What practices
actually pay
to get paid

Across the 500 most recent statements analyzed in the benchmark study, dental practices paid an average effective rate of 3.37%. The effective rate is the all-in cost of accepting a card — total fees divided by total credit card volume — written as a single percentage. Those 500 statements together represented more than $385 million in annualized processing volume.

There is no single benchmark, but the study gives clear reference points. The overall average was 3.37%, and three in four practices paid above 2.48%. Practices on interchange cost-plus pricing — the lowest-cost structure — averaged 2.67%. When the same 500 statements were re-priced on Dental Card Services' low-cost interchange cost-plus plans, the estimated average effective rate fell to 2.22%. As a rule of thumb, a rate in the low-2% range is strong, while anything above 4% is a sign of an expensive plan: one in five practices paid more than 4%.

It depends on volume, but the share of revenue lost to fees is captured by the effective rate, which averaged 3.37% in the study. On a practice running $50,000 a month in card volume, a 3.37% effective rate is roughly $20,200 a year in processing fees. The study found wide variation — the lowest effective rate was about 1.44% and the highest reached 15.6%.

The single worst statement reached a 15.6% effective rate — more than four times the study average of 3.37%. Nearly one in five practices (19.6%) paid an effective rate above 4%.

About one in five — 19.6% of the 500 practices — paid an effective rate above 4%, ranging up to 15.6%. By contrast, 26.4% paid between 1.44% and 2.5%, 28.0% paid 2.5%–3.0%, and 26.0% paid 3.0%–4.0%.

The effective rate is total fees divided by total credit card processing volume, expressed as one percentage. It is the true all-in cost of accepting a card and does not depend on what a processor calls its plan, so it lets you compare any two statements directly. It is the single number the benchmark study measured on every one of the 500 statements.

With interchange cost-plus pricing, the merchant pays the exact interchange rate set by the card networks, plus a fixed, disclosed markup from the processor. Because the markup is transparent and fixed, it is the most predictable structure and the lowest-cost one in the study — practices on cost-plus averaged a 2.67% effective rate, the lowest of any plan type.

Under surcharge pricing, a practice is typically charged a base (qualified) rate on all transactions, with an additional rate added to transactions that don't meet certain criteria. In the study, practices on surcharge plans had the highest average effective rate at 5.25% — well above the 3.37% overall average and nearly double the 2.67% paid on interchange cost-plus plans.

With tiered pricing, transactions are sorted into buckets — typically qualified, mid-qualified, and non-qualified — and each tier is billed at a different rate according to the processor's guidelines. Because the practice rarely controls which tier a transaction lands in, costs are hard to predict. Tiered plans averaged a 3.13% effective rate in the study.

Flat-rate pricing charges one rate on every transaction regardless of card type or how it is processed. It is simple but not necessarily cheap: flat-rate plans averaged a 3.55% effective rate in the study, above the 3.37% overall average.

This is a hybrid structure. The practice pays the exact interchange rate set by the card networks plus a fixed markup from the processor — the cost-plus part — but is also typically charged additional fees across several interchange categories and/or other unique fees. Those extra charges layered on top push the cost well above straight cost-plus: these plans averaged a 3.81% effective rate in the study, the second-highest of any plan type and above the 3.37% overall average. The lesson is that "cost-plus" on a statement doesn't guarantee a low rate if surcharges and extra fees are stacked on.

Interchange cost-plus was the lowest-cost structure, averaging 2.67%. The plan types ranked from cheapest to most expensive: interchange cost-plus (2.67%), tiered (3.13%), flat rate (3.55%), interchange cost-plus + surcharge (3.81%), and surcharge (5.25%). Plan type explained most of the difference in what practices paid.

Only slightly. The study found the relationship between size and rate was weak. The smallest practices (under $25k/month) did pay more, averaging 3.86%, but above $50,000 a month the effective rate stopped improving, and even the largest practices stayed near 2.72%. Switching from surcharge pricing to interchange cost-plus closed about twice as much of the gap as growing from a small practice to a large one — so volume alone is not a reliable way to lower your rate.

Because the rate is set by the deal a practice was placed on, not the processor's name. On the most common processor in the study, practices paid anywhere from 1.79% to 15.57% — a nearly nine-fold range on a single company's platform, wider than the gap between most processors' averages. This pattern repeated across all 105 processors found. The more useful question is not who processes your payments, but what effective rate you pay right now.

The 500 statements came from 105 different processors. The processor's identity barely predicted what a practice paid — pricing structure did. (Processor figures cover the 486 of 500 statements where the prior processor was recorded.)

When all 500 statements were re-priced on Dental Card Services' low-cost interchange cost-plus plans, the average annualized savings was $7,780 per practice — a 34% reduction in the average effective rate, from 3.37% to an estimated 2.22%. Savings showed up for 96% of practices, and across all 500 they totaled about $3.9 million a year. Actual savings vary with each practice's card mix.

Because processing savings are pure profit — every dollar falls straight to the bottom line, unlike revenue, which is partly consumed by costs. The study frames $7,780 in annual savings as $7,780 in added EBITDA. To generate the same profit through new dental production would take about $51,867 at a 15% margin. And at a 7.5× EBITDA multiple, that recurring profit adds roughly $58,350 to practice value.

These production and practice-value figures are illustrative and assume the savings is reallocated to profit; they are not financial, tax, or investment advice.

The study treats $7,780 as a floor, not a ceiling. Because savings are a fixed share of card volume, they rise as three trends push volume up: practices grow, insurance covers a smaller share of each bill, and patients increasingly pay by card. Assuming card volume grows about 6% a year, the illustrative annual savings reaches roughly $13,144 by year 10, $23,539 by year 20, and $42,155 by year 30 — more than five times where it started. These later-year figures are illustrative projections.

If each year's savings is routed into a tax-deferred plan and compounded over a 30-year career, the study illustrates a balance growing past seven figures — about $1.26 million at a 6% annual return, $1.68 million at 8%, and $2.28 million at 10%. These are pre-tax, illustrative figures provided for educational purposes, not financial or investment advice; actual results vary.

The study is based on the 500 most recent merchant processing statements reviewed by Dental Card Services Alliance, each reporting disclosed card volume and total fees. For every statement, the effective rate (total fees ÷ total volume) was calculated, and each was re-priced on Dental Card Services' low-cost interchange cost-plus programs to estimate potential savings. It is one of the largest published benchmarking studies of credit card processing at U.S. dental practices.

Yes. All information was redacted to remove anything that could identify an individual practice or processor. The same masked label always refers to the same company. The data is presented purely for educational purposes to illustrate the impact of pricing structures, not to judge any individual practice or processor.

The study was published by Dental Card Services Alliance, LLC, through its publication The Dental Drilldown. It was authored by founder and CEO Alex Sadusky, who has spent nearly two decades in the dental industry. Dental Card Services has been the preferred credit card processor for the Academy of General Dentistry's Exclusive Benefits program for more than twelve years.

The 500 statements show the average — your practice has its own number. A savings analysis reviews a recent statement and shows exactly what you pay today and what you would save, typically in ten minutes or less.