The HELPcard offers a variety of financing options that are beneficial for both patients and dispensers.
As many hearing instrument dispensers know, the toughest part of their job is not fitting an instrument or even staying abreast of the most cutting edge technology. The most difficult task can be closing the sale. This is where The HELPcard can come to the rescue.
Started 20 years ago to cover the dental market, by Dent-A-Med Inc, The HELPcard now covers the entire gamut of health services including hearing products. Now its own separate company headquartered in Springdale, Ark, and boasting about 75 employees, The HELPcard has about 500 hearing aid dispensers on its rolls whom it helps to increase their revenue by making it easier for patients to purchase hearing instruments.
A Revolving Credit Card
The HELPcard is a revolving credit card, like MasterCard or Visa. Patients who qualify for the card are issued a line of credit, receive monthly statements, and are required to pay a minimum balance—3.25% of the outstanding bill. According to Pat McGee, vice president of marketing for The HELPcard, the financing mechanism fills a very specific niche. “There are folks obviously who can afford to pay for the service out of their existing resources—they can write a check,” he says. “This program offers an alternative method for paying for health care needs, which allows [patients] to leave their MasterCard, Visa, [and similer accounts] for other discretionary spending. In other words, they don’t have to use up their MasterCard credit line for paying for this [hearing instrument]…[and it] is another way to pay when you don’t have the resources available on your card. Finally, we have some optional interest-free plans that dispensers use to promote customers to go in and purchase the hearing aid. The dispenser can offer a deferred interest program for as long as 12 months.” The HELPcard can be used only for out-of-pocket health care-related expenses.
Though The HELPcard can help patients by giving them a mechanism to purchase the hearing instruments that can improve their lives, there is also a tremendous benefit for dispensers as well. “There are two ways that a dispenser is going to benefit from having a finance package like ours in their office,” says McGee. “If a dispenser uses our type of financing…he can sell payments instead of retail price. So, he will have increased sales. It will help him close more sales and increase his bottom line. Another thing that is equally as important or more important is upsizing.” For instance, McGee says, if a patient could afford to pay for only an $1,800 hearing instrument, using The HELPcard, the dispenser could sell the patient a $2,600 instrument that would offer the patient better performance and increase the bottom line, while increasing the patient’s monthly outlay for the instrument by only $20.
Benefitting the Dispensers
The HELPcard financing option has another benefit for dispensers. Dispensers are paid the entire amount of the sale—minus a 4.9% service fee—up front. The HELPcard is non-recourse, so, if a customer fails to pay, the dispenser will not be penalized and will not have to handle any collections duties. Patients can receive approval to receive The HELPcard while they are in the office purchasing their instrument.
The company provides the dispenser with all the materials and training needed to sell The HELPcard to patients. “Once a dispenser has made the decision to enroll in our program, the first thing that we do is send them a start-up kit, which includes materials like credit applications and brochures they can display in their office,” says McGee. “Inside of that start-up kit is a quick reference guide. We have a training coordinator in the company, and it is her responsibility to train all of our enrolled dispensers once they’re in the program, and any time thereafter, when they have staff turnover or they have questions, [she is available].” Patients can be signed up during the office visit with the application faxed or, if it is a real rush, phoned in, and can get an immediate response, so they can use they card and its credit line immediately.
The company even prepares staff for the awkward moment if a patient is turned down for The HELPcard. “The notification goes to the dispenser’s office,” says McGee. “Most of our dispensers are faxing in their application, so our system faxes back an approval or decline notice. It gives a generic reason on that notice if there is a decline as to why, the office staff communicates that decline to the customer, and by law we also mail to that customer a decline notice that specifically indicates which credit bureau we used to make that decision, what our decision was based on, and telephone numbers for that credit bureau should the customer want to talk to them.”
The company markets The HELPcard to dispensers in a variety of ways including advertising, trade shows, mailers, and cold calls. “We do not walk into their offices,” says McGee. “We try to wet their whistles and sell them over the telephone.”
The HELPcard is also looking at different ways to capture business. This has resulted in taking a cue from an unlikely source, the automobile industry. Leasing is the next big finance option that will hit the scene, says McGee, and The HELPcard is leading the way. “The advantage for the consumer under a lease—similar to what you see with automobiles—is that the payment is actually lower than if you were financing,” says McGee. “It is a 3-year term, and it can include all the servicing and loss and damage, and warranty protection for the entire 3-year period, if the dispenser wants to include that in the sale price.”
Offering Options
Like a car, at the end of the 3-year lease, patients have three options: return the hearing aid and move on, start a new lease with a new hearing aid, or purchase it outright at 20% of the total price. The leasing option, which is targeted to upper-end purchasers, is very advantageous to the dispenser. “Because the customer has to return the hearing aid back to the dispenser at the end of the lease, the dispenser has a captured customer,” says McGee. “And that happens in 3 years instead of the 5 to 7 years that are typical out in the market. Now he’s got a shot at either leasing them a new set for another 3 years or, if this time they’re in the market for purchase, selling them a set of hearing aids. So in a sense he can almost half the amount of time that he may see that customer and double his sales.”
There are other financing options as well that The HELPcard is looking at including an installment plan. The company is also in the process of developing alliances with manufacturers.
McGee says the biggest change in the financing marketplace is the demographic shift in the market to the Baby Boomer, and that will present challenges to the dispenser who has not offered credit to his customers. “What [Baby Boomers] are used to versus the folks that are traditionally purchasing hearing aids is credit,” says McGee. “They’ve bought everything on credit. They’re going to demand installment plans, or revolving credit plans, or leasing plans. They will want to know all about the technology and how they can pay for it with credit. But for the dispensers that want to take advantage of this market, if they really don’t know how and they’re not employing financing tools, their competition is going to leave them in the dust.”
Chris Wolski is associate editor of Hearing Products Report.
