How to Bring More Money into Your Practice
|By Sally McKenzie, CEO
Do you want to create a more successful, profitable practice? Then it’s time to embrace your role as practice CEO, and to start paying more attention to practice financials.
I know. You didn’t become a dentist because you wanted to deal with business issues. You’d much rather spend all your energy on patients and delivering the best care possible. While of course that’s something you should focus on, you can’t ignore the business side of running a practice and be successful.
Knowing what influences revenue losses and gains and tracking practice profits will help you better understand your business so you can bring more money in. You’re probably wondering how, exactly, you can do that, especially if you don’t have much of a business background. Not to worry. I can help you. Here are my tips:
Create a 10-Point Financial Assessment
The ultimate goal is to increase practice profits, but you really can’t do that until you have a firm grasp on your practice’s financial health. If the thought of that seems overwhelming, that’s OK. Most dentists feel the same way, but it really isn’t as scary as it sounds. You can start your financial assessment by asking yourself these 10 questions:
1. Am I bringing in as much money as I believe I should/could be?
2. Am I saving enough money for retirement?
3. Have I been waiting to save money for retirement until practice revenues increase?
4. Have I ever skipped making payments to my retirement fund?
5. Do I have enough revenue to cover continuing education costs for myself as well as my team members?
6. Do I hesitate before investing in new equipment because I’m worried about the price tag?
7. Do I delay making improvements to the practice’s appearance because I’m worried about how much it costs?
8. Am I effectively marketing my practice and services to existing and prospective patients?
9. Is giving out staff raises a concern?
10. Do I feel like it’s impossible to work any harder than I already do?
Really think about the answers to these questions and be honest. Once you’re done, you’ll have a much clearer picture of your practice’s financial health, and can start creating a plan that will grow your income.
Develop a Financial Policy
If you don’t have a financial policy, it really could be hurting your practice. Such a policy will make it clear to patients when you expect to be paid for services rendered, making them more likely to provide payment on time.
Here’s what you should include in your policy:
Third Party Financing
Many patients say no to treatment simply because they can’t afford it. That’s where third party financing from companies like CareCredit comes into play. Patients are able to make small monthly payments toward the total bill, significantly easing the financial burden and making going forward with treatment much more feasible. You get paid and patients have a much easier time saying yes to more expensive treatment, resulting in a boost in practice productivity as well as profits.
Your patients are busy people, and need a convenient way to pay their bills. Electronic billing offers that. Patients can go into their account, check their statement balance and make a payment no matter what time of day or night it is. Another benefit? Electronic billing saves your team members time. They don’t have to worry about billing nearly as much, freeing them up to take on other tasks.
Some patients have the means to pay for their treatment upfront. Encourage them to do so by offering incentives. What kind of incentives, you ask? I suggest a small fee adjustment. Just be sure to record this as a “bookkeeping adjustment” rather than a discount.
Collect Payment for Smaller Amounts at the End of Every Appointment
Let patients know they’re expected to pay before they leave the office. Make this clear so there’s no surprises or push back from patients who thought they would receive a bill in the mail. I also suggest you require all insured patients to pay the amount they’re responsible for before they leave the practice.
Make Patients Aware of the Policy
Developing a payment policy won’t do you much good if patients don’t know it exists. I suggest you give the policy to every new patient and then ask them for a signature to acknowledge they received it. Remind existing patients of your policy as they’re scheduling treatment, and include the policy on the practice website.
I know the thought of tracking financials and actually understanding what they mean for your practice can seem overwhelming, but it really is essential to your success. The good news is you don’t have to do it on your own. I can help. If you need more guidance, don’t hesitate to reach out. Together, we’ll start growing practice profits.
Interested in speaking to Sally about your practice concerns? Email firstname.lastname@example.org
Interested in hosting McKenzie Management Seminars for your dental society or study club? Click here.
Be sure to find us on Facebook!