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?
Some of the things that I am not sure should be included into the calculations are:
Production adjustments– staff and family discounts (how deep does this family discount go–employees get dentistry free for ourselves and those family members living under our roof, march of dimes new pt discount promotion, Matthison’s coupon credit, Blue book (phone book advertising) Hygiene reactivation credit ($25.00 coupon to try to get existing pts back for hygiene visit) Letter with coupon($amt?)) to get exisiting pts. back into office, Church Toys for Tots promotion (discount), Internet coupon, Lifetime bleaching coupon, Food discount———-ARE SOME OF THESE THE COST OF DOING BUSINESS AND NOT REFLECTIVE AS TO WHAT THE HYGIENIST IS ACTUALLY PRODUCING? What about bartering situations?
Sally–I want to make myself perfectly clear here, I am NOT looking for a raise or bonus. I am looking to determine exactly what I should be producing for this practice so I can feel like I am pulling my weight.
Thank you for your knowledge in advance. I trust your experience in this area.
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.