Patients want access to high-quality medical care, but for many, healthcare costs are a major hurdle. Rising out-of-pocket costs, high medical bills, and gaps in health insurance coverage are leading to increased medical debt and delayed treatment — not to mention overwhelmed front office teams trying to manage payment logistics.

Across the healthcare industry, providers are facing an urgent question: “How can we make care more accessible while improving cash flow and reducing administrative burden?”

What is Patient Financing?

Patient financing is the general term for programs that let patients pay for medical care over time instead of all at once. Practices offer it either in-house, extending credit directly to patients themselves, or through a third-party financing company that manages approvals, funding, and collections on the practice's behalf. It's the same category of solution as buy now, pay later, healthcare credit cards, and specialized medical lenders, just described from the provider's side of the transaction.

Patient Financing: The Solution for Patients and Practices

Patient financing offers a practical and patient-centric solution. By allowing patients to break large medical expenses into manageable weekly and monthly payments, healthcare providers can:

• Improve patient access to necessary care
• Strengthen financial health across departments
• Get paid upfront, avoiding bad debt and delayed collections
• Provide a better patient experience, which fuels patient satisfaction and loyalty

Whether you're a small med spa, a growing hearing care practice, or part of a large health system, patient financing solutions help optimize your revenue cycle while improving access to care.

The Step-By-Step Guide to Offering Patient Financing

Before you choose a patient financing solution, it’s important to determine which financing model best supports your operations, patients, and bottom line. Here’s how to build a financing strategy aligned to your unique practice needs:

Step 1: Identify the Gaps

Start by assessing the specific financial challenges in your practice. Are patients delaying or declining care due to pricing concerns or out-of-pocket costs? Is your staff spending too much time chasing down medical bills and managing receivables manually?

If you frequently hear patients ask about payment options or notice incomplete treatments trending upward due to cost, it’s a strong signal that financial barriers are impacting patient access. These gaps don’t just affect your bottom line — they also detract from the overall patient experience and contribute to medical debt.

Step 2: Define Your Financial Objectives

Different financing programs serve different goals, and no two practices are the same. Once you’ve identified the unique challenges you’re facing, determine how you want to solve them. What does your finance program need to achieve? If you need to…

• Enhance working capital and cash flow: Choose a model that gets your practice paid upfront.
• Increase patient conversion: Look for financing companies with high approval rates across all credit scores.
• Reduce risk: Use non-recourse models, where the financing company takes on the risk of patient default instead of your practice, so a missed payment doesn't become your liability.
• Automate billing: To reduce administrative burden, seek platforms that integrate with your system or have self-managed platforms for patients.

Whether your goal is revenue, efficiency, or financial stability, your financing strategy should reflect that.

Step 3: Pick the Appropriate Financing Model

Generally, there are two categories of patient financing options: in-house financing and third-party patient financing companies.

In-House Financing

In-house financing gives you full control over the terms, eligibility criteria, and communication with patients. However, it also requires your healthcare business to act as the lender — meaning you’re responsible for communicating with credit bureaus to check eligibility, setting up payment plans, tracking monthly payments, and managing delinquencies.

For practices with limited staff or minimal experience managing receivables, this adds significant administrative burden and exposes your business to financial risk. Still, in-house programs can be a good fit for medical providers with loyal patients, extensive resources, and strong cash reserves — particularly in sectors like plastic surgery or dentistry.

Third-Party Financing

Third-party patient financing companies, by contrast, handle the entire application process, including credit checks, eligibility decisions, underwriting, and payment collection. You receive full reimbursement upfront, often through non-recourse loan programs, which means you're protected even if a patient defaults.

This model is ideal for busy healthcare companies that want to focus on patient care, not billing. With built-in automation and seamless integration into your workflow, third-party solutions offer an efficient, low-risk way to improve both patient access and financial health. There are several types of third-party financing:

• Traditional Buy Now, Pay Later (BNPL) Platforms – Traditional BNPL platforms allow customers in a variety of industries, from retail to healthcare, to pay over time for goods and services with flexible payment terms and often interest-free periods, offering affordability and peace of mind at the point of sale.
• Healthcare Credit Card Issuers – Offer patients a revolving line of credit dedicated to medical services, often with promotional interest rates and flexible financing options across multiple treatments or visits.
• Fintech Lenders – Provide tech-enabled, fast-approval healthcare financing with personalized offers, making it easy for patients to understand how it works and commit to care without delay.
• Specialized Healthcare Lenders/BNPL – Specialized financing companies, like Cherry Payment Plans, focus solely on medical services and often serve patients with a broader range of credit scores, offering fixed payment terms and tailored support for different specialties like dental, cosmetic surgery, and veterinary care.
• Embedded Financing Platforms – Seamlessly integrate into your systems and patient flow, enabling real-time decisions and branded payment options that make financing feel like a natural extension of your healthcare organization.

These models provide options that align with different specialties and patient demographics, while also offering strategic financial tools that can restructure or refinance existing patient debt portfolios.

Step 4: Select the Right Financing Partner

If, like many healthcare practices, you decide to go the third-party route, it’s important to keep in mind that not all patient financing companies are the same. Ask these questions before committing:

• What are the approval rates, especially for patients with lower credit scores?
  
• How much are the approval amounts?
  
• Are the interest rates patient-friendly, with no surprise interest charges? Is there a 0% annual percentage rate (APR) option, and is it truly zero-interest or based on deferred interest (bad for borrowers)?
  
• Is the platform easy to use and accessible via online banking or mobile?
  
• Do they offer flexible loan amounts and terms?
  
• Can I offer healthcare financing options for various specialties like skilled nursing, behavioral health, or surgery centers?
  
• How quickly are providers reimbursed — and how does this affect my practice’s liquidity?
  
• What are the charges to providers? Is there a merchant fee?
  
• Do they offer in-house support for patient questions and FAQs?
  
• What are the reviews like from other providers and patients?

Step 5: Operationalize Financing Within Your Workflow

Once you’ve selected a financing partner, the next step is integrating your patient financing program into your daily operations.

Your team should be well-equipped to discuss payment options, guide patients through the application process, and handle basic FAQs. Promoting financing solutions clearly and consistently will improve enrollment, boost patient satisfaction, and ensure your new financial solutions deliver real results.

Most importantly, the right tools should automate key steps to reduce administrative burden and support a smoother financial experience for everyone involved.

Key steps to operationalize your patient financing strategy:

• Train your team on how to communicate payment plans, explain eligibility, and prequalify patients.
• Promote financing offers across your website, social media, in-office signage, and email campaigns to boost awareness and patient financial engagement.
• Integrate automation with your EHR, CRM, or point-of-sale systems to streamline patient payments, billing, and reimbursement.
• Use embedded tools from your financing company to provide real-time approval decisions, digital applications, and mobile access.
• Monitor metrics like treatment acceptance rates, receivables turnover, and financial health to track performance and make data-driven improvements.
• Offer clear support for patients with varying credit scores, ensuring options that meet their specific needs and improve affordability.

Together, these steps empower your team to provide quality care while enhancing the financial stability of your healthcare practice.

Transforming the Patient Experience

Implementing patient financing programs isn’t just a billing upgrade — it’s a transformation of the care experience. Patients feel more empowered and less anxious when they have affordable, transparent payment plans tailored to their budgets.

It also builds trust. Offering compassionate financing solutions shows you care about the whole patient — not just their treatment, but their financial health, too.

When Financing May Not Be Necessary

While powerful, patient financing isn’t a fit for every situation. You may not need it if:

• You primarily offer low-cost services that patients can cover with credit cards or cash
  
• Your patients readily move forward with the recommended treatment plan
  
• Your existing pricing already matches your patients’ budgets

In these cases, adding financing may overcomplicate your systems without significant ROI.

Close the Care Gap with Cherry

At Cherry, we help providers across the healthcare industry offer flexible financing that improves both patient outcomes and practice performance. Our solutions are built for modern practices and designed to reduce provider risk while reducing financial burden for patients.

Here’s what makes Cherry the preferred choice of more than 80% of practices.

• Approval rate of up to 90%
• Funding up to $65,000 with true qualifying 0% APR options
• No deferred interest
• A 35-second application that doesn’t hurt patient credit score
• Instant approval decisions
• Loan terms from 1 to 60 months
• Upfront payment to practices
• Lowest merchant fees in the industry
• Seamless integration and automation functionality
• Trusted by over 60,000 providers

Whether you're looking to reduce financial barriers, improve reimbursement, or grow your small business, Cherry is here to help.

Find out why Cherry is chosen 5x more often as the leading financing partner versus Sunbit, CareCredit, and PatientFi. Book a free demo to see how our patient financing solutions can make a difference for your team, your practice, and your patients.