Avoid the “Missile-aneous” Budget Explosion

Sally Mckenzie, CMC
President
McKenzie Management
sallymck@
mckenziemgmt.com

      When it comes to miscellaneous expenses, this line item is often a giant missile aimed right at your rosy revenue picture. All those rinky-dink nickel and dime costs individually appear to be insignificant pocket change. But once the trigger is pulled … “Doctor, where should I put this expense? Oh, I dunno. Just stick it in miscellaneous.” … It’s just a matter of time before a giant “missile-aneous” sized hole is blasted into your budget.

According to industry standards miscellaneous items should account for no more than 10% of the practice budget. In reality, it often runs as high as 15% of monthly collections. If you’re nodding your head and saying to yourself, “Well I KNOW my miscellaneous costs are well within industry parameters,” consider this, practices frequently will have several small budget line items - .48% here for professional dues, 1.2% there for accounting, 1.7% for attorney fees. All of those are miscellaneous expenses, but they are not designated as such. They have been given their own individual budget line items causing the miscellaneous expenses to appear lower than they actually are. And because of their seemingly small numbers those individual items are hardly given a second glance. Little do you realize that all those itty bitty expenses are likely to cause your miscellaneous budget to explode into the 15% range.

Then there is the matter of running the correct reports. Because the individual responsible for managing virtually every dime of practice revenues is seldom properly trained or given necessary reference manuals, they do not know how to run the correct reports. For example, miscellaneous expenses are commonly shown only as a total dollar amount on the profit and loss statement and not as a percentage of practice revenue, which gives the doctor no real information regarding exactly what percentage of practice revenues are being “nickel and dimed” away.

Make it a point to take a close look at all those seemingly insignificant expenses starting with malpractice insurance premiums. Doctors frequently will just make the payment with little thought and no effort to shop around for a more affordable plan. The same holds true with hospitalization, business, and overhead insurance. Check out your accountant’s fees as well. Are you paying a $300-$500 retainer for outdated, vague financial reports or are you actually receiving accounting services and a clear understanding of your practice revenues for the bill you are paying each month.

No question, many of the items that fall under miscellaneous expenses are completely necessary and unavoidable such as professional fees, telephone services, etc. Nonetheless, ask questions, pay attention to the grand total on all those little percentages, make sure the financial reports you are reviewing are giving you the complete picture, and you’ll be much better prepared to avoid a giant “missile-aneous” hole in your budget.

If you have any questions or comments, please email Sally McKenzie at sallymck@mckenziemgmt.com.

Interested in having Sally speak to your dental society or study club?
Click here

Tech Tips For Today!

Designed to improve management techniques through your technology platform

Mark Dilatush
VP Professional Relations
McKenzie Management
mark@
mckenziemgmt.com

      Last week, [see article], I discussed the pharmacy database in your practice management software and ways to use this area to expand your service level to your patients.

This week, let’s stay on the topic of doing the “little things” with your software to enhance the customer service experience. These are primarily operational customer service techniques done when you utilize some of your software’s otherwise “hidden” features.

“My software is broken! It won’t estimate properly! It is driving me crazy!”

Wow, I wish I had a nickel for every time I heard this one. Estimating insurance and patient co-payment amounts are definitely “service centric” in an office that accepts assignment or participates with insurance plans. This topic was generated by an e-Motivator newsletter reader.

Rule #1
It’s your fault! Yes, that’s right. I said it. It is your fault your practice management software is not estimating properly. I say this as a direct challenge so you have the motivation to follow the following steps to find out where you’re going wrong.

Overview – (coverage tables/bluebooks)
Most (if not all) of the practice management software has something called “coverage tables” or “bluebook information” in their software. This is where you enter the exact insurance payment for each ADA code when posting insurance checks. Your practice management software uses this information to estimate coverage for the next patient that has the same insurance coverage.

Mistake #1 – We don’t update our insurance coverage tables (bluebook)!
If you do not update your insurance coverage tables, your practice management software has no choice but to estimate payment based on a default set of category percentages or not estimate at all. Updating your coverage tables takes literally seconds when you are posting insurance checks. The EOB (explanation of benefits) is right in front of you. This is the PERFECT time to update your tables.

Mistake #2 – Duplication of insurance plan/employer information
This is the most common mistake with offices that DO put coverage table information into their computer but can’t figure out why it estimates properly sometimes and not properly some other times. You normally find this problem in offices where there are different or many staff with data entry responsibilities. Someone keeps adding insurance plans and employers that already exist in the database. In this case, an insurance coverage table for employer “A” could already exist. If the person doing data entry adds another employer “A” into the software, a whole new coverage table/bluebook has to be built over time to get accurate estimating information. There are usually three culprits that cause duplication. They are misspelling, non consistent abbreviation, and adding before looking to see if the plan already exists.

Mistake #3 – Erroneous Plan Type associated with the insurance plan
Your practice management software estimates based on the “type” of plan. Some examples would be indemnity, PPO, %PPO, flat fee PPO, Capitation, Medicaid, etc. If you have a staff member who is unfamiliar with these plan types and is doing your data entry, this may be part of the problem. If you find one of your plans not estimating properly and you have determined it’s not mistake #1 or #2 – take a look at your play types.

There you go! The challenge is before you. If you are having a tough time keeping your insurance estimation in line – take ten to fifteen minutes of time to investigate why.

I welcome any and all readers to email me with specific questions, problems, requests and challenges. Who knows? Maybe your inquiry will lead to a new Tips For Today article! Don’t worry, your inquiry will remain anonymous unless you want credit for the question.

Interested in having Mark speak to your dental society or study club?
Click here

Patient Acceptance Of Periodontal Therapy

Dr. Allan Monack
Hygiene Clinical Director
McKenzie Management
allan@mckenziemgmt.com

         In my previous article I discussed the importance of the patient recall examination. I will now give you the skills for predictable patient acceptance of the treatment they need. The proper sequencing of events leading up to the final diagnosis and treatment plan presentation will give you the greatest opportunity to have the patient agree to treatment. The role that the hygienist plays is a key element in this process. It is by helping the patient to discover and co-diagnose their problem that will lead to the

patient’s comprehension and acceptance of the treatment required.

The hygienist needs to inform the patient what to expect from the various diagnostic tests. The objective of these tests is to gather the necessary information needed to make a treatment recommendation. The hygienist or dental assistant will take radiographs and diagnostic casts, chart periodontal pockets and bleeding points, take intraoral photographs and pulp vitality tests, score plaque index, review medical and dental health changes, perform halitosis measurements, review cosmetic concerns, and do other diagnostics that are appropriate for that particular patient. It may seem like a lot of things needed. Who has enough time during the recall visit to perform all these procedures? Sometimes its necessary to forego the prophylaxis in order to prepare the patient for the needed dentistry. Obviously, not everything I mentioned needs to be done every time the patient presents for recall. After performing a cursory examination and discussing any concerns the patient may have, the appropriate diagnostics will be apparent.

It is important that the patient understands what the different diagnostics are indicating. This should be explained before the tests are taken. The patient should participate in the discovery where possible. The patient can be involved in the gathering of information as the intraoral photographs, periodontal charting, and other tests are being done. As long as the patient understands the parameters of the diagnostics, they will discover whether everything is normal or if corrective therapy is indicated. Since the most common area of concern during the recall examination is periodontal health, let us use this example to demonstrate the proper sequence of discovery, diagnosis, and treatment acceptance. It is important that the patient can identify with the periodontal charting as it is being done. I recommend giving the patient a hand held mirror.

Explain, ”This is a calibrated pocket probe. It will tell me whether there are gum pockets present in your mouth that were caused by swelling, attachment loss, or both. A normal depth is 3mm or less without bleeding on probing. Pockets greater than 3mm or bleeding need to be corrected to avoid an unhealthy situation. We now have treatment that can reduce or eliminate these pockets without surgery in many instances. A staff member will record my findings as we probe your mouth. You can watch the probing as we do it.”

If there is no one to assist in the charting use a tape recorder or voice activated computer charting system. It is important for the patient to hear the pocket measurements as they are discovered.

This technique is called co-diagnosis. The patient discovers their problem at the same time as the examiner. Now they cannot deny the problem is in their mouth. Once the periodontal charting is completed, go over the findings with the patient. Explain the treatment needed. Try to anticipate the patient objections and concerns during your explanation. Ask the patient if they have any questions about their condition. Try to answer their questions as simply as possible. Understand the protocol the office has established for different degrees of periodontal disease.

Now is the time to have the doctor present for the examination. The hygienist explains in front of the patient the findings to the doctor and what the preliminary diagnosis is and how the treatment should proceed. The patient hears the problem and possible treatment for the second time. The doctor needs to confirm the diagnosis and treatment. Then the doctor should ask the patient if they have any questions concerning therapy. Answer every question the patient presents and ask permission from the patient to schedule the therapy. The doctor should not speak until the patient responds! It is important to get the patient's input at this time. If they accept the need for treatment, they will respond positively. They may have more questions which are almost always barriers to treatment that must be overcome.

After the patient agrees to therapy, the patient is escorted to the financial coordinator and the scheduling coordinator. The hygienist again explains the treatment to the financial coordinator in front of the patient, especially what needs to be done, the appointment interval, and the importance of completing the treatment in a specified time period. The staff should reinforce that they are confident the therapy will improve the patient’s periodontal health. Make the patient feel the decision to proceed with treatment is worth the effort to a healthier mouth.

It takes a team effort to get the patient to accept necessary periodontal treatment. At staff meetings you should develop the communication skills needed to explain the diagnostic test parameters, overcome patient barriers to treatment, and discuss how the therapy will be performed. Role playing will enable the staff to deal with objections and discuss the various treatment modalities by reinforcing the same message to the patient. The patient wins because they are healthier. The staff wins because they see positive results from the treatment. The doctor wins because he has a highly motivated staff, healthier patients and increased production.

Dear Sally,
   I am thinking about selling dental related oral hygiene products in my practice but when I asked the staff if they wanted to do this, I ran up against some resistance from my staff. Can you help me out here?
Dr. Callaghan

Dear Dr. Callaghan,
   Don’t make the mistake of asking staff if they want to sell products chairside … It’s your call ...”If you’re looking for my advice on whether or not you should sell products in your office, don’t expect a simple yes or no. While it’s true that well-executed product sales can mean a considerable windfall to otherwise static or declining profits, it is not the right answer for every practice. To start with, hold your finger on your own pulse for a moment. Are you a true believer? What I mean by that is, do you believe that there are products available to you that would be of benefit to your patients?
    The sale of legitimate products to patients who’d benefit from them, is a practice-building arrangement that’ll be appreciated by many … and disregarded by the rest. When handled as it should be, chairside product sales should not amount to the lowering of anybody’s standards. Hype and arm-twisting are left out of the mix completely. Instead, it’s staged more like “here’s the product that’s helped some of our other patients and here’s why.” Straightforward and plain-spoken – if you want it, we’ve got it.
    Don’t be lulled into a false sense of security, though. Success is a team effort, and as such, when you direct your clinical staff to sell products chairside, you have the responsibility of making sure they’re properly trained to do so, and can heartily buy into the products they’re endorsing. They, on the other hand, have the responsibility to do their part – demonstrating that they are champions of both practice and patient – without ever showing a smidge of attitude.
    When a practice sells products, the typical mark up is about 50%. For whatever reason, some clinical staff are embarrassed by that, finding it objectionable. What these naïve individuals are forgetting is that this profit margin is in line with markups on crown and bridge as well as other services that they already encourage patients to take advantage of. Just as important, though, there is nothing embarrassing about a dental practice making money. And if they expect to get paid, they’ve got to understand that the practice is a business, not a philanthropic organization. Hope this helps.
Sally

For more information, email info@mckenziemgmt.com
or call 1-877-777-6151