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  03.31.05 Issue #160

   

Technology: Plan for Profit


Sally Mckenzie, CEO
The McKenzie Company
sallymck@mckenziemgmt.com

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It is often said that failing to plan is planning to fail. When it comes to technology in the dental practice, that statement could not be truer. As exciting and promising as new dental technology is, before opening the checkbook or whipping out the credit card, practices need to develop a technology plan and a budget. Without a plan, it is easy to be seduced by the latest model of this and the greatest model of that only to end up with a mishmash of excellent equipment that is, together, an inefficient jumble of circuitry and microprocessors.

Often dentists are so enamored by the specific features of a particular piece of equipment they don’t consider how well or even if that new item will work with their current platform. Consequently, all of the great “stuff” that just didn’t work out as they had anticipated winds up as the plant stand in the corner, or stuffed into the closet, or silently deleted off the system, or quietly buried in a remote location by the team.

On the other hand, those practices that are pointing and clicking their way to higher profits and greater productivity have planned exactly how they will use the technology – from the flow of patient and practice information through their practice management software to the clinical software and equipment that enables the practice to enhance diagnostic capabilities and treatment acceptance. In addition, these practices have a budget and they live within it.

Without a budget, the cash outlay for technology can quickly become overwhelming for the doctor and the practice. But how much is enough? I recommend that practices set aside about 5% of their annual gross revenues for both business and clinical technology.

On the business side, the typical budget would be about 1.5%. At that level, practices should be able to purchase the following:

  1. New computer hardware every 36 to 48 months.

  2. Practice management software, regular updates, and unlimited telephone support.

  3. On-site professional technical hardware and network installation and maintenance.

  4. A minimum of 16 hours of on-site software training annually.

Dentists should be able to use their practice management software to easily access a few key system reports regularly. First, the Accounts Receivables report. This shows the total amount of money owed the practice from patients, insurance companies, or other third parties. The report should include every account with an outstanding balance, the date of last payment, and a note indicating if payment was from the patient or the insurance company. Practices also should be able to closely monitor patient retention with the production report. Depending on your software system, it may be called Production by Provider, Practice Analysis, or Production by ADA Code. The management system also should enable the practice to track unscheduled treatment using the Unscheduled Treatment Plan Report. In addition, the system should make it easy for patients to pursue treatment. For example, the Kodak practice management software program allows you to determine in just 10 seconds if a patient is eligible for treatment financing through CareCredit. This software feature alone can significantly improve treatment acceptance.

On the clinical side, the typical annual budget would be about 3.5%. This would include both operations and clinical information management. At that level, the practice should be able to purchase the following:

  1. New computer hardware every 36 to 48 months.

  2. Practice management software, regular updates, and unlimited telephone support.

  3. All clinical software upgrades to the practice management software.

  4. Digital X-rays, digital imaging (camera), periodontal probing, etc.

  5. On-site professional technical hardware and network installation and maintenance.

  6. A minimum of 32 hours of on-site training each year.

Next to dental school, practice technology is probably the biggest investment you will make in your career. And like virtually any other product on the market, you get what you pay for, so prepare and invest your dollars wisely. Develop a plan, establish a budget, and arrange to professionally train your team. And while you’re at it, you’ll have to find something else to set the plants on.

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.



The Promised Land: The Perfect Practice Site


Scott McDonald

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Most professionals have a wish list of qualities they most want in a place where they put a practice. We have looked at several thousand practice sites and have learned that sometimes these qualities are good and some that sound good, may actually not be so good.

No Competition

It is great to be the only dentist to serve a community. Knowing that your nearest competitor is many miles away may be comforting. Unfortunately, it may also be a danger signal. For most practice settings, the ideal ratio of general dentists-to-population is between 1,100-1,300 population-to-dentists. If the doctor is considering opening a scratch practice, we put the threshold at about 1,400+. Of course income, education, population density, and employment will all be mitigating factors.

We sometimes see figures of 2,500:1. Obviously, this can be a very good opportunity for someone. But we often see factors that make this less desirable than it looks. As an example, locations with extreme poverty, crime, or unemployment will be difficult for a practice unless these factors are well understood.

Lots of Rich People

We are not talking about people who are prosperous. We mean the top 5% of the income level of the Country. These are “The Rich.” Some dentists have the mistaken idea that to locate near the very wealthy, whether in Scarborough, NY or Beverly Hills, CA will mean higher income. This is wrong for two simple reasons:

  1. The Rich move around a great deal. Most have more than one home and tend to maintain a schedule that makes recall appointments a nightmare.

  2. The Rich can be cheaper, more frustrating, and “flakier” than the average person. They are accustomed to getting their way. While they can afford more, it does not mean they will spend their money on dentistry.

Based upon our observations of how income affects dental behavior, the top 6% to 25% income level population are more stable, better referrers, and more profitable.

Gimme BIG Growth

Setting up practice in a growing area, particularly for a scratch practice, is always going to be easier than in one that is stable or in decline. The problem is that there are many other professionals also setting up practice in the same place, often at the same time. Gilbert and Scottsdale, AZ and Las Vegas, NV are famous for their huge growth. We also do many reports for dentists thinking about setting up in the same neighborhoods. And it is only logical that if we are examining the same location, there are many more doctors who have not sought our help doing the same thing.

Rather than run to the first big “mega-growth” location, we recommend looking for regions that have positive growth as well as other positive demographic characteristics.

Demographers look at “new resident growth” in two ways:

  1. New Immigrants (not necessarily just foreign immigrants but out of state move-ins as well)

  2. Migrants (those moving from one part of a region to another)

Each will have different commitments to dental practices. Each pose opportunities and risks.

But what about sites, particularly in the Northeast and Midwest, that are having a net loss in population? Actually, the shifting of populations creates opportunities for new dentists in areas that might otherwise be considered poor, as well as ways to target underserved-but-desirable residents who are NOT moving. We can help evaluate these “diamonds in the rough.”

Out of the Box” Locations

Experience has proven again and again that there are marvelous opportunities for new office sites (including satellite locations) throughout the U.S. You don’t have to move to the city d’ jour in the news that is “HOT! HOT! HOT!” to be successful. We have spent nearly twenty years examining neighborhoods in all 50 states and we can speak with confidence that there is potential out there, often where it is least expected.

Scott McDonald is the former Marketing Manager for the California Dental Association, national lecturer and author and provides demographic marketing and site analysis recommendations for The McKenzie Company. For more information email demographics@mckenziemgmt.com or visit our website http://www.mckenziemgmt.com/enhancement-marketing.html



Periodontal Disease and General Health: An Update


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

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There are new studies being conducted to try and determine the causative relationship between systemic health and periodontal disease. We know there is a strong connection but which came first. Does periodontal disease create the environment for greater susceptibility to cardiovascular disease or does the prescience of cardiovascular disease create greater risk for periodontal breakdown? After monitoring the progress of periodontal disease in my practice over a prolonged period, I believe there is a symbiotic relationship. I have seen periodontal breakdown in a patient exacerbate and then finding out the patient had a heart attack with subsequent bypass surgery. After the patient returned for dental visits the periodontal disease reverted to a more stable controlled condition. I would have thought that the patient’s periodontal condition would have gotten worse because of the reduced hygiene while recovering from the prolonged hospital stay.

In February researchers reported that adults over the age of 55 who have a higher proportion of bacteria linked to active periodontal disease also tend to have thicker carotid arteries which are a strong predictor of stroke and heart attack. This study was conducted by the NIH and published in the journal “Circulation”. The studies lead author, Moise Desvarieux, MD, PHD, said “What was interesting was the specificity of the association. These same 4 bacteria were there, they were always there in the analysis with one exception.” The study of 657 adults had their oral bacteria and carotid thickness evaluated at the same time. So which came first, the oral bacteria or the carotid thickness? There is now a study being conducted by the National Institute of Dental and Craniofacial Research under Dr, Desvarieux to follow the progression of which indicator shows up first, the carotid thickness or the 4 bacteria linked to periodontal disease.

Also in February there was a report in the “Journal of Oral and Maxillofacial Surgery” that the presence of third molars not fully impacted affected periodontal health. When these third molars were present the patient was 1.5 times more likely to have 5mm or greater periodontal pockets on the distal of second molars than those patients who did not have third molars.

An article in the January issue of “Diabetes Care” reported a link between patient mortality in type 2 diabetes and the severity of periodontal disease in that patient. The study involved 628 Pima Indians age 35 and older. The researchers used panoramic radiographs and examinations to determine the severity of periodontal disease. As the severity of the periodontal disease increased the mortality rate increased significantly. Type 3 diabetes patients with severe periodontal disease as defined in this study had a mortality rate 3.2 times greater than type 2 diabetes patients with no or mild to moderate periodontal disease combined! The researchers wrote “Periodontal disease is a strong predictor of mortality from ischemic heart disease and diabetic nephropathy.”

It is becoming more apparent that periodontal disease contributes to systemic problems. The causative bacteria in periodontal disease initiate, exacerbates or is an indicator of serious systemic problems. It is imperative that every dental office have a protocol for carefully evaluating and treating periodontal disease. If your dental office does not wish to treat this problem it is your obligation to refer the patient for the necessary treatment. I have been training dental offices since 1988 to recognize and treat periodontal disease. Every general dental practice has the ability to effectively recognize and treat periodontal disease non-surgically and refer those patients that need periodontal surgery. It is your obligation as health professionals to help your patients prolong their quality of life. Patients in your practice who ignore this problem and avoid treatment of active periodontal disease cannot be acceptable. For the sake of your patients make sure your practice makes eliminating periodontal disease a priority.

To establish a periodontal program in your practice, email hygiene@mckenziemgmt.com.






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The McKenzie Company Upcoming Events
Date Location Sponsor Speaker
Mar. 31-Apr. 2 Las Vegas, NV Dental Town Gathering Sally McKenzie & Exhibit
Apr. 1 Walnut Creek, CA Contra Costa Dental Society Sally McKenzie
Apr. 9 Portland, OR Oregon Dental Association Sally McKenzie & Exhibit
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