Expenses and overhead are both rising at dental service organizations (DSOs). While inflation has climbed 27%, dental reimbursement rates have risen 19% across all payer types.¹ These combined cost pressures have industry leaders seeking new ways to cut costs, but they should also explore how to unblock revenue.

To cover both bases, there are two approaches DSOs should consider. First, making it easier for patients to pay: card-on-file, online payment, text-to-pay, or flexible payment plans all reliably reduce accounts receivable (AR). Second, offsetting card processing costs with health-care-compliant surcharging.

1. Making it easier to get paid

With just under half of US adults saying it’s difficult to afford the costs of care, practices should evaluate both the convenience and flexibility of their current payment systems.² Payment workflows are often another self-imposed barrier to revenue.

To patients, more choice means fewer obstacles, so when health-care organizations offer increased payment options, they get paid more. Auditing your current collection processes can reveal payment methods your team might not have considered, such as:

• Online payments: 75% of patients want to pay their bills online. Letting them pay their way is an easy way to boost revenue.³
• Text-to-pay: Bulk text delivery of payment links can significantly accelerate collection. In one recent example, a practice collected more than $350,000 within two hours of launching a text-to-pay outreach campaign.
• Payment plans: Not only did 63% of patients express interest in payment plans, but 33% would switch to providers who offer them.⁴
• Keeping cards on file: Automatically charging authorized cards on file, co-pays, and payment plans increases time-of-service collections.

This unblocks revenue, but credit card payments also increase expenses.

That’s why DSOs are increasingly turning to surcharging. The value of offsetting processing costs is easy to understand, but the challenge is getting it right. For health-care organizations, surcharging invites risks other industries don’t face. Plus, choosing the wrong tool might cost DSOs more than it saves.

2. Offsetting card processing costs

DSOs must clear regulatory hurdles before they can safely adopt surcharging. The first is knowing which transaction and payer categories must be excluded: debit, prepaid, flexible spending account (FSA), and health savings account (HSA) cards. Medicare and Medicaid also prohibit consumer-facing credit card fees on applicable copays or reimbursed services.

Then, state laws and card network rules govern how surcharges can be applied. Both can change independently without written notice to dental practices. Contracts and partner agreements at individual practices add another layer, restricting when and whether a fee can be applied at all.

For DSOs, the challenge isn’t just managing these overlapping requirements across every location; it’s ensuring staff know when and how to apply fees at checkout. If your current revenue cycle management (RCM) processes don’t address those challenges, your organization will put both patient satisfaction and cost recovery at risk.

Related: The risks and costs of credit card payments: What dental offices need to know

The hidden costs behind fee recovery

Surcharging is a proven way to offset fees, but it must be executed correctly for the savings to materialize.

When surcharging products deposit surcharge dollars alongside operating revenue, staff must separate the fee amounts, update ledgers quickly to avoid distorted reporting, and explain discrepancies to auditors. All this manual work erodes the savings surcharging produces.

Seek solutions that automatically separate fees from revenue, reduce the risk of human errors, and let a DSO preserve the processing-cost offset without creating a new accounting burden.

Implementing a smart surcharging strategy

Within a broader payment strategy, healthy surcharging programs require consideration of both staff practices and technology:

• Staff practices: The strongest surcharging programs give patients written notice at the point of booking and reinforce it through consistent communication at checkout, with staff trained well enough on the rationale to field questions when they come up.
• Payment technology: The most reliable platforms are built around the regulatory landscape and each practice's specific contract terms, while connecting with the practice management system for accurate posting and reporting.

That means handling the 30-day notice to the processing bank during implementation, keeping surcharge funds separate from operating revenue, and validating each transaction against state rules and bank identification numbers (BINs) to confirm the payment type is eligible for the fee.

Offering fee-free payment options like debit, ACH, HSA/FSA cards, and cash—plus payment plans and patient financing—prevents friction and gives patients more flexible ways to address balances.

Future-proofing DSO payment strategies

With 41.5% of dentists citing rising expenses and overhead as a top concern, DSOs must holistically reevaluate their current payment strategies.⁵ Combined, offering more ways to pay and deploying health-care-compliant surcharging increases DSO collections and offsets processing costs. That’s why both approaches merit careful consideration.

Dental cost pressures aren't easing anytime soon. Forward-looking DSOs are recognizing that collections and payment costs are two sides of the same equation and managing them accordingly.

References

1. The State of the U.S. Dental Economy. 2nd quarter 2026 update. American Dental Association Health Policy Institute. 2026. https://www.ada.org/-/media/project/ada-organization/ada/ada-org/files/resources/research/hpi/state_us_dental_economy_q22026.pdf
2. Americans’ challenges with health care costs. KFF. September 29, 2026. https://www.kff.org/health-costs/americans-challenges-with-health-care-costs/
3. “Trends in Healthcare Payments” annual report. J.P. Morgan. March 26, 2024. https://www.jpmorgan.com/insights/payments/trends-innovation/healthcare-payment-trends
4. The healthcare payment experience. PYMNTS and Rectangle Health. January 2021. https://www.pymnts.com/study/healthcare-payment-experience-rectangle-health-digital-medical/
5. Economic outlook and emerging issues in dentistry 4th quarter, 2025. American Dental Association Health Policy Institute. 2025. https://www.ada.org/-/media/project/ada-organization/ada/ada-org/files/resources/research/hpi/q42025_economic_outlook_dentistry_main.pdf