Is Your Practice Infected?
Dr. Jeramy Close – Case Study #211
Do you find yourself looking at your business bank balance and wondering where all the money is? You are busy, the business team is on their toes and you have the best clinical team in town. What is the problem? You have no idea where to even start to perform your due diligence. Dr. Close called us with this very concern. On the surface, his practice appeared to be healthy and successful. However, his financial statement was not reflecting the same health. How could he learn what disease the practice was suffering from and what was the cure?
Where To Start?
I arrived at Dr. Close’s beautifully landscaped office first thing Monday morning. I was armed with my magnifying glass, my calculator and 30 years of experience in detecting the source of a practice’s financial disease. His business team was more than helpful in escorting me to a quiet area equipped with a computer holding the practice software and a ream of paper. I began my search.
Where Is The Disease Contracted?
Patient ledgers were maintained by the use of a “3-way” posting system, using a day-sheet, carbon paper, a ledger and a receipt. Statements were generated by making copies of the ledgers in the copy machine and mailed in window envelopes. It was extremely time consuming to determine the total Accounts Receivables, let alone the ratio of the A/R compared to the net production. Unfortunately for many team members, many of these protocols are still in place, in spite of the fact that the results can easily be obtained utilizing the software. As a result, there are many system failures that go undetected.
In Dr. Close’s case, he had no idea what his Accounts Receivables were, whether or not the insurance claims were being paid or if statements were being generated and how. As far as he knew, post cards were being sent to his recall patients but he hasn’t seen any of them since he stopped selecting them himself 15 years ago.
What to Look for:
At an average of $123 per hygiene appointment and not including the exams, this is a loss of $51,783. There is a good chance that this bleeding has been occurring over the past several years as the practice aged.
How to Establish a Cure?
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