7.24.15 Issue #698 info@mckenziemgmt.com 1-877-777-6151 Forward This Newsletter
 

4 Ways To Get Overhead Costs Under Control
By Sally McKenzie, CEO

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Looking around your practice, you can see there’s plenty of room for improvement. You’d love to create a more relaxing, comfortable waiting area for your patients and invest in the type of high-tech equipment that attracts new patients and expands the services you currently offer. Yes, you’d love to make some practice updates and upgrades, but with your present financial situation, you won’t be making those changes any time soon.

Instead of investing in your practice, you’re stuck trying to cover out-of-control overhead costs. And not only are you starting to think you’ll never put away enough money to retire, deep down you know your practice might not survive if something doesn’t change soon.

Yes, this is a stressful situation, but that doesn’t mean you can’t get back on the right track. If you commit to making changes, you can get your overhead costs under control and take your practice back. Here are a few tips to get you started.

1. Stop relying on pre-appointing alone. If your practice deals with a lot of cancellations and no-shows, pre-appointing is at least partly to blame. I know most practices still like to schedule patients six months out, but chances are many of these patients aren’t going to show up for their appointments. Whether something else comes up or they just plain forget, the result is the same – holes in the schedule that keep you from meeting your daily production goals.

Instead of relying on pre-appointing, invest in your recall system. Task your Patient Coordinator with calling and scheduling a specific number of recall patients a day. You’ll be amazed what this will do for your patient retention numbers, not to mention the reduction you’ll see in overhead costs.

Another problem with pre-appointing? It gives the illusion your hygiene schedule is full, which keeps new and current patients from scheduling appointments. Problem is, many of those booked slots become last minute openings your coordinator has to scramble to fill. And of course, filling these slots is not always successful, which likely means your hygienist’s salary has soared well beyond the benchmark of 33% of net production, sending overhead skyrocketing.

2. Establish performance standards. Before you give another raise, sit down with your team members and establish performance measurements. Make sure every team member understands raises will be given based on these measurements, not just because they asked or because a year has gone by. Conduct performance reviews and explain to current team members and new hires exactly when raises can be discussed and under what conditions they will be given.

Your team members might not like this at first, but when they see the relationship between their performance, the practice’s success and their ability to earn more, they’ll place more trust in the system, and be more likely to work to meet practice goals.

If you’re used to giving out raises to keep your team members happy, this could be a difficult change – but it’s a necessary one. Remember, payroll costs should be between 20-22% of your revenue, with an additional 3-5% to cover payroll taxes and benefits. Any more than that will send your overhead costs spinning out of control. If you only give out raises when they’re earned, you’ll find your overhead costs will begin to come down while your production numbers finally go up.

3. Implement a perio program in your hygiene department. If you want to improve production and reduce overhead costs, I suggest incorporating an interceptive periodontal program in your practice.

The truth is, most patients exhibit signs of periodontal disease. Yet few hygiene departments offer this type of program, simply because dentists and their team members are afraid of upsetting their patients. It’s your job as health care professionals to tell patients about the presence of periodontal disease and educate them on their condition and the best way to treat it. Implementing this type of program will help improve your patients’ health, increase your production numbers and reduce your overhead.

4. Raise your fees. Most dentists cringe at the thought of raising their fees. They think patients will run to the practice down the street if the price of dentistry goes up, so they convince themselves that keeping their fees consistent is the best move, and will help their practice grow rather than hurt it.

I’m here to tell you never raising your fees will, indeed, hurt your practice. The fastest, easiest way to increase profits and reduce overhead is to increase your fees. If you never raise your fees, it’s contributing to your overhead woes.

I suggest establishing a solid fee schedule that is fair to both your patients and your practice. The fee schedule you develop should be based on solid data, not emotion. Does the thought of raising fees still make you uncomfortable? Remember that patients are willing to pay for quality dentistry. Loyal patients won’t look for another dental home just because you raise your fees. In fact, most patients probably expect it.

Managing overhead costs isn’t easy, but it’s necessary if you want a successful dental practice. If you’re ready to commit to making changes, remember you don’t have to do it alone. I’m happy to help you improve your production numbers, reduce your overhead costs and turn your struggling practice into a profitable practice.

For additional information on this topic and more, visit my blog: The Lighter Side

Interested in speaking to me about your practice concerns? Email sallymck@mckenziemgmt.com
Interested in having McKenzie Management Seminars speak to your dental society or study club? Click here.
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Jonathan Gale, Ph.D.
Leadership Coach
McKenzie Management
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The Effects of Change on the Leader
By Jonathan Gale, Ph.D.

Change and managing change are common topics among leaders and consultants, but rarely do people pay any attention to the effects of high rates of change, or difficult to manage change (like healthcare reform) on the leaders.

One of the least mentioned effects of change relates to how it impacts the one leading the change, and his or her ability to effectively leverage the leadership role throughout the change process. Resistance, fear and performance issues are well known reactions by employees and staff to big change, but the leader is subject to the same reactions. Some types of change, such as restructuring or implementing new systems, can put considerable strain on business leaders.

Stress, Stress & More Stress
One primary concern regarding change is the stress it imposes on those undergoing the change. Leaders, because they have obligations to their staff, have to be in front of and guiding the change to minimize the negative effects on their staff and make efforts to keep staff engaged through the change process. Inevitably, leaders do share and even take on some of the concerns of their staff. In the case of implementing a new system, stress levels among staff can be extremely high, as people are being asked to step out of their comfort zones and begin the learning process all over again. As the leader, anticipating reactive behaviors or loss of confidence can disrupt concentration and the ability to stay optimistic through the change.
 
Stress is part of the job, but in times of change, it is critical that you as the leader recognize it may cause you to act in ways that are less effective than usual. As with anything connected to change, the long-term concerns far outweigh the short-term. If your stress level goes unchecked, it may result in a marked loss of effectiveness. This loss of effectiveness can cause a vicious cycle in which ineffective leadership results in the creation of more long-term problems, which increases your stress, causing a further decrease in your overall effectiveness, etc.

Avoidance -- A Common Response
A common response to change is to ignore the situation. Avoidance can take many forms. Most commonly, the avoidant leader plays only a minimal role in moving his or her people through the trials and tribulations of change. After announcing the change and doing the minimum required, the avoidant leader “hides” from the change, through delegation or attending to other work. This tactic involves treating things as “business as usual,” or “not my problem.”

The outcomes of this tactic can be quite negative. By relinquishing the helm and avoiding leading the team through the rough seas of change, staff become disheartened, disengaged in the process, they look for work elsewhere, or they become ineffective. Furthermore, you could lose the trust and faith of your staff, upon which you depend for the survival of your business. When a leader takes the stance, “it’s not my problem,” he or she becomes part of the problem and not the solution. It is the staff who make any change possible, and therefore they need to see the right behaviors modeled by their leader, such as accountability, responsibility and getting through together.

While avoidance serves a need for the leader in the short run, it destroys the leader’s credibility and results in poor followership. The long-term consequence of such action is that the business tends to deteriorate in terms of morale, effectiveness and productivity. Sometimes this deterioration is irreversible.

Denial -- Another Ineffective Tactic
Sometimes the leader deals with change by denying its impact. Usually, the denying leader takes a very logical approach to change. Decisions get made, systems are put in place, or new procedures are developed. Unfortunately, this “logical” approach denies the impact of change on the people who make up your practice. 

The denying leader tends to refuse to understand “what the big deal is” and shows little empathy with employees in the organization. As with avoidance, the denying tactic tends to drop the leader’s credibility and deteriorate personal loyalty on the part of employees.  

Key Points
1) Leaders are put under stress by change. If mishandled, that stress can result in loss of leadership effectiveness. Leaders need to be alert to the signs of stress upon their performance.

2) A common leadership tactic is to avoid involvement in change when that involvement is unpleasant or uncomfortable. The effects of this withdrawal can be lethal to the business and by extension, to the leader.

3) Another common tactic is denial of the effects of change. Leaders who do this tend to underestimate the impact of the change, and demonstrate an inability to respond to employees' emotional reactions to change. 

Dr. Gale provides coaching and training to enhance leadership skills, interpersonal communications and team building. If you would like to learn more, contact him at jgalephd@mckenziemgmt.com

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Carol Tekavec, RDH
Hygiene Consultant
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The “To Do” List - Make Time at Every Hygiene Appointment!
By Carol Tekavec RDH

The hygiene appointment can often take on a predictable, routine, and rushed character. Seat patient, perform prophy, exam with the dentist, set up next appointment, on to the next patient. Experienced hygienists often report burnout and boredom with their jobs. They also say there is not enough time to perform all the procedures they know should be addressed, so procedures are left undone. They feel under pressure and pushed by the clock, unappreciated by patients and their dentist employers. They are nagged by an undercurrent of knowing that more should be happening at their hygiene appointments, but they can’t figure out how to make this happen. There just isn’t time. One experienced hygienist told me that when she retired she would never own a watch again!

A burned-out, bored, rushed hygienist is not an efficient advocate for any dental practice. This person is just going through the motions. The hygienist may still be able to function as a production center, but is not being utilized to his or her full capability as a catalyst for new treatment. 

A hygienist who has the time and is appreciated for what he or she does is both a production center AND a practice builder. New patients are wonderful, but patients of record who have treatment identified and scheduled are the life blood of a dental practice. Where is this treatment identified? During the hygiene appointment. Who encourages the scheduling of said identified treatment? The dentist, of course. But the hygienist is often the one who provides that little extra push to be sure an appointment is set up.

Hygienists need to have a “To Do” list, and the time to complete it at every hygiene appointment. The hygienist will be happier, the practice will be more productive, and patients will be receiving better care.

Update the patient’s medical history. Just because a patient has been coming in for many years does not mean this step can be skipped. Many systemic conditions affect oral conditions. We need to know medical history, for the patient’s care as well as their safety. Patients appreciate that we are concerned for their general health. They accept treatment from offices who have their best interests at heart.

Perform a full-mouth periodontal probing and recording. This should be accomplished at a minimum of once annually. Better still at each recall. Why? Because pocket depths and bleeding points are essential in diagnosing periodontal disease. Early detection can allow appropriate treatment, such as isolated scaling and root planing of pockets deeper than 4mm. Just because a patient has not demonstrated any pocketing previously does not mean that probing can be ignored. To save time, the hygienist may need help with recording, or a vocal or “foot pedal” method can be employed. Whatever is required, identifying perio disease is an important function of a hygienist, fundamental to a patient’s health, and critical for office production.

Expose necessary radiographs.  Patients don’t like x-rays. However, without them diagnosis of dental disease is severely curtailed. Explain to patients that a car mechanic is not able to tell what is wrong with an automobile engine by looking at the hood of a car. Similarly, a dentist and hygienist cannot tell what might be wrong in a person’s mouth by merely looking at the “tops of the teeth”. Be sure to document why any radiographs are being taken in a patient’s record. For example; four bitewing x-rays were taken to look for interproximal decay of molars and bicuspids. Many insurance carriers are now requiring documentation of the need for any radiographs in order for payment to apply. The “need for the radiographs” cannot be just because they are covered by insurance.

Point out any problem areas. Hygienists should mention any possible problems they notice to their patients prior to the dentist coming in for the exam. The issues can then be mentioned to the dentist, who can either confirm the problem or make another determination. When patients hear it first from the hygienist and then again from the dentist, they are likely to schedule treatment. For example, “Ms. Patient, your first molar on the lower right side has a broken filling. I am thinking that Dr. Dentist will likely recommend a crown for that tooth.” When the dentist arrives the hygienist can say, “Dr. Dentist, I noticed that Ms. Patient’s first molar on the lower right side has a broken filling.  Does it need a crown?” Then the doctor can say, “I see that problem and a crown would be best” or “I see what you are noticing, but I think another restoration can work.” 

Apply topical fluoride. Current thinking on the use of fluoride varnish is that patients of all ages can benefit from this outstanding product. Therefore, taking the time to make this happen is good for patients and good for the practice. The hygienist can say, “We now know that fluoride varnish is important for almost all of our patients. I can see that you have several teeth with 2-3mm of exposed root surfaces. The varnish will help to guard against these areas becoming decayed. Your insurance may cover this, but if it does not the cost is only X.” Very few patients will refuse this excellent adjunct to their hygiene appointment.

You may have other services that you want to include in your “To Do” list for every hygiene/dentist recall. The important thing is that time is allotted for the services and not just “crammed in” to an already too full schedule. Both the hygienist and the practice will be better for it. 

Carol Tekavec RDH is the Director of Hygiene for McKenzie Management. Carol can improve your hygiene department in just one day of training “in your office.” Interested in knowing more about how to improve your hygiene department?  Email hygiene@mckenziemgmt.com.

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