7 Reasons Dental Offices Donít Achieve Success
By Belle DuCharme, CDPMA
Working as an instructor of dental business systems, frustration mounts when solutions to help solve the many problems that can arise in a dental business are dismissed. I often hear “that won’t work in my office” followed by many negatives to justify this train of thought. Unfortunately for dental practice ownership, the number of loan defaults have risen from .4% (about 20 years ago) to as high as 5% recently. Struggling doctors give many reasons for this, yet down the street in the same demographic there are dentists with dream practices. How is this possible?
No two dental practices are the same, yet we see many of the same issues and challenges in all of the offices we work with. The following are the seven most critical areas holding dental practices back from reaching their potential.
1. Fear of Fees
Many dentists are afraid of losing patients due to the cost of purchasing dentistry. I say, “Don’t diagnose the pocketbook of your patients.” I have heard countless stories of patients purchasing high-end dentistry from another practice because they weren’t presented the best option for care by their dentist. Have your fees professionally analyzed to determine whether you are UCR (Usual, Customary and Reasonable) for your practice demographic radius. Don’t give discounts if your fees are less than the 80th percentile, because you can’t afford to.
2. Poor Management of Working Capital
You can’t spend more than you can generate while depleting the reserve balance. Every business needs a safety net. Work out an overhead budget with your consultant or accountant and stick to it.
3. Fear of Competition
Fearing the other practitioners in your area will result in lower treatment acceptance because the dentist equates an optimum treatment plan with the patient “shopping” or getting a second opinion. Embrace the competition by finding out what they don’t provide in your demographic, and then provide it. For instance, a start-up dentist planning to treat all ages opens a practice next door to an established popular dentist. His thought is, “How am I going to get patients when this dentist has a firm hold in the community?” Inquiring about the services offered in the established practice reveals that they do not accept children under the age of 18. A solid marketing plan then provides plenty of young patients to get the new practice up and going.
4. Low New Patient Numbers and Retention
Both of these numbers are measurable by the practice management software and are critical for growth and maintenance of cash flow. What is the number one source of referrals in your practice? It may not be what you think. Take that source and build it to attract more patients. Survey your patients using a patient management system in your software for feedback on customer service. Dentrix and Eaglesoft both have survey systems. If your demographic has many dentists doing about the same, you will need to “brand” your practice to become visible and unique. A full service marketing company that caters to dentists can help you succeed.
5. Lack of Written Financial Agreements with Patients
Back to the fear of fees. Patients want and need to know what you expect from them regarding payment for services rendered. Offer a 5% reduction in the total fee if pre-paid. Use third party lenders such as CareCredit and have the information available at the presentation. Most people need to make payments, but the dental office is not a lender nor can it monitor a patient’s credit worthiness. If you are accepting assignment of benefits from insurance companies, be sure to include the estimate in the financial agreement. Always collect estimated co-payments and applicable deductibles to insure cash flow to cover ongoing expenses.
6. Poor Customer Service = Poor Patient Retention
This is not new. No one returns to a business if they were treated like they weren’t important. Analyze what your patient experiences with the first call to your office. When a patient shows up for the first time, are they greeted like guests in your home or like interruptions? Dentists – stick your head out of the treatment room and listen daily. If you aren’t satisfied with what you hear, now is the time to train your team. Don’t tolerate poor service in the hopes it will get better, because it won’t.
7. Not Tracking the Practice Revenue
When you don’t look at the daily, monthly and yearly reports generated by your practice, you are disconnected. The Accounts Receivable Report shows how much is owed to you. If your 90-day aging amount is more than 10%, something is wrong with collections or you have outstanding unpaid insurance claims that need follow-up.
Need help? Call McKenzie Management today and get the prescription for a successful practice.
If you would like more information on McKenzie Management’sTraining Programs to improve the performance of your team, email email@example.com
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