Dental Practice Financial health begins with Production; the codes and fees billed for dental and hygiene procedures performed on the patients by a provider.
Collection: the deposit of monies owed for the treatment in a timely manner or via an outside financial partner.
Profit: is what is left over after all the fixed and variable costs are paid for the business. The 35-45% cash flow supports the owner’s lifestyle while continually adding to maximum value for future practice and career choices.
If the COLLECTIONS are not improving or growing, then NOW is the time to respond and identify what is causing your collections to be down.
Questions related to Production and Collections…
* When was the last time you reviewed/updated your fees?
* What feedback have you heard from patients when you adjust your fees?
* Where do you feel your fees fall in the national/local averages?
* How much does each provider produce per hour?
* What percentage of your revenue is generated from hygiene?
* How do you follow up on outstanding dentistry?
* How much dentistry do you think is sitting in your charts?
* What type of procedures drive the majority of your revenue?
* What percentage of your dentistry is accepted?
* How many new patients do you get per month?
* What is your accounts receivable? What percentage is over 90 days?
* How do you think loss of dental insurance benefits will impact your practice?
The collection goal is to collect 95% of what is produced and, if this is not happening, some common CAUSES may be:
Lack of a dedicated team member to collections
Practice is signed up for too many fee-reduced insurance plans
No system for collection of insurance claims
NO written flexible financial options
Not partnering with a third party financing company
Not collecting at time of service
Sporadic sequence to sending out statements
No follow through systems for accounts receivable
NO signed financial arrangements