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Health Care—Financing offered for cosmetic enhancements



Health Care: Lenders Reimburse Doctors

For Uninsured Costs

All that jogging, pumping iron and calorie-counting has paid off again: For the second consecutive year, San Diego has been ranked America’s fittest city.

The survey results published in Men’s Fitness magazine is great news for local health-conscious people. But San Diegans’ quest for eternal youth is also welcome news for financial service companies providing patients with cash to pay for elective surgeries, from reconstructing teeth to lasik eye surgery and tummy tucks.

Firms offering these services include Enhance Patient Financing Inc. in Carlsbad, Health Ready, Inc. in Aurora, Colo., Care Credit Inc. in Tampa, Fla., and Unicorn Financial Services Inc. in Chicago.

These firms specialize in contracting with doctors to finance patients’ medical procedures covered only partially or not at all by insurers.

These include most cosmetic enhancements done by plastic surgeons and dentists and infertility treatments.

Most lenders pay doctors within days after a treatment, subtracting a service charge on the loan provided.

Patients can apply over the phone or via the Internet and often learn within minutes whether the lender approved a loan.

If the loan is approved, the lender sets up a monthly payment plan.

Annual interest rates start as low as 5 percent, but can rise into the 20 percent range depending on the patient’s credit history.

Trish Walsh, a plastic surgery consultant for La Jolla-based Drs. William and Charles Umansky, said companies like Enhance Patient Financing fill the need of today’s market.

Just Folks

“Most of our clients are average people,” Walsh said. “(That is) mothers with kids who need a breast lift (and) a lot of patients that come from the gyms and want to look better.”

The notion of plastic surgery as only for the “rich and famous” is a myth, she said.

But patients still must dig deep, considering most cosmetic surgeries cost thousands of dollars.

The Umanskys charge $5,000 for breast enhancement surgery, Walsh said.

It’s a two-hour surgical procedure with an equal amount of recovery time, she said. And business is booming, she said.

Some 30 percent of patients seeking surgery apply for financial aid with Enhance Patient Financing, she said.

Walsh praised the company for their speed and good customer service. Walsh selected the firm, in part, because it accepts online applications, which saves her the inconvenience of filling out piles of paperwork.

Dr. Jon O. Norton, a trained dentist and CEO of Enhance Patient Financing, started the firm in August 1999 after he realized a market niche for improved financial services.

“As a dentist, I did a number of procedures that insurance firms didn’t cover,” Norton said. “My manager went to outside lenders, but found the programs didn’t meet her needs.”

Deficiencies ranged from long processing times of applications to insufficient loans.

Fast Response

He said Enhance Patient Financing processes applications within minutes, provides credit up to $25,000, and pays back doctors within 48 hours, charging them a 5 percent flat fee per approved loan with interest.

Financing is provided by MBNA America Bank N.A. He said the average loan provided runs about $6,500. Interest rates range between 12.99 percent and 27.99 percent, depending on credit history, Norton said.

Patients make monthly payments for five years or pay off the entire loan amount interest-free within 90 days or six months.

That is provided the doctor agrees to pay the higher fee of 7.99 percent on a 90-day loan and 8.99 percent on a 180-day loan, he said. It’s up to the doctors to decide which plan they want to offer patients.

Joy Patell, regional account manager of Health Ready, which contracts mainly with plastic surgeons, claims the service benefits both doctors and patients.

“The reason doctors want to provide financing is to get as many patients as possible,” Patell said. “In today’s market, it isn’t the rich people and elite that get cosmetic and elective surgeries.”

Fee For Doctors

Patell also sees more patients applying for loans using the Internet.

The firm charges interest rates between 11.9 percent and 20.9 percent. Doctors pay a 3 percent fee on a low-risk loan; 30 percent on a high-risk loan, she said.

She finds most doctors hear about the service through ads in trade journals. But some doctors have bad experiences before they find the ideal lending firm.

Nancy Whitehead, a receptionist at Dr. James Hoag dentistry in Coronado, said she got tired of waiting up to three days to hear back from her lender and finally switched firms.

Her new lender, Care Credit Inc., provides answers within seconds while Whitehead waits on the phone.

She finds many patients still use their credit cards, not realizing a loan from a financial service firm may actually save them money.

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