Your Production Is Down and So Are You!
My schedule is full and I am busy, but at the end of the month I am lucky to break even. What is wrong with this picture?
Dear Dr. Shortnsorry,
There are several practice systems that affect the profitability of the practice. Have you delegated tasks to licensed dental assistants to free up some time on your schedule for productive services? Doctors who continue to fabricate their own temporary restorations lose about an hour or more out of every day that could be spent producing more billable dentistry. How much time do you spend in casual conversation with patients? Of course it is good to connect and share a little sports news, car bragging and child news, but when it causes you to run over or alter a patient’s treatment plan to get finished on time, you have lost production.
Are procedures scheduled according to the actual chair time required? If you find yourself with time to surf the net, perhaps a clinical time and motion study is in order to become more efficient in procedure times. If you are running over every day for some procedures and patients are left waiting in the treatment rooms while you try to catch up, you may want to reschedule procedures that were planned for that day.
Are your treatment rooms set up to allow for easy and quick access to materials and supplies you use daily? If not, your assistant will be running back and forth to retrieve instruments and supplies from the sterilization area, supply storage or the other treatment rooms - causing you to lose time at the chair.
How about your overhead management? Are costs out of control for dental lab and dental supply costs? Out of control overhead can cause the productivity of your practice to fall short of the goal because you are spending more than you are making. Don’t know if you have healthy statistics? Call McKenzie Management and talk to a consultant who can give you information on the standard overhead costs of a dental practice.
If you haven’t raised your fees each year for fear of scaring patients away, that could account for production goals falling short. Have a fee analysis completed to find where your UCR fees fall in your demographic. If they are low for the area, then raise them to be competitive in your neighborhood. Most people do not shop around for cheaper fees if they feel you are fair and bring value to the services that you provide. It’s about trust, not fees.
Discounting fees is a way to make you feel like you are making your services more affordable to your patients who want care, but struggle to pay for it. This is wrong thinking and detrimental to the profits of the practice, unless you have a margin of profit after the discount. If you internalize that your fees are too high and you feel sorry for your patients, it will result in poor treatment acceptance because patients will sense that perhaps you aren’t fair or that your services are below par to other dentists in the area. If your fees are middle to low for the area and you give discounts on top of this, you may be giving your services away. The same applies to daily no-charge visits to patients for viable billable visits. The patient may or may not appreciate the gesture, and may develop a sense of entitlement and expect no charge visits each time they come in for adjustments or limited evaluation appointments.
If you schedule without consideration for hygiene exams, you may be passing up the opportunity to present treatment again to a patient that just might buy it. Studies show that 65-85% of your repeat dental business comes from the hygiene department, so make sure you do the exam sometime within the hour that the hygienist has the patient in the dental chair.
Lastly, consider the adjusted production/collections that are necessary for being a preferred provider on the PPO network. Because this is discounted dentistry, it is imperative that you collect co-pays and deductibles at the time of service and carefully manage your schedule for efficiency.
Carefully monitoring these systems and making the right changes will result in higher production and collections every month.
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