Category Archives: Dental Practice Management

Digital Communications: What Is It? What Good Is It?

(E.G., LIGHTHOUSE, REVENUEWELL, DEMANDFORCE, SOLUTION REACH, ETC.)

Use of this technology in dental offices has almost doubled in the last three years. 38% of area dentists now have it.

If you haven’t got it, you’re probably looking into it and it is worthwhile to look into.
If you have it, chances are you’re not using it to its full capabilities. That’s worth looking into.

Contrary to what the sales representative will tell you, Digital Communication is not an all-purpose cure to cancellations and failures. It can help keep a practice busier but we cannot prove yet that it reduces no-shows. We do know, however, that it frees up front desk time and we also know that clients have benefitted from its many applications:

Patients really like text and email confirmations—it’s part of showing people you
are keeping up with technology.
This gives your front desk team more time to make appointments because they spend less time confirming them.
It gives you the capability of getting surveys from patients, which is good feedback but, as importantly, can help you get more testimonials for your website online reviews. We know that testimonials are important conversion factors for converting website visitors into patients. Think of your own behavior when you shop for hotels and how you look at reviews.
Promote services such as Invisalign: Example: a client of ours from Rochester used an email and text announcement to promote their “Invisalign Day”. They feel that this was responsible for 15 patient Invisalign starts.
Fill last minute openings: Examples: A client in Wisconsin emails patients (RevenueWell) when they have last-minute openings in the hygiene schedule. They offer whitening (bite-down trays from Patterson) to the first person to respond and fill the appointment. “Last minute openings. Come out and get that checkup you’ve been putting off and you’ll get free professional-strength whitening…” Another client in Houston, TX uses digital email and texting (Demand Force) to announce last minute openings in their hygiene schedule. Their incentive is free movie tickets. They said some patients actually wait to schedule when they know they can get free movie tickets. Not all bad because it means that there are a lot of patients eagerly standing by to fill last-minute openings. You should not overdo it, but if you even do this once or twice a month to fill 2-8 hygiene slots as a result, it is a pretty good payoff.

There are many applications for digital communications and they’re growing! My associate, Kelly Larson stays on top of the constant changes and keeps a summary grid of the various digital communication companies to help you compare their offerings. Generally, they charge about $300/mo. Most arrangements are month-to-month (companies are no longer asking for one or two year contracts).

Dealing With Patient Complaints: An Opportunity In Disguise

(Dentists, Please Share This With Your Teams)

dealing with patient complaints

We’ve written before about how getting positive online reviews can enhance web presence and is a strong “conversion factor” that turns website visitors into patients. With patients being able to complain online as well, we have a double-edged sword. A negative complaint can be seen by who knows how many people! Dealing with negative online reviews is a whole discussion in itself.

This article focuses on dealing with face-to-face patient complaints. However, if you get a negative online review, you can sometimes call that patient and use this same process. We’ve seen situations where the patient has taken the negative review down once their complaint was satisfied.

Naturally, if complaints are handled wrong, you can lose patients. More importantly, patients that complain are also more likely to be loyal patients and refer others if the complaint is handled well. If someone is dissatisfied they will probably tell others. I have heard over the years many different statistics on this, but you can assume for every complaint you hear there are other people who hear or voice the same complaint. Complaints are sort of your “canary in a coal mine” for patient relations.

Our statistics show that the typical dental practice loses about 12% of its patients per year. Probably about half of those lost are due to something the Doctor or staff did. The other half are due to factors beyond the practice’s control, like the patient moving or insurance changes.

Remember this six step process:
1) Prepare
2) Listen
3) Build Rapport
4) Develop A Solution
5) Confirm & Close
6) Follow Through

1) Prepare

Maintain an alert and upright posture. Pen in hand. Be ready to listen with an Adult state of mind.

Child (emotional)
Parent (judgmental and rigid)
Adult (rational and solution-seeking)

When a complainer calls, they are in an emotional (child) state. They may have rehearsed a speech in their mind. They feel abused, cheated, or uncared for. Therefore, the person hearing the “child” may unconsciously start adopting a parent state. That’s when you’ll hear things like “Our policy is…”; “You should have…”; “You don’t know what you’re talking about…”; “It’s your responsibility to know your insurance, etc.” By keeping an adult state of mind, you let the child vent then, eventually, through your own behavior, they will start to come to the adult state.

2) Listen

Take notes. Acknowledge that you are hearing; “Tell me more.”; “Then what happened?”; “I see.”; “I understand that could be very distressing.”

3) Rapport

Use the patient’s name. State your purpose, “I want to find a solution you are happy with.”; or “I’ll help you get to the bottom of this.”; or “We certainly want to do everything we can to make this right for you.” Restate the person’s complaint. “I’ve taken notes and what I heard you tell me was… Do I have that right?”

4) Solution

“Here are a couple of things we may want to consider.”; “Would it help if I found out about _____ for you?” And, of course, “What would you like to have done so we can resolve this?”

5) Confirm & Close

“So here’s what I am going to do.” (find out, fix, or make sure “it doesn’t happen again”). “How does that sound to you?” Make sure that you note any specific actions and timeline and who’s going to do what by when.

6) Follow Through!

Make very sure you follow up on your promises. Example: “Your fees are too high!” A typical response (usually proposed by consultants and dental journal writers) is, “Mrs. Jones, we only use the finest materials and for the quality of care we deliver, blah blah blah.” Or, “Dentistry is inexpensive when you compare it to medical or buying suits or some other things (that are implied to be less important, thus indirectly putting the
patient down.)

Instead: “Gosh, I can tell you are unhappy with this. Can you tell me more?”
“Well, Bill, it’s my job to help ensure that you are happy with our services. You obviously
feel our fees are high and I’d like your suggestions on how we can go about looking at this.”

The patient might feel the fees are high because they can’t afford things in which case, of course, you work with financial arrangements. They might feel they are higher compared to other offices in which case you might say, “Would you like us to check our
fees against other offices or show you what information we have about that?” Or, in many cases, the patient just may want to be acknowledged and they don’t really want you to do anything except understand them. If the fees are indeed high even compared to other offices, then you can explain why. “Our fees are a little higher than average and I wanted to explain to you why they are if that’s what you’d like me to do.” Then (and only then) you could go into things about the quality of the lab, the time the Doctor spends, the Continuing Ed or technology, and so on.

In Conclusion:

No one likes to hear complaints, but dealing with them tactfully is a critical “customer service” skill.

The Dental Dow Jones – 1st Quarter 2015

2015 OFF TO A GOOD START!

dental dow first quarter is up For the mature area practices sampled, practice production was up 6.1% and collections were up 6.7% compared to the first quarter of 2014. This is the most growth in these indices since 2004.

Patient flow was up 5.1% with new patients up over 10%. Again, the most significant jump in patient flow we’ve seen in years.

One quarter doesn’t a year make but this is certainly good news. It’s also nice to see that downtime in the Doctors’ schedules is down 11% and in the hygiene schedules down 6.5%.

Associate Interview Suggestions

Locating and signing a good associate is an important process. There are few other relationships that can have more impact on your life (your professional life for sure). I have seen many smart Dentists stumble in this process and lose a good potential associate. Or worse, not do a complete enough interview and be stuck in a “Bad Marriage”. So, I’ve developed a brief list of suggestions.

General Approach: Ask the associate what their long and short term goals are. Get a picture of what their picture is. Then, share your “pictures.”

In this way, you can see if both your expectations match by focusing on the positive aspects of getting together. This will help you work through anything that may be a problem or barrier.

Only once you’ve “shared pictures” should you then get down to specifics to do with associate compensation percentages, benefits, and other nitty gritty details.

Finding the right associate is a sort of courtship process. You don’t want to bring out the “prenup” too quickly. If legal details are brought up too soon, that can make things a contest. In fact, you do not want to prepare an associate contract until you are pretty much decided that you both want to practice together. Go for the handshake first, the lawyers second.

Sample Questions To Ask An Associate Candidate

Long-Term Questions:

What are your long term/big picture goals?
How much would you like to make?
How much would you like to work?
What kind of dentistry do you like to do?
What kind of technology is important to you?
What would be your ideal work week?
How much vacation time will you want?
“Tell me about yourself” (family, hobbies…you just want to see if the associate will reveal themselves to you).
How involved would you like to be in leading the staff?
Do you have any particular areas of administrative or clinical interests that you’d like to help our practice with?
Is practice ownership important to you? If so, what sort of timeline do you have in mind?
Are you working with any particular advisors or accountants?
What other opportunities are you looking at?
How does my opportunity rank with your other opportunities?
What sort of dental experience do you have (if there are other offices that they’ve associated with or worked in). What did you like or not like about those experiences?
What are the very most important things that you are looking for in a place to practice?

You can sometimes agree to disagree. You don’t have to see everything exactly the same way. One of the benefits of having an associate is to have someone who sees things differently than you do or has different interests.

Short-Term Questions:

What would you like to see happen in the coming year regarding (things like the above, hours worked, visits and so on).
What sort of compensation did you have in mind?
Would you be willing to work evenings, Fridays or Saturday hours?
Are you willing to be “on call” on weekends?
Are you O.K. with occasionally doing prophies?

Clinically-Related Questions:

What is your opinion on amalgams vs. composites?
What conditions, in your opinion, warrant the recommendation of a crown?
When are implants indicated?
What are your thoughts regarding ortho?
How much time do you like to have for a crown prep? Seating?
Are you into Cad Cam (Cerec)?

In summary, the best associate interview is a dialogue. A conversation. After the interview, make notes as to what the associate said was important. Chances are you’ll need more than one interview to really sort out how compatible you are. It also makes sense to have the candidate spend as much time as possible in the office observing. In fact, their willingness to take time to come and observe is an important sign of their interest and commitment.

PPOs & Practice Transitions

As published in The Profitable Dentist, Summer 2015

One has to consider many factors when purchasing a practice and now PPO participation has to be taken into account. This becomes even more important when you’re dealing with practice mergers. It is increasingly common to see exiting practices not sold outright but sold to and blended with another practice. I have worked with many of my clients through this merger process and have described below some scenarios to illustrate the high stakes involved.

Example: A practice purchases another practice that’s participating in a large PPO that the purchasing practice isn’t. Does the buyer join that PPO for the sake of having a smoother transition?

Continuing with this example, let’s say you’re a Delta Premier provider. In many parts of the country, patients with Delta Dental insurance have the option of going to a Delta Premier provider and getting that level of benefits or going to a Delta PPO provider where they have the incentive of even further reduced co-payments.

If you are a Delta Premier Provider (the “Regular Delta” – not with Delta PPO) and you buy a practice that’s with Delta PPO, those patients will experience a transition as they blend into your practice. This has to be handled tactfully or the patients whom you are assuming the care of will bounce out of the practice. On the other hand, if you join Delta PPO and have a lot of regular Delta Premier patients, you will experience steeper discounts on patients you already have. This can be terrifically expensive, even more expensive than the actual practice purchase in some cases.

Even worse is going into the situation without knowing what PPOs in which each practice participates. Sometimes the owners of a practice don’t even know for which plans they are providers. This is particularly true with PPO networks like Dentemax, Connection, DHA and others that include multiple insurance companies. For example, you may be contracted directly with MetLife or you might be indirectly contracted through one of these PPO network groups.

If you’re purchasing a practice that has a lot more PPO participation than you do, you and your staff have to be ready to take these patients through transition (much as if you were leaving a PPO). However, this is more delicate because you don’t have patient loyalty working for you (yet). On the other hand, when you purchase another practice, you’re “topping off” yours, and it puts you in a better position to dump PPOs and take some patient loss. As you can see, all this can be quite complex.

Another scenario: The practice you’re purchasing participates with the same PPOs. Okay, but you want to compare both practices’ PPO fee schedules. PPOs do pay different doctors differently! The practice you’re purchasing might be getting better reimbursements on the same PPO than you are (or vice versa). Obviously, you would want to negotiate with the PPO (if you’re going to participate) to ensure that you get the better fee schedule of the two for continued participation, even if you are bringing the selling doctor over.

If you’re not doing a merger but an outright practice purchase, it’s very important to get a specific list of all the PPOs the selling doctor is participating with and the fee schedules. Of course, you want to look at all practice write-offs too. Some practices don’t do a good job of itemizing the write-offs so it’s hard to track how many are due to the various PPOs.

Before purchasing a practice, you may want to call the relevant PPOs and negotiate the fee schedules in advance. If you’ve gone ahead and purchased a practice, you have an opportunity very early in the credentialing process to negotiate. PPOs tend to be a bit more willing to negotiate before you sign up.

A practice purchase can be a great way to go. It offers a much quicker start or move in your career than building from a scratch. There is less risk and more predictability.

Practice mergers can be the best deal in dentistry. If the conditions are right, practice mergers are THE very best way to build your practice. This typically consists of absorbing an older doctor’s practice into yours with, perhaps, the older doctor working in your practice for a while through the transition phase.

In conclusion, If you are buying a practice (outright or in a merger), the right “PPO Plays” can make many, many thousands of dollars difference to your bottom line. No smart buyer will overlook the PPO situation.

Bill Rossi is president of Advanced Practice Management. He and his associates are actively involved in the ongoing management of over 250 Upper Midwest dental offices. You may contact Bill at 952-921-3360 or through www.AdvancedPracticeManagement.com.

The Dental Dow Jones – 1st Quarter 2015

Off To A Good Start!

For the mature area practices sampled, practice production was up 6.1% and collections were up 6.7% compared to the first quarter of 2014. This is the most growth in these indices since 2004.

Patient flow was up 5.1% with new patients up over 10%. Again, the most significant jump in patient flow we’ve seen in years.

One quarter doesn’t a year make but this is certainly good news. It’s also nice to see that downtime in the Doctors’ schedules is down 11% and in the hygiene schedules down 6.5%.

D0150 Comprehensive Evaluation VS. D0180 Comprehensive Perio Evaluation

We all know about D0150 Comprehensive Evaluation for New Patients. In certain instances, utilizing Code D0180 Comprehensive Periodontal Evaluation might be in your best interest.

This code came out initially for utilization by specialists. Both codes 0150 and 0180 are Comprehensive Oral Evaluations for new and established patients. The difference being 0180 is used exclusively for patients showing signs or symptoms of periodontal disease and with patients with risk factors, such as smoking or diabetes. D0180 requires complete periodontal charting, which includes, but is not necessarily limited to 6 points per tooth, probing, recording recession, furcations, bleeding points, mobility, attachment loss and a periodontal diagnosis. The 0150 may include a periodontal screening and list of any soft tissue anomalies but does not require any recording. That being said, many patients do meet this requirement both as new and/or re-establishing patients.

Most insurance carriers treat the 0180 similarly to the 0150 in that it counts towards one of the two exams that are typically paid per year, although some variations have been noted. Some carriers may reimburse D0180 every 12-24 months or every 3-5 years and some once in a lifetime. Some insurance carriers compensate at a higher rate for the D0180 vs. the 0150. So, this code can be helpful and is being used more and more by general practitioners.

Questions About Dental Codes?

We are happy to help. Call the team at Advanced Practice Management at (952) 921-3360.

Good Golly, Do Your Goals!

You hear it from me every year because I see it work every year! Doctors with written practice goals, team participation in setting the goals and good management support do better every year. It’s almost spooky it works so well.

So, do yourself a favor. Sit down with the Goal Worksheet (see below) for 30 minutes to an hour. Be realistic and optimistic. Be true to what you really want. Maybe more money may not be as important to you as more time off or a happier, more harmonious workplace. Describe in writing your perfect practice!

How good can you stand it?!

Click on this link to download your goal setting worksheet:
YOUR 2015 GOALS

Doctor, What Is Your Practice’s Regeneration Rate?

(Statistical Snapshot from APM’s Database):

Presumably, the bigger a practice’s Active Patient base is, the more referrals it will generate per year.

More people saying good stuff about you. Also, the bigger your practice is, the more new patients it needs to replenish itself. Through normal attrition, a practice with 2,000 patients will lose more per year than one with 1,000.

We measure a practice’s regeneration rate by dividing the total number of new patients per year by the active patient count.

For the average practice in our database, the regeneration ratio is about 11% per year. Strong patient flow growth is usually indicated by a ratio of 20% or more.

If your practice has a low regeneration rate, it’s very likely that your practice will shrink over time. Our analysis of the “average lifetime” of a patient in a practice is about 9 years, which, coincidentally or not, matches up pretty closely with the average replenishment rate.

Replenishment rates in our data base range from about 4% to over 30%. As with most statistics, we use them to just help frame an issue. When we are managing a practice, we are looking for the movement of the numbers—the statistical trends are more important than just the reading.

Want To Know Your Regeneration Rate? Your consultant can assist you in getting an updated Active Patient Count (2-year criteria), calculating your ratio and interpreting the results.

If you want to refine things further and you’ve been tracking new patient sources closely, you can look at your pure “referral ratio”, which would be a reading on the number of referrals you get per 100 active patients per year.

Speaking of Referrals: If you go with the general assumption that about 1 out of 10 patients refer you to another in a given year, then ask yourself, “What would happen with practice growth if I could just get 2 or 3 out of 10 patients to send another patient in per year?”

Dental Office Overhead Statistical Trends

KDV* recently released their bi-annual overhead survey for general practitioners. It’s the best of its kind for our area and it’s quite useful in analyzing expenses and setting budgets. Their last overhead survey was done in 2012. Since then, dental office overhead has remained right around 65% of collections (in 2012, 64.7%). The typical GP practice in this survey of mature area offices collects about $69,000 per month and nets about $290,000 per year (before taxes). In the 2012 survey, the average monthly collections were $65,000 with a net of about $272,000.

Over 45% of dental office overhead is staff wages. Gross wages come to about 26.9% of collections, up slightly from the previous survey. Including benefits, staff costs are about 31%.

Since staff costs are your major controllable expense, it’s a very important area to focus on “Result Control” (not just “Cost Control”).

This is the time of year where many Doctors are looking at staff compensation. According to our recent survey, about 40% of Metro area practices and 56% of Outstate area practices have, or planned on, giving.

We recommend these three criteria:

Market Rates: Regardless of “costs”, you have to meet the market to attract and keep good staff. For example, nowadays, assistants are in higher demand, especially in Outstate areas, so they can command higher wages.
Practice Growth and Profitability: The way I look at it, the staff’s slice of the pie is about 25% of collections. I recommend that each year our clients compare their gross wages to collections to see if that percentage is increasing or decreasing in their practice. Of course, the object of the game is to not have the staff salaries as a percentage of collections grow faster than the practice. However, if you have good practice growth, it’s likely the staff salaries have decreased as a percentage of collections, thus giving you more potential to award raises for those that deserve it (see below).
Merit: Individual performance and contribution to the team effort. So the market rate sets the base floor of pay. The practice’s growth and staff salaries give you a budget and individual merit helps you decide how to allocate those dollars.

Would you like our help in setting up a budget for 2015? Just ask your APM consultant! Call (952) 921-3360. We’d be happy to help!

*KDV is an area Accounting, Payroll and Wealth Management firm that works with over 100 area dentists (www.KDV.com)

More On Overhead Trends

Lab costs have decreased from 7.1% to 6.6 % of collections. This is most likely due to more offices with CAD/CAM technology (CEREC/E4D). At the same time, “Professional Supplies” are up slightly from 7.2% to 7.5%.

Professional banking and other fees are up from 2.2% to 2.4%. More patients using credit cards means more bank charges (more about that in another issue). Professional fees, including consulting and accounting, should be under 2-½%.

A quick pitch here: our fees typically come to less than 1% of our clients’ gross production and rarely over 2%. We feel that with a little help from your friends (us!) you get way more than that in return through leveraging your and your staff’s time and talents with good business practices.

Surprisingly, the advertising percentage has not really increased. It’s around 1.7% of collections. Given the typical practice writes off well over 10% of its production due to PPO discounts, I would think that more Doctors would be spending more money on advertising to enable them to cut back a bit on PPO participation and the serious discounts and expense incurred. So, for example, if you’re collecting less than 80% of your production (and I can’t believe I am saying this—there used to be a time when no one collected less than 80%!), you probably are participating in more PPO’s than you need to. Ironically, the Doctors in the best position to peel off PPO participation are the ones that are temperamentally less inclined to do so. There are few decisions in your practice that have more potential risks and rewards than those to do with PPO participation, so please make use of our expertise in this area. We have made or saved many Doctors many $1,000’s.

Incentives and Budgets: About 33% of practices have a staff bonus/incentive plan. On a scale of 1-10, the Doctors with these plans rated them at “7”. I’ve seen incentive plans work miracles. I’ve seen them fall flat or eventually fizzle out.

Good incentive plans have to be tied in with a good business plan. The staff has to know how they can win and what each individual has to do to contribute to the practice’s growth. Just setting a production or collection target with no concrete ways to get there is a sure way to frustrate the team.

Mathematically, all the incentives we recommend are in light of the above overhead statistics so that the more incentive you’re paying, the better your ratios are getting. Everybody wins.

If you’d like our assistance in setting up an incentive program, let us know. If you already have an incentive program, please check with us at least once a year so that we can make any necessary adjustments. All incentive programs need to be tuned at least annually.

Other Trends

Some highlights from our recent Fee/Wage/Technology and Insurance Participation Surveys:

Digital Communications – (Demand Force, Lighthouse, Smile Reminder, RevenueWell, etc.) continue to come on very strongly. 38% of practices now use this. Just a few years ago, it was under 10%. Like any other kind of software, signing up is just the first step—we can help your team get the most out of it. Digital communication technology should turn into freed up staff time, perhaps reduced cancellations, increased recall visits, more reviews, more patient testimonials and more production!
21% of general practices now offer Invisalign, Clear Correct or other orthodontic treatment. 34% use laser caries detection (e.g. Diagnodent), 7% are using digital impression scanners and 73% of offices have digital radiography. (By the way, that means 27% of offices don’t; thus, we do not feel there is any huge urgency to convert to completely electronic health records. We don’t see any evidence of any Government Agency pushing hard to enforce that. So, by all means, move to electronic health records but don’t do it out of some fear of government deadline or some jive sales talk).
43% of offices said they were chartless with 72% having terminals in the treatment rooms, which, of course, correlates very closely with digital radiography (73%).
50% of hygienists now use magnifying loupes.
78% of offices have websites and 38% have mobile websites.
6% of offices reported they have Cone Beam Imaging. The average fee charged is $300.

PPO/Insurance Participation: PPO participation and write offs continue to dig in. Participation with Delta Premier (87%) and Delta PPO (30%) remains about the same as last year. 7% of Doctors reported they had dropped participation in a PPO in the last 12 months and 4% plan on dropping a PPO in the coming months. However, 12% have joined a PPO network in the last 12 months.

Again, if you’re considering joining or dropping a PPO, please check with us first.

Your Top Issues

In descending order, Dentists’ top issues are:

Insurance PPO/Third Party Write
Production, growth, filling schedules,
Attracting new patients, marketing
Staff issues, motivation, teamwork and costs
Technology, keeping up, costs, going

Fees

Metro Area fees were up 2.4%. Outstate Area fees were up 3.2%. Wages were up about 1.8%.

Our Website Is Your Tool Chest

We have detailed Overhead, Technology, Wage, Fee and Benefit Surveys on our website. Plus, numerous Bulletins, articles and interviews that address a wide range of subjects.

We are your source for reliable, practical information. In a world full of big insurance companies, corporate dentistry and governmental complications, we are the pros that are on your side. That is, the Doctors who are and want to continue to practice independently, deliver top-notch service to patients, take good care of their staff and earn a good living doing good!

Photo Credit: Dollar Photo Club