The real 5th vital sign

I suggest you treat requests for unsecured credit with as much care as bank wo . . . with even more care than a bank would.

Patients who are asking for payment terms for services rendered are asking for loans. You are fronting the money for your overhead and your time. You are risking not getting paid. They, on the other hand, have your service, which cannot be repossessed if they default. So imputed interest is deserved: I recommend no discounts for those who don’t pay in full when services are rendered.

Now as to timing. Never let the debtor decide for you what they are willing to pay. You really should insist on getting as much of the charge up front as possible. Half or better at least as a down payment. If you are going to allow payments, insist that they be as large and as prompt as possible to satisfy the debt. Getting the payment in full in two installments is better than three, payment over two weeks better than one month. Never let payments stretch for months if at all possible. And get the patient to sign an agreement detailing exactly when and how payments are to be made. Have the agreement say explicitly that their payment is due in cash to be paid in person by a specific day and that they are not entitled to be “billed” for their payment. Also make clear that their payment plan is not a revolving credit account and they cannot add other charges later to the principal amount. I recommend that you stipulate that late payment is a violation that revokes the payment agreement and that for one occurrence, the entire balance is subject to immediate collection.

Of course, the better approach is to avoid becoming a consumer credit lender in the first place: when people come asking for terms, you should inquire whether they have any assets for which they could get collateralized lending (get something out of those jet ski’s in the off season). If they have a house, can they get a home equity loan? Placing their request among the terms used for other kinds of consumer transactions gives your service at least as much consideration as any other expense for which people borrow on assets.
It may even be worthwhile suggesting that patients who need lots of ongoing care for which they cannot pay go to a medical school for care in the resident’s clinic. I think it is morally indefensible to expect to have other’s labor without payment, and offering availability to a teaching enterprise at least recognizes the value of contributing something, even at an inconvenience, that recognizes other’s work has value.

As to the case where the patient demanded easy terms on pleading poverty, then drove off in the Cadillac Escalade to the country club, that is someone worth doing a credit check on. Pleading poverty and demanding terms when you really do have money isn’t “clever negotiating,” it is fraud. People who do things like that deserve to find themselves being sued for fraud and misrepresentation.