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Sally McKenzie,CMC
President
McKenzie Management

Sally McKenzie's
Weekly Management e-Motivator

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August 19, 2002

WEB: http://www.mckenziemgmt.com

You have 4 MONTHS to reach your year end GOALS. Will you make it? Find out here!

 

Sally McKenzie's Weekly Management e-Motivator---Issue #25

Got Your Number?

Dr. Fred Friendly is a chummy, ruddy faced fella with a hearty laugh and an empty wallet. While fee-for-service is supposed to be his game, Free-for-Service should be his name. This guy is swimming upstream and is about to go belly-up. Cash flow? Zero, Zip, Zilch. He’s been in business in a little Northwest logging community for about 30 years and has extended credit for generations –grandparents, parents, children, on and on.

Account receivables were almost four times monthly production. The worst part, he didn’t have a clue how serious his situation was, having barely paid attention to this huge, little detail. Forget your spouse’s cell phone number – this is the one number you must know. Accounts receivables is the total amount of money owed to the practice from patients, insurance companies, or other third parties, and it should never be more than one month’s production.

If your total accounts receivable exceeds your monthly production, it's a red flag indicating problems in one or more of the following areas:

• Insurance system
• Billing system
• Financial policy
• Presentation of financial arrangements
• Consistent inability of financial coordinator to ask for money.

Sally’s Recommended Actions

  • Generate an aged accounts receivable report monthly that lists every account with an outstanding balance and date of last payment.
  • Total all monies over 90 days delinquent. The percentage should not be over 15% of your total accounts receivable.
  • Examine the charges in the "current" column of the report. These are uncollected monies produced in the past 29 days. Because the practice should have a minimum of 45% over-the-counter collections for the month, there should be no more than 55% in the current column awaiting insurance reimbursement.
  • Always run the report with credit balances because credit balances need to be added back to the total accounts receivable.
  • Make one employee accountable for collecting money, generating accounts receivable reports, and following up on delinquent accounts.

Get the 411 on your numbers; carefully monitor your accounts receivables.

SPECIAL OFFER this week for our newsletter subscribers only! Improve YOUR Cash Flow!!! Buy the "CASH FLOW MANAGEMENT" power book for $35 and save $12 off the retail price. Click here to order.

Technology Tool Box
A series of short weekly chores designed to keep the return on investment in technology at its highest level.
Mark Dilatush, VP of Professional Relations
, McKenzie Management
Mark@mckenziemgmt.com • 1-877-777-6151 Ext. 28

Billing – Accounts Receivable
Purpose: Accelerate cash flow, lower A/R, smooth cash flow, smooth work load

What to do:

  1. Verify that your computer system can run billing every day without re-billing patients who just received a statement.
  2. Run billing every day.
  3. Print and send any statements that come out of the printer.
  4. Run you’re A/R for patients over 30 days at least twice per week. The only “new” people to show up will be “just” over 30 days.
  5. Contact everyone on the list.

When:

  1. Start today
  2. Never stop

What now?

  1. The first 30 days, you will have very few bills every day and a lot on one day (your old billing day). Eventually, this will spread out throughout the month.
  2. Incoming patient calls regarding bills will spread out.
  3. Incoming payments will be up to 28 days early and spread out throughout the month.
  4. Fewer patients will make their way to your over 30 day list and you will have fewer patients to contact.
  5. More money in the practice’s pocket.
What if your Business Staff had the Training, Efficiency, Knowledge, Expertise and Organization of the Nation’s TOP Dental Management Consultants? Sally McKenzie, President of McKenzie Management is pleased to announce the opening of the Nation’s FIRST PREMIERE Dental Performance Enhancement Center. The Center for Dental Career Development located in Beautiful LA JOLLA, CALIFORNIA! Click Here.

This issue is sponsored in part by:

McKenzie Management - A full service, in-office dental management consulting company specializing in the business, clinical, and hygiene areas of practices nationwide.You can find McKenzie Management at http://www.mckenziemgmt.com

CareCredit - More than 30,000 healthcare practices nationwide use CareCredit as an alternative means of helping their patients finance treatment. You can find CareCredit at http://www.carecredit.com

The Center for Dental Career Development - Providing Advanced Business Education for dentists and training for business employees as well as Team Building Retreats for the entire dental team in Beautiful La Jolla, California. You can find The Center for Dental Career Development at http://www.dentalcareerdevelop.com

DentalTown - Never practice solo again! DentalTown.com is a free community, hosting dentistry's MOST ACTIVE message boards, classified ads and a dental event calendar.The site is open to dental professionals throughout the world, 24-hours a day, 7 days a week. Once you visit, you'll wonder how you ever practiced without it! Log onto http://www.dentaltown.com TODAY!

Lares Research - Make Your Practice Profitability Soar! SoftCare boosts your hygiene department profitability to a new level. Treatment of periodontal disease with the Lares' PocketPro Lasers is easy to learn and offers a quick and dramatic return on your investment. Lares lasers will also make your dentistry faster and easier. Visit us at http://www.laresdental.com/products/lsc/default.asp or call 800-347-3289, ext. 1 and schedule an educational presentation.

HPSC - Finances, via lease or loan, dental and office equipment, leasehold improvements, working capital and supply contracts at fixed competitive rates, with no points, variables or hidden fees. HPSC also offers a variety of financing programs to dental professionals seeking to set up, expand, buy into, or acquire a practice.
http://www.hpsc.com/

INFORMS - Allow InForms to participate in your successful practice by becoming the "ONE STOP SOURCE" for your front office needs. We carry a full range of products including: recall and appointment cards, registration forms, exam forms, statements and envelopes, folders and labels. Call us at 1-800-722-4884 or email us at informs@bellsouth.net today to receive your catalog.

 


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