A Dynamic Payment Plan is an open ended repayment agreement.
In the Account Module, the Payment Plans grid lists all payment plans associated with the family.
In the toolbar, click Payment Plan, Dynamic Payment Plan, or double-click an existing plan to edit.
Dynamic payment plans are designed to allow the creation of a flexible repayment agreement.
When a dynamic payment plan is first created the window will default to the Production tab (see below). Use the Add button to attach production to the plan, after which you can choose terms, including Payment Amount or Number of Payments, and Charge Frequency. Click Create Schedule to generate an Amortization Schedule. Use the Sign & Print button to complete the agreement.
Note: If the plan is later changed to include additional production changing the repayment term, you will want to have the new version signed and printed.
Category: Assign a category to this payment plan (e.g. Ortho, Implant). Useful to distinguish one payment plan from another when families have many plans. Customize the category options in Definitions: Payment Plan Categories.
Patient: The person who was treated. Click Go To to switch to their account. Patients can have multiple payment plans, and each plan can have a different guarantor.
Guarantor: The person who will make the payments. It does not have to be in the same family as the patient. It also can differ from the account's guarantor. Click Change to select a different guarantor. Click Go To to switch to their account.
Full Lock: Check the box to lock current terms of the payment plan. Prevents any further additions to production or changes to the repayment schedule. Adding an APR interest rate requires that the plan be locked.
Terms that affect the Amortization schedule:
- Date of Agreement: Defaults to today's date. Cannot be back dated.
- Total Principal Amount: The total amount of the payment plan, not including interest. It calculates based on the total attached production.
- Date of First Payment: Defaults to one month from today's date. If the first payment is today, enter it as the down payment and set the Date of First Payment as one month in the future.
- Down Payment: The amount of the down payment.
- APR: The percentage of interest to charge on the principal balance of completed procedures. If entered, additional options are available to delay interest charges. Payment Plan must be locked to use.
- No interest for the first [ ] payments: The number of payments before interest is applied.
- Interest start date: The date of the first interest charge.
Note: Enter only one. If both fields are left blank, interest is charged to all scheduled payments.
- Payment Amount: The amortization schedule can be based on a total number of payments or a specific payment amount. Number of payments will be calculated automatically. Enter only one.
- Number of Payments: Enter a number of payments the schedule will be based on. Payment amount will calculate automatically.
- Charge Frequency: Select the frequency of which charges are applied to the payment plan. The options are:
- Every other week
- Specific day of the month
- Handle Treatment Planned: Determine whether treatment planned procedures should be included in the total now, or as the work is completed. If toggling this setting, click Create Schedule to see changes.
- Await procedure completion: Do not include treatment planned procedures in the Amortization Schedule until the work is completed.
When selected, treatment planned work will not display on printed payment plans. Users may need to have the payment plan re-signed by the patient each time work is completed.
- Procedure as complete: Include treatment planned procedures in the Amortization Schedule. The total for treatment planned work will display as a credit on the patient's account until the work is completed.
Create Schedule: Create the amortization schedule based on the terms. A description of the terms will show in the Note field.
Once the schedule is created, these calculations are automatic:
- Total Cost of Loan: Total Amount plus interest and any added charges.
- Accumulated Due: The total amount that has been due up to the current date.
- Paid so far: The total amount that has been paid towards the payment plan to date.
- Principal paid so far: The total amount that has been paid towards the principal to date.
- Tx Completed Amt: The total fee amount for charges that have come due.
- Total Tx Amt: The total fee amount for all production that is attached to the payment plan. Will not display until after plan has been saved by clicking OK.
Amortization Schedule: The amortization schedule is generated based on the terms. Principal and interest are calculated automatically. Due dates are based on the Date of First Payment and selected charge frequency.
Note: Because charges may be spread across multiple procedures or adjustments, multiple entries may list for a single date in the schedule. The amounts for each line item on that date will add up to the total amount of the charge for that day.
- A horizontal bold line indicates today's date and separates past items from future items.
- Line items in black represent charges that have posted to the account. Gray line items are projected future charges. Charges are actually posted to the account using the Open Dental Service daily at the time determined in Account Module Preferences.
- Gray items can change if production is added or removed, or additional payments are made.
- Payments attached to this payment plan show as green credits and affect the running balance. If extra payments show here, but should not, uncheck the Attached to Payment Plan box on the Payment window for each payment.
- Exclude past activity: When checked, only future dated line items show in the Amortization Schedule and past activity is hidden. When unchecked, all activity shows. Totals are not affected by this setting. To set the default setting for the checkbox, see Account Module Preferences, Payment Plans exclude past activity by default.
Interest: Open Dental automatically calculates interest (APR) using the following method. Most online calculators use the same method, but some may differ (e.g. assume down payment is first month's payment). Adding an APR interest rate required that the Plan be fully locked.
- Subtracts the down payment from the payment plan balance.
- Calculates the number of payments, or the payment amount, based on the new balance (balance minus down payment).
Note: When you create the schedule, a detailed note of the terms shows for future reference. Other notes can be added as needed.
Sign & Print: Only displays when using a custom sheet for Payment Plans, and a signature box is added to the sheet. Click to sign and print the payment plan. See Sign and Print Payment Plan.
Click OK to create the Payment Plan.
From the Production tab you will add procedures and adjustments to the payment plan. Unlike normal payment plans, the total amount is not fixed and additional procedures and adjustments can be added.
- Production for a given procedure can only be attached to a single payment plan.
- Adjustments and insurance payments applied after the plan was created will change the amount of future charges if the Amount Attached does not have an override.
Delete: Delete the selected production item from the attached production list.
Print: Click to print list of attached production.
Add: Click to open the Select Production window.
Highlight procedures and/or adjustments to be included in the payment plan. Only adjustments that are not attached to procedures are listed.
- Adjustments attached to procedures reflect in the Amount End field for the procedure.
- We do not recommend selecting negative adjustments for attachment. Instead, attach them to a procedure first, and then select the procedure to attach it to the payment plan.
The procedure or adjustment Amount Attached defaults to the remaining balance of the production fee after insurance estimates/payments, negative adjustments, and patient payments. Edit the amount to override the default production amount attached to the payment plan with a new amount. If the amount is changed, additional insurance payments or adjustments applied towards the production will not automatically update the payment plan.
Editing an Existing Plan
Double-click to open an existing dynamic payment plan. The terms will be grayed out.
Click Unlock to edit the terms or add additional procedures or adjustments.
Delete: Click to delete the entire plan. Also, clears any Authorized Recurring Charges attached to the plan. Payments cannot be attached.
Close Plan: Close Payment Plans that are no longer being paid on. Any remaining production items that did not have a pay plan charge will be removed from the payment plan. The production amount will be subtracted from the total principal and the pay plan credits will be removed from the account.
Plans with APR cannot be edited. You must create a new plan to add treatment instead.
Payment and Interest Logic
Patient payments made towards a dynamic payment plan are first applied to any pay plan interest charges that have posted to the account. After the interest is covered, any payment amount left over is then applied to the principal balance.
When a patient pays more than what is currently due on the Payment Plan, the following prompt will populate:
- Click Yes to apply the excess amount to the principal balance and recalculate future interest charges. A new pay plan charge (PayPln:Debit) is added for the excess amount.
- Click No to apply as a prepayment. When the next pay plan charge is posted the excess payment amount is transferred from the principal balance to the interest on the new charges. Payments may also be transferred from the principal balance to interest charges when a payment for a due charge is missed.