Buying a Practice? Do This First
When I sat down with “Dr. Michael” he was distraught. He shook his head and wondered how he had so severely misjudged things. It had seemed so perfect in the beginning. After years of working as an associate, he had finally purchased a practice back home where he and his wife grew up. With young children of their own, they were eager to get back to their roots and have family nearby.
The practice he bought seemed like a great deal at the time. It was in a neighborhood that he remembered was brimming with young families years ago. The practice numbers seemed okay and the staff seemed fine. Bottom line, he was eager to make a decision. He just knew this was the right place ... until he discovered that it wasn’t.
Dr. Michael had purchased an illusion - one largely of his own making. And the reality threatened to turn his and his wife’s dream into a nightmare. The neighborhood that was once filled with families and school-age children was in transition. While it may have been on the cusp of revitalization, the majority of people were older. Many were approaching retirement age, and many more were well beyond that.
While he thought that the active patient base was healthy at around 1200, he took the number at face value and didn’t ask any questions that might have revealed more information. Shortly after taking over the practice he realized that the roughly 1200 records included hundreds of patients who had not been in for hygiene appointments in nearly two years. Worse yet, the selling doctor worked three days a week but employed two hygienists, two assistants, and three business staff who all had too much time on their hands. The drain on overhead was huge.
Dr. Michael agonized over the possibility that he would have to lay off half the staff. What would be the repercussions with those that he retained? The employees knew the patients. They had established relationships. He did not. He was the outsider in his newly-purchased practice. Yet there were just too many, and he was the one responsible for paying that hefty payroll.
Compounding the problem, many of the patients who actually were active were accustomed to the former doctor’s philosophy of care, which was very different from Dr. Michael’s. He dreamed of recommending and providing what he considered to be “ideal” dentistry. He had pursued extensive continuing education in implants, veneers, and endo. His predecessor was extremely conservative in his treatment recommendations, and he referred out numerous cases that Dr. Michael would have considered routine.
Dr. Michael’s situation is not uncommon. He purchased the practice he thought he wanted. He did a little research, but he wanted to see what he wanted to see - a practice with potential in a quaint neighborhood with an experienced staff. With help, Dr. Michael was able to turn the situation around. But it required thousands of dollars, several months, and enormous personal sacrifice for him and his family. It also required a host of difficult decisions and unforeseen challenges that Dr. Michael could have avoided.
If he could do it all again, Dr. Michael readily acknowledges that he would be smarter. He would make a small investment in a practice evaluation up front. Practice evaluations are different from practice valuations. Valuations are the dollar value of a practice, and typically they are compiled by practice brokers who represent the sellers. Whereas an evaluation is a due diligence review of the entire practice that is up for sale, including the 20 business operational systems, the profit and loss statement, the computer reports, the tax returns, the demographics, the fees, and the staff.
Beyond the equipment and the production, it can be challenging for buyers to evaluate the future worth of a practice that they intend to purchase. Having a full understanding of the actual and projected earnings as well as the strengths, weaknesses, and revenue earning opportunities is critical to making a buying decision.
Before you commit to the biggest investment of your life, consider a Dental Practice Acquisition Evaluation by McKenzie Management.
Next week - why evaluations make it easier to pull the trigger.
For more 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
Hellos and Good-Byes at Your Office
“You had me at hello.” Remember that line from Jerry Maguire? This is exactly what you want patients to say after their first phone call with your office. And let’s not forget when Arnold Schwarzenegger said, “I’ll be back!” You want your patients to say this, as well! Let’s look at some common patient communication scenarios and see where areas for improvement may be.
Initial Phone Call
First, it was actually the afternoon when she answered the phone, but your team hadn’t been to lunch yet so for them it was still morning. Instead of having to think about “morning or afternoon”, how about simply saying “Thank you for calling.” Second, who is this person answering the phone? Since the incoming phone call is an introduction to the office, it is appropriate for the person answering to introduce themselves. Third, what will the Business Coordinator do with this call - offer to assist, transfer the call or not extend their request to assist? “Thank you for calling Dr. Smith’s office, this is Julie, how may I assist you today?”
If more than one team member works in the business office, it is more efficient to ask the caller, in a very pleasant and helpful voice, “How may I direct your call?” If there is only one Business Coordinator at the front desk, then it would be just fine to answer with “How may I help you?” or “How may I be of assistance?” If you have wonderful clinical team members who are willing to answer the phone to keep it from ringing, I would recommend that they use “How may I direct your call?”
“How may I direct your call” allows the Schedule Coordinator who answered the phone to transfer the call to the Financial Coordinator, who is very familiar with the patient’s financial concerns since she/he works with the accounts daily. The Schedule Coordinator is busy “dialing for dollars” because there is a 2:00 opening on the doctor’s schedule today and the doctor is not scheduled to produce the daily goal.
Arrival at the Office
The clinical team member escorts Bob over to Sandy the Schedule Coordinator so she can schedule his next appointment. As Bob approaches Sandy, it is important that she looks up from her computer monitor, smiles and says “Hi Bob! How did everything go today?” She then reviews the services that were delivered and requests his payment for $75, which was pre-determined when his appointment was made so there is no surprise today. Again she requests his payment, makes eyes contact and smiles. She says nothing and just continues to smile until the checkbook, credit card or cash comes out of his wallet. Remember - whoever speaks next loses!
Sandy thanks Bob for his payment and proceeds to schedule his next appointment. She doesn’t ask when he wants to come in because she has a specific appointment time that needs to be filled, so she offers that time-slot first in hopes that he will take it. She has a scheduling “puzzle” to put together in order to reach the daily goals of the providers.
Sandy’s good-bye to Bob is warm and friendly. She asks if there is anything else she can do for him today, says thank you for taking time out of his busy schedule to visit, and tells him that she looks forward to seeing him again on August 5 at 3:00. Bob leaves saying to himself, “they are just so nice here…and I’ll be back!”
Practice Compliance: Job Duty of the Office Manager
Great people skills and excellent business office skills are the must-haves of an efficient dental office manager. One area often overlooked as a responsibility of the office manager is that of the clinical area compliance of the practice, or OSHA. If there is a clinical assistant or the doctor has taken over the duties of compliance in this area, it is still up to the office manager to organize and oversee the standard operating protocols and ensure that all are trained in compliance.
1. Gather, copy and file in each personnel file a copy of appropriate licenses and certificates applicable for employment and job duties. Check at each anniversary for updates of these documents.
Too many times I hear how the office is “so busy” that the annual OSHA and HIPAA trainings are overlooked and easily forgotten. The American Dental Association offers compliance manuals for both OSHA and HIPAA and updates as necessary. These updates are to be included in the annual training session. There are companies that can come in and provide training depending on where you are located and are usually local companies such as OSHA for Dentistry in San Diego, CA. If your HIPAA training took place before 2013 then you are out of date, as many changes have happened that are vital to the security of patient records in the practice. There have also been major changes in OSHA regulation since 2013 such as Aerosol Transmissible Diseases (ATD), digital radiography and laser safety.
As an Office Manager, ongoing training for all staff should be on the calendar with priority attendance required. These trainings are usually about four hours long and are relevant to all staff, whether business or clinical.
OSHA inspections are on the rise, as are the fines associated with compliance breaches. This is not the main concern however - the safety of dental employees and patients is the key driver for ensuring compliance with HIPAA and OSHA.
Want to learn how to organize and prioritize the many and complex duties of an Office Manager? Call McKenzie Management today and sign up for a professional business training two-day course customized to the needs of your practice. Course curriculums can be viewed HERE.
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