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Save the Date! Collections Made Comfortable Seminar

Everyone on Your Team Has to Deal With Patients, Money and Insurance. Make Sure They Know How!

This perennial favorite is a must-attend for you and your team. Dealing with patients, money and insurance is something you have to do every day so why not do it well? And, it takes the whole team!

Take the confusion out of dental fees and insurance so your patients follow through on treatment and your schedule stays full.

Register by May 15th and receive $40 off per attendee!

This seminar is almost always a sellout. As clients, you get first dibs and a discount! $179 first person and $159 each additional.

CALL TODAY (952-921-3360) to reserve your space before we do our general mailing.

How Good is Your Hygiene Department?

We all know that the hygiene department’s performance has a direct bearing on the health of your patients and your practice’s bottom line.

I’ve grown weary of rules of thumb for hygiene like “Hygiene should be 30% of practice production” or “Perio should be 30% of hygienist production.” I don’t like that kind of measurement because it’s often misleading. For example, if a doctor does a lot of high end restorative dentistry it will make the hygiene department percentage look low.

Of course, we measure hygienists’ production per hour. That number can be a little spongy sometimes depending on how well the hygienists track their hours worked, downtime, etc.

So, we increasingly use: “Production Per Hygiene Visit.

This number is a direct measurement of the range and depth of your hygienists’ services.

You’ll see this number in your Manager Report each month. Here is the range of performance we see in our area on the hygiene production per patient visit:

What, theoretically, should the average production per visit be? The next example shows average Metro fees based on average x-ray protocols and average perio per exam.

1110 – Prophy $99.00

0274 – BWX $32.50 ($65 divided by 2 – once per year)

0210 – FMX $17.75 ($142 divided by 8 – once per 4 years, assuming 2 visits per year)

1206 – FL2 $21.50 ($43 divided by 2 – once per year)

TOTAL = $170.75 per visit for basic standard care (If you add in average perio per exam, $20, TOTAL = $190.75 per visit)

As you can see, there is quite a difference between what should/could be and what is ($170 versus $156). Getting this nailed down will add over $2,000 per month to the typical hygienists’ production.

Look at the numbers for your office. As you all know, we abhor quotas. When discussing hygiene production per patient visit, focus on criteria. When are fluorides indicated? What are your criteria for perio treatment? Sealants? Whitening? Talk it over with your team. If they are moving, the numbers will move!

How to Make Collection Calls a Good Experience

(Please pass this on to your office administrator.)

For most office administrators, collection calls would be way down on the list of things they’d like to do! Your whole purpose in practice is to take good care of patients but sometimes unfortunately money becomes an issue.

I make hundreds of collection calls every month and there are a few things I’ve learned. Most patients intend to pay their bills and are actually relieved if you help them find a way to take care of things.

Approach collections positively:

“I am going to call and help the patient” versus “I’m going to call and pressure the patient.”

Of course there is some pressure but it’s best to come right out and ask:

“We have a balance of $250, how would you like to take care of that…?” pause and wait for the patient’s response.

Patients will want to make excuses, so let them vent. You are not asking for excuses—you don’t want to get bogged down into everything going on in their life but if they want to share some of their challenges with you, it’s okay to be a good listener. If you listen to them and show compassion, chances are they will work with you.

Always confirm what you talked about:

“So, if I heard you correctly, we’ve agreed that you will pay $100 now and then $100 by the 5th and another $100 by the 20th. Is that correct? We can count on you for that then, right?”

Sometimes patients won’t follow up on promises or they will be abusive on the phone. Cut them some slack, but if they do not work with you this is a very helpful phrase:

“Mr. Smith, I work in a dental office and our job is to care for people. As long as they are
working with us we’ll work with them to take care of an account. However, if we don’t have cooperation and respect we have no choice but to give this to a professional collector. I’m not a professional collector, I am here to help get your balance taken care of in whatever way we can get this done…”

Have questions? Contact Sheila at 952-921-3360 or APM@advancedpracticemanagement.com.

Delta Games

Toward the end of 2016 Delta of Massachusetts announced that there was going to be a new, for profit Delta. The new Delta will basically offer the Delta PPO schedule only. The better paying (although still discounted) Delta Premier will fade away.

Doctors are told that if they don’t opt-in they will be out of the Delta networks and as the plans turn over, the checks will go to the patients.

For the typical Delta Premier Provider Dentist in Massachusetts this means that Delta write-offs will nearly double. I talked to doctors who will see their write-offs from Delta go from $250,000 per year to nearly half a million. Ouch! Apparently the new “For Profit” Delta will make its profits from squeezing dentists. That is why probably that at the Yankee Meeting, Delta actually had an armed guard at their booth. True!

As you probably know I have written and spoken a lot regarding PPOs. (FYI Dentaltown just released my “PPO Plays” CE: http://www.dentaltown.com/onlinece/category/2/practice-management. I also recently did a podcast with Ben Tuinei at http://advancedpracticemanagement.com/guest-audioseries/.) We are increasingly fielding calls about PPO concerns from dentists all over the country. Minnesota was one of the first to feel the sting of PPO write-offs, audits, etc. Insurance companies basically are creating a race to the bottom with their fees.

Now there are about a half dozen states that no longer offer Delta Premier. For example, if you buy a practice in California it will be considered a new “entity.” Even if you were/are a Premier dentist the practice has to now be on the PPO fee schedule. This affects practice values dramatically since the buyer will not have the same profit profile as the seller.

So the big question on everyone’s mind is . . . Will Delta PPO be the only Delta in the future?

One comfort, of sorts, is that apparently Delta is losing market share. Other insurance companies are taking a bigger cut of the market, so that is why Delta is putting pressure on their provider network. It would be good to see Delta’s “monopoly” diluted.

For many U.S. dentists, Delta is not as big a deal as it is in the Minneapolis/St. Paul area. Delta might be 20- 40% of the national market instead of 60-80%.

What Can You Do About This?

Smart management always puts the time and money where it can get the biggest return. We can do nothing about controlling the insurance market, but we will do all the things we can to make your practice strong so there is less compulsion to sign up for PPOs. Delta is not the only one nicking your bottom line.

As I said in an earlier Bulletin, it’s a matter of the right balance. Most practices will participate in some PPOs, but in my opinion very few practices should participate in all of them! Our research shows that at a certain point, additional PPOs just mean additional discounts, not additional new patient flow.

You have more power than you think. We’ve helped many dental practices successfully balance their PPO participation. If you are writing off over 25% of your production you are working the first 3 months of each year for free! It probably doesn’t have to be that way. Learn more! Contact Bill Rossi at 952- 921-3360 or bill@advancedpracticemanagement.com.

SHOULD YOU ADD ANOTHER OPERATORY?

How Much More Production Do You Need To Justify Equipping Another Room? — Less Than You Think!

As you all know, I am big on “Result Control” as contrasted with Cost Control. As Peter Drucker says, “In business, costs are inevitable. A smart manager focuses on where to put your resources (capital, labor, time, etc.) where you get the best return. That’s ‘Result Control’”.

So what’s the answer?

“10 more Doctor Visits per month – 2-½ per week or 35 Hygiene Visits per month will make adding that room a far better return than anything on the Stock Market!”

Plus the Intangible Benefits of adding another room:

  • Can accommodate more patients during peak times
  • Flexibility
  • Less stress – give you some growth momentum
  • Back up

In Summary: It’s a lot easier to cost justify an additional room than you think it is. Take the money out of the Stock Market and put it into your own business and you’ll get a much better rate of return and better days to boot.

Cost Benefit Decisions in General

We can help you run the numbers on almost anything. Just call.

Open Time? Fear Not!

One of the biggest barriers to practice growth is the Doctor’s fear and loathing of “Open Time” in his/her and the hygienists’ schedule. It causes Doctors to go slow in adding rooms, adding hygiene capacity and taking other measures to ensure practice growth.

Every practice is going to have open time. As long as you schedule humans, it’s inevitable! If you wait to get open time down to less than 7% of your work hours, you’ll never expand capacity to grow!

HOW DOES YOUR OVERHEAD COMPARE?

BerganKDV just released their bi-annual overhead survey. This is best of its kind. It samples privately owned mature area practices. This is the overhead yardstick that you’ll want to use to compare your expenses.

Dental Office Overhead remains around 64% of collections. The typical Dentist netted 36%. The big expense – Gross Wages – is 25.9%. That is very close to the same percentage of two years ago.

Doctors’ average income went from $291,432 to $309,090, a $17,658 increase per year…an annualized change of just under 3% per year. In this two year period, Lab Fees decreased from 6.6% to about 6.0%., probably due to more Cerec, E4D, etc. Supplies decreased from 7.5% to about 6.9%.

The typical practice is spending 2.1% of its revenues on Advertising. Up from 1.7%.

So the average office in the survey spends $18,000 per year in Advertising vs. $14,000 per year in 2014.

It’s interesting to note that according to APM data, the typical practice writes off more than 10 times that amount in a typical year due to PPO discounts. As big a hassle and expense that advertising is, we feel that practices would be better off taking fewer write offs and investing more in practice independence. Investing in Continuing Education and staff training pays off too.

This Overhead survey along with Technology, Fee surveys and much other good stuff is on our website at: AdvancedPracticeManagement.com Our thanks to BerganKDV (www.BerganKDV.com) for this excellent survey.

Tactfully Turning Away Medical Assistance Patients

Many of you are currently not taking new Medical Assistance patients. Still, we all know it can be difficult for these patients to find care and you want to help them.

Call us at APM (952-921-3360) for a list of clinics that are accepting new Medical Assistance patients. There are at least a dozen options for Metro Area Dentists to refer M.A. patients to.

Unfortunately, after extensive calling, we found that for the Outstate Areas, there are not as many options. We did find a few (less than 10 for the entire Outstate Area).

We suggest that your front desk tactfully turn away patients. Instead of saying, “We don’t take M.A., call the customer service number on the back of your card…” (which can really frustrate people). They can instead say,

“Thank you so much for calling. We are not currently able to take on more new patients with your insurance but we can refer you to some nearby clinics. Would you like us to do that?”

We all know that people on Medical Assistance may not be on it the rest of their lives. Also, they may have relatives or friends, so this helps keep things on a positive note for everyone.

Goal Setting

Goal Setting works. Put what you want in writing and see what happens! I’ve enclosed our popular annual format. Share your goals with us. It’s our job to help you reach them.

ECONOMIC TRENDS

GDP growth in the United States was 1.6% last year. Wages in the U.S. were up 2.6%.

Dental Office Wages in Outstate Minnesota were up about 4% for experienced staff in all positions. However, wages for the Metro Area (experienced staff of 8+ years) were virtually flat. Although starting wages for CRDAs were up 7%.

Metro Area fees were up 3.3%. Outstate Area fees were up 5%. The gap between Metro and Outstate fees is gradually closing.

Dentists’ major concern by far is “PPO/Insurance Discounts and Involvement” yet only 5% had dropped a PPO in the last year and only 4% plan on dropping a PPO in the coming year. To me, that doesn’t add up.

51% of Metro Area practices reported being up with 30% being down. 67% of Outstate Minnesota practices were up with 15% being down.

42% of Metro Area practices and 55% of Outstate practices said their new patient numbers were up.

60% of Dentists still charge at the prep despite Delta’s push to have crowns charged at the seating.

Nationally, households are carrying low debt levels relative to their incomes. Household debt is at its lowest point in 50 years, proportionally.

50% of area practices use Digital Communication Software with Lighthouse, RevenueWell and Solution Reach being the leaders.

50% of respondents said they are or have used a Management Consultant. Advanced Practice Management had the highest satisfaction rate (8.7 out of 10) and a greater market share than all other cited firms combined. We are proud of that!

Pre-Election Effect?

I had more than one client tell me that their October was less busy than usual. In fact, one client told me that he looked at the election data going back three Presidential elections and in each of those cases, the fall schedule was lighter but the winter was busy. We’ll see!

THE DENTAL DOW—2016 WRAP-UP

The first half of 2016 was off to a brisk start with a nearly 6% increase in production. The second half wasn’t as strong. For the year, the Production was up 4.1% and Collections were up 3.3%. There was a 2.3% increase in patient traffic. New patients were up just .9%.

Production Increase Percentages

Collection Increase Percentages

 

 

STATE PLANS

If you are confused, you are not alone!

This is a flow chart that Shelly Ryan and Heidi Benson put together to help us and our clients understand the plethora of state-related plans. Call or email if you’d like the more legible “Full sized” version.

SURVEY RESULTS

Area Economic Dental Trends:

“Knowledge is Power” and we are on a mission to make sure you survive and thrive in a marketplace increasingly encroached upon by insurance/PPOs and large scale competition.

Our recent survey shows that PPOs are once again at the top of the list as far as issues you and your colleagues are facing. Yet in the last year, fewer than 5% of area offices actually dropped a PPO.

We are not purists. We feel that every office should have the right balance of PPOs for their area. We often see, though, that doctors are much deeper into PPO participation than they need to be. If you haven’t negotiated with your PPOs, you may be leaving money on the table. If you’re collecting less than 80%, you should seriously look into peeling back PPO participation. We can show you how you can lose the discounts and keep the patients!

Other Trends:

  • Metro Wages remain pretty much the same this year compared to last year. Outstate Wages are up 4%.
  • Digital Communications are now in 50% of the marketplace practices. We’ve seen this to be very handy. Patients like text confirmations. Email blasts help get the word out about the services you provide and help you keep on top of seasonal opportunities (back-to-school, yearend insurance/flex plan notices, etc.).

    The leaders in our area are (in descending order of market share): Lighthouse (33%), RevenueWell (21%) and Solution Reach (12%).

  • Despite the fact that Delta pushes hard on dentists charging at the seat, not the prep appointment, 59% of dentists in our area charge at the prep, 41% at the seat.