5 Signs It's Time to Adjust Your Fees
Where you set your fees is a personal decision, but it’s one that directly impacts your practice’s success. If you set them too high you run the risk of deterring patients from making your practice their dental home, but if your fees are too low your practice will never meet its full potential.
Whether you decide it’s time to raise your fees or lower them, there are a few key points you should consider before making your move. Here are five signs it’s time to adjust your fees, and tips to help you determine the best fee schedule for both your patients and your practice.
1. You have no idea what other dentists in your community charge. Often, dentists establish their fees without checking what other dentists in the area charge. Sound familiar? Then you need to find out how your fees compare to other practices in your community. If yours are significantly lower or higher, you’ll want to make adjustments.
Beyond researching other dental offices in your area, I suggest contacting your Chamber of Commerce to collect information on your area’s demographics and income level. These are two important factors you should consider when establishing or adjusting fees. You can also find more information on dental fees online or through your local dental society. Just remember that fees not only need to be in-line with the community you’re serving, they should reflect your practice and the level of service you provide.
2. Your fees are the lowest or highest in your area. Like it or not, the fees you set send current and potential patients a message about your practice. If your fees are the lowest in the area, your practice is the perfect target for price shoppers who are more focused on finding a deal than a dental home. If your fees are the highest, you have to make sure the level of service you offer warrants the rates you charge. Do you offer exceptional customer service, or provide an experience that no other dentist in the area can match? If you can’t justify your high rates, it actually might be time to slightly decrease your fees so they’re more in-line with your competition.
3. You can’t remember the last time you raised your fees. If it’s been years since you’ve made a fee increase, or if you have no system in place for making rate adjustments, now is the time to make sure you’re not undercharging. This is important, because if you’re undercharging it’s costing your practice big. Don’t believe me? Think about this. Undercharging patients by as little as 7-8% costs you thousands of dollars in lost revenue each year, and undercharging by 40-50% translates into a serious financial pounding.
You have to base fee adjustments on logic, not on a fear of losing patients or because you feel guilty about raising rates. I suggest establishing a solid fee for each service, and then adjusting twice a year. For example, the first fee increase could be 2%, followed by 3% for an annual yearly increase of 5%. This might not seem like a lot, but even if you’re only raising fees $4-$5 per procedure, you’ll still notice a significant difference in your bottom line.
4. Your fees aren’t consistent. Some dentists set fees too low for certain services, and too high for others. For example, they may keep hygiene fees well below what they should be, then charge a much higher rate for crowns. This seesaw fee structure isn’t going to help your practice grow, and will likely only serve to confuse and annoy patients. Base your fees on your goals and data from the community you serve, and you’ll find your practice will be much more successful.
5. You’re not meeting your financial goals. You have to stay focused on your practice vision and goals. Think about what you want from your career and the lifestyle you’d like to lead, and then determine how much revenue your practice needs to bring in to make your goals a reality. This allows you to establish fees that will help you meet your personal and professional goals.
Remember, you need to create value for your patients. Provide the best care possible, and a level of dentistry that achieves the greatest return for your patients. When patients understand the value of the services you provide, they’ll be much less likely to balk at fee increases.
Still not sure if it’s time to adjust your fees? I’d be happy to provide a Fee Analysis for your practice. Give me a call at 877-777-6151 and we’ll get started.
Next week, How to establish a solid fee schedule.
For additional information on this topic and more, visit my blog: The Lighter Side
Interested in speaking to me about your practice concerns? Email firstname.lastname@example.org
The Art of Appreciation
Do you really know what tasks your business team members perform during the day? My guess is “not really.” You work closely with your clinical team and appreciate what they do for you and your patients. You realize that without them, you could not provide proper care for your patients. But often the business team members are the “black sheep” of the office. They can be misunderstood and underappreciated for all they do for you and your patients. What could be changed to give you and the clinical team a better understanding of their contribution to the success of your practice?
What Do You Know?
In fairness to you, the doctor, specific systems must be in place to know what you need to know. Job descriptions and a mechanism for accountability are essential for you to appreciate their tasks and how well they perform these tasks.
Do you know the following?
These are just a few of the questions you should be able to answer with confidence if you have more than one business team member working for you.
Who Do You Know?
When you can identify tasks with a specific employee, it allows you to address specific questions directly to that person. Each team member is responsible for knowing the answer, opposed to “Doctor, I didn’t do that so I don’t know.”
Empowered employees WANT to be responsible for their own tasks. They do not enjoy being expected to know the answer to tasks they do not perform regularly, or reprimanded for a task they are not accountable for.
How Do You Know
Example #1: Do you know what percentage of your Accounts Receivables are over 90 days? It is the Financial Coordinator’s responsibility to know this information and report it to you and the other team members via the monthly monitor.
Example #2: Do you know what percentage of payments coming into the office every day are made at the time of service? This ensures that the business team asks patients for “their portion” if insurance is involved. This is the responsibility of the Schedule Coordinator, since she/he is typically the person checking out patients and making their next appointment.
Show Appreciation for Your Team
Don’t forget to rave about your clinical team as well. Yes, the Scheduling Coordinator can schedule you to meet your daily goal, but it takes the assistants working with you to be efficient while providing quality care with a smile for all your patients. Congratulate your hygienists for reaching their goals, as scheduled by your Hygiene Coordinator.
It takes a team working together to make every day run as smoothly as possible. Take a moment to recognize your individual team members for a job well done. Thank them after a busy day. Say “good-bye” at the end of the day before going home. I can promise you they will appreciate it!
The Dirty Dozen of Denied Dental Insurance Claims
“We just write it off and send the bill to the patient, after all it is their insurance and their problem. We did our part and should be paid regardless.”
The problem with this statement is that patients don’t like to pay the part of the bill that insurance was supposed to pay. This makes for unhappy patients who are likely to not return to your practice. The appeal process is a practice system that is to be expected if you are doing any services other than diagnostic and preventive – and even those are subject to limitations. In many practices, patients with dental insurance make up the majority of the active patient base, so not appealing claims can be costly all the way around.
To be prepared, the person or people in charge of making patient appointments and entering patient data should be trained in attaining the correct insurance information so claims will not be denied and will be paid quickly. Filing claims electronically is a must, and will soon be mandatory as more and more insurance companies no longer accept paper claims. Update your software so you have the current ADA 2012 claim form and the current CDT 2015 codes going out, or your claims will be denied. File your standard fee schedule on all claims.
The following is a checklist of why claims are commonly denied:
1. Wrong or missing information on the claim. Do you have the correct subscriber identification number on the claim? Check the gender, date of birth, relationship to provider, employer and group number and make sure every field is correctly filled out.
2. Unreadable claims or documentation. More insurance companies are using OCR scanners, and if they cannot detect handwritten notes you will be denied.
3. Missing Tooth clause. The patient may have coverage for a fixed bridge, but under the condition that the missing tooth was extracted while covered under their policy. If not, no coverage.
4. Waiting periods. Often seen on private insurance plans. A patient sometimes has to wait a year to get coverage for major restorations such as crowns.
5. Age of patient. Sealants are commonly denied because the patient was too old to receive a sealant per the contract. This could apply to other services as well.
6. Frequency limitations on procedures that are covered by the policy. Some insurance companies pay for two preventive prophys within a year, some will pay for two if they are six months and a day apart only. Frequency limitations apply to most procedures.
7. Contractual limitations. Some procedures are not covered at all on certain policies, even though the same insurance company may have covered someone else with different group coverage.
8. Student verification. Some policies will cover older children if they are full time college students. Usually this is provided by the parent to the insurance, but if it’s not on file it will result in denied claims.
9. Incorrect CDT coding. If you haven’t updated your codes to the new CDT2015 this could get the claim denied, as would using the wrong code on a procedure, such as using a single unit crown code for a prosthetic retainer or using an x999 code without a narrative.
10. Not indicating whether the prosthetic is an initial placement or a replacement. In the case of a replacement, the reason for replacement must be narrated as well as the date of prior placement.
11. Documentation such as periodontal charting is not readable. Computer produced periodontal charting should always be used instead of the paper ones that are not legible when scanned. Provide good quality x-rays showing the whole tooth and the apex, and a clear panorex for prosthetics and periodontal services. Including intra-oral photos can make the difference with conditions not visible in the x-ray.
12. No follow-up from correspondence to the office. Insurance companies ask for more information as part of the appeal process. Many offices do not take the time to appeal claims, which is why thousands of dollars that could have been collected are written off every year.
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