Ready to Raise Your Fees? Follow These Tips
You’ve finally decided it’s time to adjust your fees. It’s been awhile, and you know the extra money will boost your bottom line so you can finally invest in the new technology you’ve been eyeing or take the CE courses you need to expand your skills. Yes, you’re ready…but not only are you still afraid of losing patients when they find out about the higher prices, you’re not sure where to start.
Don’t worry. That’s where I come in. Establishing fees can be tricky, but it’s vital to practice success and profitability. It also helps you improve the level of care you offer, which is more important to most patients than saving a few dollars on a procedure. Still, I know the thought of raising fees makes most dentists uneasy. That’s why I’ve put together a few tips to help you establish a solid fee schedule that will be fair to both you and your patients while turning your struggling practice into a thriving practice.
1. Do a little research. Before you adjust your fees, find out what other dentists in your community charge. Make sure your fees aren’t too far below (or above) the local marketplace. Your fees should also reflect the level of care and overall patient experience your practice offers.
2. Establish a solid fee for each service you offer. Don’t guess when establishing or adjusting your fees; determine how much it actually costs for you to perform the dentistry. From there, base your fees on patient base, debt, overhead, expenses and your experience level.
3. Monitor your overhead expenses. Make sure your overhead expenses line up with industry benchmarks. Not sure what those benchmarks are? Here’s the breakdown: Laboratory: 10%, Dental and office supplies: 7%, Rent: 5%, Employee salaries: 19-22%, Payroll taxes and benefits: 3-5% of collections.
4. Plan for fee increases. Establish a solid fee for each service you provide and then plan to adjust those fees twice a year. I suggest you raise fees 2% the first time and 3% the second time for a 5% yearly increase. It might not seem like a lot, but this slight increase will significantly boost your bottom line.
5. Focus on building a rapport with your patients. Most patients want to feel some kind of connection to the practice they call their dental home. They want to know you care about them as people and aren’t just worried about selling dentistry. To build these connections, talk with your patients about their jobs, their families and their oral health goals. Educate them about their condition and the services you provide, and train your team members to offer exceptional customer service during every patient interaction.
When you show patients you care, they’ll be much more likely to become loyal patients who don’t even flinch when your fees go up.
6. Create goals. Figure out what kind of lifestyle you want to live, and then determine how much you need to make each year to get there. Factor in how many weeks you want to work each year, how many hours per week and how many patients you want to see each day. Use these numbers to determine daily production goals, which should serve as a guide as you establish or adjust your fees.
7. Avoid the fee ceiling trap. Don’t trap yourself by attempting to establish your office fee schedule based on what some third-party payer reimburses at 65% of the 85th percentile.
If you want to own a successful, thriving dental practice, you have to consider adjusting your fees from time to time. It’s an important part of owning a dental practice and is something your patients expect. If you take the time to create connections and show patients the value of dentistry and the services you provide, raising your fees won’t send them to the practice down the street. Fee increases will enable you to provide patients with a better overall experience and enhanced care, which will make them want to stay loyal to your practice and even refer you to family and friends.
Need more guidance? Feel free to give my office a call at 877-777-6151. I’ll conduct a Fee Analysis to help get you on the right track toward true success and profitability.
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
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