Hi Sally,
I am a dental hygienist in North Carolina. First of all, let me say that I absolutely love my job as a hygienist (30+ yrs now) and the practice that employs me, The docs and I have the same goal which is to provide excellent dentistry while fairly compensating me for my over all contribution to the practice. The doctors are good people and I would like to measure up financially both to my own expectations and theirs. We have found conflicting information in our attempts to gather precise details about what is and is not included in the formula that defines the standard 33% compensation. Can you help?

Debbie, RDH

Hi Debbie,

A dentist should pay a hygienist based on what he/she deposits into the checking account from dentistry performed by said hygienist. HOWEVER, it is a bookkeeping nightmare for the front office to track hygiene collections so the industry bases it on hygiene “adjusted” production. Unlike associate dentists who are paid 33% on their collections which is easier to track from a bookkeeping point of view.

If you are making, example $300/day then you have to produce AFTER ADJUSTMENTS – $900/day.
If you produced $900/day and then there was $10 taken off Mrs. Jones for “march of dimes np discount” and $8.00 taken off for “Matthison’s coupon credit, $25 taken off for a “food discount” then your adjusted production for the day was $900 less $43 or production of $857 and $857 is all that the dentist is able to collect and deposit in the checking account to pay you. So your $300 for the day is now 35% and not 33%.

That means tomorrow that your adjusted production would have to equal $943. If it equals $900, the doctor, month to date, is paying you 35 cents out of the dollar and not 33 cents. A dentist is not able to collect any “adjusted” monies and therefore doesn’t have it in the bank account to pay.

However, this is my personal opinion and what I believe to be fair. Hygiene services provided to employees and employee family members is a “benefit” offered by the employer. These services should be charged out as the normal production, adjusted off as an employee benefit, leaving their balance as zero. So, let’s say the normal charges for Carol the receptionist for you to clean her teeth is $125. That employee benefit of $125 is put on the profit and loss under “employee benefit” and you should be given in your production full credit for $125. In other words, the dentist/business pays for any employee benefits not you the employee producer.

Regarding overhead for a general dental practice, employee benefits + payroll taxes ( worker’s compensation, federal unemployment, matching social security) should be no more than 3-5% of the monthly collections.

Now, regarding the discounts for the food store, churd, March of Dimes, etc. These discounts could be viewed and classified as “Charity”. It is the cost of the sale and that cost is going to charity. I do not believe it is fair to take that away from your production.

Items such as phone advertising, hygiene reactivation credit, lifetime bleaching, etc. These discounts could be viewed and classified as “marketing” expense which is a line item on the doctor’s profit and loss and should be no more than 3-5% of collections. It’s not just the cost of running the ad in the phonebook but the discounted amount that you receive as part of the marketing effort.

Now, if the doctor has elected, for example, to be a provider with insurance company X and agreed to be paid a lesser fee than his/her normal fee then that adjusted amount you should be paid on.

It is a personal decision on the part of the dentist/owner whether or not the 33% compensation is just your gross wages or if it includes additional payroll taxes and any benefits paid you. Obviously, these are costs to the business. Some dentists include all compensation as part of the 33% and others do just the gross wages.

I hope this provides some clarity.
Sally

While we go about our daily lives in relative peace here at home, the news reminds us of the tragedy going on in Japan. While I personally don’t know anyone there, I do have an employee, Erin, who has the love of her life on the U. S. S. Ronald Reagan which was 60 miles from the nuclear plant two days ago and now is 100 miles out to sea. I pray for our soldiers safe return.

In the paper this morning, they talked about the fundraising efforts of the Salvation Army that had raised $2M as of Tuesday including $1.9M online, $93K via text and $59K my phone. To contribute $10, text the words “JAPAN” or “QUAKE” TO 80888. Other ways of donating are: calling 800-SAL-ARMY, going to https://donate salvationarmyusa.org or sending mail to the Salvation Army World Service Office, International Relief Fund, P. O. Box 630728, Baltimore, MD 21263-0728. In the memo field write “Japan earthquake relief.”

Heaven forbid that a big one hits here in San Diego someday. But, if it does, I sure hope that someone is there to help us.

Make it a “giving” day,

Sally

After my posting this week on cell phones, I was asked about my opinion about PERFUME! Frankly, I don’t think anyone in a dental practice should wear perfume. I know people who are allergic to perfume and why would we want to take that risk?

But…..ladies and this goes to the men as well. One squirt, that’s it. Not two or three but one squirt. The goal should be that you can’t smell yourself. IF you can smell yourself……you have too much on and it’s not a turn on it’s turn off! Really, you want just a hint so that it faintly crosses someone’s smelling senses enough that they want to get just a little closer to your neck or face. I mean isn’t that the purpose……draw them in?

And you know, too much perfume or aftershave is going to be one of those “sensitive” issues that even your best friends won’t tell you. You know, like body odor. Nope….we’re not gonna’ tell you, we’re just not going to hang around you very long.

So, the moral of this post is: one squirt.

Have a happy day!
Sally

Hi Sally,

Sincerely,
Dr. Rinewald

Hi Dr. Rinewald,

The proper way to handle cell phone and usage in the office is for you as the owner of the business to decide what your policy will be and then insert it as a page in your employee policy manual, call a meeting of all employees, announce the new policy, pass out the page to be inserted into their copy of the policy manual and have them all sign a “new” document stating that they have read and acknowledge all policies in the manual.

I would then ask them if there were any questions and there really shouldn’t be any and meeting is adjourned.

Now, if I owned a dental practice, my policy would be that all cell phones are to be placed in the “central designated” area of the office, which is by the back door, upon arrival and start of their work day. I would install a nice “docking station” that charges it for them. Cell phones would not be able to be on their person nor near their person during the work day. They are allotted breaks during the day and their lunch hour where they can retrieve their cell phones.

Listen, I go back to the days when there were no cell phones and if the assistant’s child was sick or something urgent, then the school or child or spouse called the front office person and the employee was either retrieved or a message was taken.
That should be the policy. My opinion is that it is totally unacceptable for employees to use the time I am paying them for to receive text or email messages. Stealing of time is no different than stealing postage.

I sure hope this helps!

Sally

Dear Sally,

Sheila (wife of Dr. P.)

Hi Sheila,

There are no industry allowances for the discounts that you mention. Those discounts and bad debt write off are two different things.

The decision to offer a 10% or 35% or 55% senior discount is based on your costs of doing business. If the overhead of your practice is 65%, i.e., the costs of running the practice, and 35% is profit, then you hypothetically could not afford to give anymore than a 35% discount to senior citizens because 65 cents on the dollar has to go to cover your costs.

If your credit card processing fee is say 3%, then obviously this cost of providing this to your “customers” is worth it.

This same thing applies to reduced fees that you accept from insurance companies.

I remember consulting with a practice years back that the doctor gave discounts to every police person, every clergy person, every nurse, doctor, etc.
While he thought his fee for a crown was (back then) $750, with all those discounts he was getting $510 per crown. Once he saw how little he was getting, he stopped giving price breaks to everyone that walked in the door.

Let me know if you still have questions.
Sally