clinic assumes sole responsibility for hearing aid financing and credit-related transactions as well as all other aspects related to the management of the finance program.
In such cases, the clinic needs to meet certain legal requirements. For example, a hearing aids finance policy needs to be drafted and approved by stakeholders and senior management alike in order for this service to be offered.
What's more, they are also required to upkeep and update a list of eligibility requirements and ineligibility charges where necessary for each of the financial programs you are offering. This can be gathered in the form of an official document that can be subsequently circulated among potential clients letting them know more details about the service being offered.
This type of program is heavily reliant on staff and clinic policies.
As a result, clinic employees are expected to have a firm understanding of policies and enforce them where necessary. Failure to do so will result in compliance compromises with clinical regulations which can land you in legal trouble or unnecessary fines and sanctions.
Usually, clinics offer these programs by requesting that the patient pay a percentage of the fee on their service upfront. The clinic then examines the patient's credit score and uses their credit information to put in place a payment plan that the patient must adhere to.
While internal hearing aid finance programs are an option for patients, they are far from perfect.
Let's take a look at the challenges associated with these types of initiatives.
The Danger of Offering Internal Hearing Aids Financing
As a clinic, offering internal hearing aids financing to patients can be a highly risky practice.
- Payment defaults: One of the most glaring risks associated with offering hearing aids financing is that patients may not be able to commit to the payment, thus leading them to default on their loan. On one hand, this can lead to credit damage for your patients, something which can result in them filing for bankruptcy. What's more, it also implies either a delay in the patient's payment for your services or an outright inability to do so.
- Elevated default percentages: Internally finance programs tend to have a higher rate of default patients than those which are managed by third-party lenders. This is because external institutions usually have stricter eligibility requirements that reduce the chances that potentially problematic clients slip through and end up leveraging a clinic's services.
- Credit score issues: On one hand, internal hearing aids financing can only be applied to those patients who can demonstrate a credit history. Therefore, it excludes those patients who cannot display their credit information. On the other hand, it does not provide a solution to those patients who may be in a good financial place yet their credit score does not reflect so because of a negative history they had with borrowing.
- Payment discrepancies: Offering internal hearing aids financing means that your company is responsible for handling any payment discrepancies on behalf of its customers, which could lead to legal issues if you're unable to recoup losses incurred through these types of arrangements.
Having examined these elements, let us now turn our attention to the second option that clinics have at their disposal for financing; external finance programs.
External Financing Programs
External finance programs are the preferred option by clinics as they provide the most streamlined and effective method to offer hearing aids financing.
This is because external hearing aid financing programs are typically third-party lending providers that have established relationships with a range of clinics in order to facilitate their services.
As such, clinic owners do not need to worry about any legal disputes or administrative nuances when using these types of financing channels.
Ideally, one of the most common types of external finance programs is flexible finance plans.
A flexible finance plan is a hearing aids financing option that is tailored to the needs of a particular hearing clinic.
By their nature, flexible finance plans grant clinics the ability to set their own repayment terms and conditions for hearing aid purchases that suit their individual business model and patient profile.
This means you can offer hearing aids financing options such as installment payments or leasing contracts on your terms while still providing patients with access to hearing healthcare services at an affordable price point.
There are several types of lenders that offer these services. However, clinics typically benefit more from those who have a strong-rooted value system that emphasizes customer-first solutions. That way, they are more likely to understand your needs as a small business in the hearing aids field and design solutions that work.
Benefits of Flexible Finance Plans
Some of the main benefits associated with flexible finance plans for entities that offer hearing aids as a service include:
- Higher hearing aid sale conversion rates: Clinics that offer flexible finance plans experience greater chances for an increase in the sales of hearing aids. This is because the flexible nature of the finance plan makes the service more accessible to customers.
- Improved customer loyalty and retention: Customers are more likely to stay loyal and continue their hearing aid service with the company if they have access to a flexible finance plan. This has a positive impact on your overall business and growth strategy since client retention is usually always cheaper than client acquisition. Therefore, flexible finance plans help you in the long term to double down on solid and sustainable growth goals.
- An increased market share: Providing customer hearing aid financing increases your market share be it on a local or regional scale. This is because you are delivering solutions that allow you to stand out among your competitors in a positive way.
- A better customer experience: Offering flexible hearing aid finance plans will give people a more enjoyable purchasing experience and provide them with a sense of relief knowing that they can afford your product or service even if it may be too costly for them to pay in one go.
How To Choose a Hearing Aids Third-Party Lender
Flexible finance plans form one of the pillars of a solid hearing aids finance strategy.
For that reason, careful attention must be paid to the type of lender you partner with.
it's important to align with a third-party flexible finance lender who has the right values and morals that will deliver the kind of legitimate, professional customer-centric solutions you need to increase the margin of success of your finance solutions.
Here's how you can team up with Time Investment Company to do just that.
Flexible Finance Plans with Time Investment Company
Time Investment Company is a finance company that has spent the last forty (40+) years assisting businesses to secure the financial solutions they need to succeed.
For years, we have collaborated with entities within the medical, cosmetic, dental, and healthcare sectors respectively to help them craft and implement winning flexible finance plans that attract customers and bring higher service orders. With TIC, hearing aid service providers such as yourself now have the ability to offer flexible and affordable payment options that still promise you a respectable profit margin on each patient.
Our process is straightforward. Once a patient has confirmed their order, we release the full payment amount to you so you can secure the capital you need as soon as humanly possible.
We at TIC at committed to delivering financial solutions that work.
Set up a strategy call with one of our team members who will walk you through the application process.
Start Offering Hearing Aid Financing
Hearing aids financing has the potential to be a lucrative practice for those clinics that align with the right third-party finance companies.
Time Investment can help you.
Book a strategy appointment with us so you can start delivering the kinds of solutions your customers are looking for.