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Thoughts on raising your fees

3/25/2019

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 Doctor – Is it time to raise your fees again?
A number of sources recently have reported that dentists are experiencing increasing fee resistance.[1][2] A portion of our colleagues around the country are so insurance dependent that they essentially have no control over fees. While we may be looking changes in the model of dental practice as we move into the future, what can we do now to counteract the continued spiral of increasing fees for our patients and still be realistic about the necessity to raise fees?
We owe our patient the courtesy of explaining all the treatment options available to reach the patient’s desired outcomes and we owe them the courtesy of explaining the fees involved if they want us to use our care, skill and judgement in treatment.  In a fee for service world our fees are controlled by the perceived value we deliver to our clients.
We see far too many dentists working very hard, fearful of annually or semi-annually increasing fees and struggling financially.   Then they have to make a large fee increase to stay in business and wonder why they have fee resistance.  I am totally in favor of making a decent profit for the care, skill and judgement we deliver.  If we are going to stay in business we have to be profitable.  Increasing fees may not be the only solution, especially in an environment of increasing fee resistance.  Everyone is not covered by an insurance plan nor does everyone have money in the bank to cover expensive dental fees.
What can we do as providers to control costs (keep our fees reasonable) for our patients?  I challenge you to answer the following questions before you bump up your fees just because you can or because you feel you have to in order to pay your bills.
Write down your personal philosophy of care and share it with your team.
Determine your production per hour for the dentist and each hygiene team member.  Decide what you would prefer that number to be.  Share this with your team and discuss why it is, or is not possible.  This will be a learning experience for all involved.
Define your true overhead – take out all the doctor perks, superfluous expenses, items used for labor and lab fees.  Carefully evaluate your staff expense – are you getting a good return on your investment? Do you have a real team that is growing and learning?  Are you overpaying for supplies? Each of these questions may lead to other questions that need to be answered.  The goal is to find where dollars are slipping through the cracks.  The small things do matter.  If you can decrease overhead by three percent on a million dollar practice this is $30,000 in profit, five percent would be $50,000.  A good goal according to the Levin Group[3] is overhead of 60% or less.
Look at your schedule for the past three months with your team.  Discuss what things could have been done to make it less stressful, more efficient and more profitable. Do this when you do not have a time constraint as this will very likely lead to some heated discussion in several areas.  If the team decides to make changes put it in writing and do them in small steps with specific dates and times for the team to meet and discuss how things are going.  If this is a new concept to you consider looking into Mike Scott’s Total Accountability Training[4]
 Items every office should be doing:
Schedule in ten minute increments
Schedule in time blocks based on what you want to produce in that block.  Eg. Tuesdays 8 – 12 goal $3,000 – could be crown and bridge, endo, implants or a combination.  Do not fill the block with procedures that don’t meet goals (like urgent care, denture checks or small restorative) until the day before if it is not filled.  Build the production blocks around your doctor’s best work times.
Develop a true business plan – If this is unfamiliar ground talk to a consultant or your accountant for help. Put this in writing for 1yr, 3yr and 5yr increments.  Share this with your team members.
Provide true comprehensive exams, lifetime plans and financial options for every patient.  Learn to do this and train your team by doing this for your team and for yourself.
Provide comprehensive care not one tooth dentistry – go back to school and learn more about doing the parts of dentistry that you really enjoy.  Think about places like the Pankey Institute, Spear or Dawson.  Join a Seattle Study Club group in your area.
Cost is a values based idea.  Fine dining vs. Burger King.    What experience are you delivering in the mind of your patients?  What sort of patients are entering your practice?  What do new patients experience when they enter your practice?  What sort of patients do you want?  Are you willing to make the changes necessary to attract them?
We are training our dental students to think like their medical counterparts regarding fees.  Our new graduates want to demonstrate their skill by doing a procedure but are uncomfortable with the idea that they should have to have a relationship with the patient that will justify the fee that is involved.  This has a great deal to do with how our health care system and providers (doctors, hospitals and insurance companies) have separated the delivery of care from the associated cost of care.  From this thinking we get the concept that everyone is “entitled to care”.  No matter what you are told – there is no free lunch.  Someone is paying for services rendered.  The further you separate the provider from the fees the less impetus there is to control cost. And, the less likely that the relationship between provider and patient is one where the patient will take “ownership” of their responsibility for their own health.
We understand that increasing fees is a part of the business process necessary to remain profitable.  When we raise fees we believe in following the Collier Advisors model[5] of small regular increases that reflect the cost of doing business.  Before you set fees make sure you know your numbers, get your overhead under control, deliver the maximum possible value to your clients and be proud to discuss fees in an open and honest manner.  If you care more about your patients and delivering the highest standard of care you are capable of than you do about money – the money will come.
Blg010819
 
 


[1] Roger Levin, Levingroup.com, Recent lectures, 2018

[2] Marko Vujicics, JADA, March 2018, Vol 149, 167-169

[3] Roger Levin, The Levin Grooup, Recent lectures, 2018

[4] Mike Scott, Total Accountability.com

[5]
www.Collieradvisors.com
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A view on Dental reimbursement

3/19/2019

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Dental Reimbursement
The complicated reality of the third-party payer system
Jeannette DeWyze
Americans who have dental insurance are much more likely to see a dentist1 and take their children in for dental care; they also receive more restorative care and enjoy better overall health.2 The access to care that dental insurance can provide has a clear benefit for patients, but many practitioners are frustrated by a perception that third-party payers are squeezing their practices with reduced reimbursement rates and claim denials.
The economic pressures affecting the profession are certainly complex, but the question remains—how culpable are the policies of dental insurers for flat or declining profits?
Coverage and Participation
Twice as many Americans under 65 lack dental insurance compared to those who are medically uninsured (roughly 67.7 and 32 million, respectively). Nevertheless, some 205 million Americans are currently covered by dental insurance plans—roughly 64% of the US population.3 About three quarters of those plans are private, with the vast majority provided by employers or groups such as the American Association of Retired Persons. The rest receive their coverage from public programs such as Medicaid.
Approximately 100 dental insurance providers currently operate within the United States, 82 of which are members of the National Association of Dental Plans (NADP), according to NADP Executive Director Evelyn Ireland. Since 2000, the NADP has conducted an annual survey in an effort to better understand the scope of dentist participation in provider networks. Ireland says analysis of the most recent (2014) report data showed that more than 95% of professionally active dentists were participating in at least one network.
The NADP data also showed that almost 80% of the dental plans in the market already are preferred provider organizations (PPOs), with more than 193,000 American dentists (an estimated 96% of those who are actively practicing) participating in at least one, with the average dentist accepting 5.7 PPO networks.
Practitioner Perceptions
Despite high rates of participation, some industry observers and practitioners believe that reimbursement rates have declined—with deleterious consequences for practice profitability. “Insurance rates have definitely dropped throughout the country,” states practice management expert Roger P. Levin, DDS, chairman and CEO of Levin Group, Inc. Levin says that based on daily interaction with practices, it seems many dental insurers have reduced their reimbursements to PPO levels. “We believe that eventually all insurance reimbursement will be at a PPO level. They won’t all be in PPOs, but they will be at a PPO level.”
Robert Margeas, DDS, expresses guarded contentment when asked about his experiences with dental insurance. His Iowa Dental Group, based in Des Moines, Iowa, focuses on comprehensive restorative and implant dentistry and currently accepts benefits from two insurers (Wellmark Blue and Delta Dental). “I’m somewhat happy with the reimbursements,” Margeas says. “It’s not like the medical field where they’re writing off 40% and 50%.”
Still, he points out some limitations. “I can’t always use the highest quality laboratory for maximum esthetics because my reimbursement is not high enough,” he explains. Or sometimes there are problems with claim denials, such as when insurers won’t pay for a crown for a cracked tooth because a crack does not show on the x-ray. “Often getting reimbursed comes down to writing a good narrative for the claim and asking a consultant to review it,” he says. “That’s an extra step for the dentist, but it’s one way to get paid.”
Claims related to cone-beam computed tomography (CBCT) can also be frustrating, he attests. “It’s not common to be reimbursed, even though it’s something that is very useful. But a lot of times the patient has to be willing to pay out of pocket to have that extra care.”
Dental consultant and speaker Christine Taxin says CBCT scans are in fact reimbursable, but it means getting your office on board with medical billing (see sidebar). An important first step toward billing medical for CBCT is getting your unit registered with your state, she notes. Each state has different regulations, but the legwork is worth it not only for billing, but also for the prestige accreditation offers the practice. Once accreditation is achieved, dentists can bill for different aspects of the CBCT workflow, including taking the scan, reading it, or sending it out to be read by a radiologist. There is even a code for reading a scan performed elsewhere, Taxin says.
Another reimbursement problem that factors into practice profitability is the overhead faced by offices. “When you look at the amount of money it takes to clean an operatory, between the OSHA standards and the employees, it’s about $70 just to clean the room and get it ready for the next patient. But reimbursement may be only $36 for a cleaning. When patients are coming in and only wanting what insurance covers, and they have a very small co-payment, the dentist has lost money by cleaning that patient in that chair. You can only do that so many times a day.”
Indeed, Levin deems declining insurance rates to be a key factor affecting the business of dentistry today. “It’s a game changer because it lowers practice production. The only way to offset that is with higher volume,” he says.
Levin argues that most dentists today should be concentrating on converting their practices into extremely well run businesses, something most do not learn in dental school. “It’s a matter of overhauling the practice with excellent systems to maximize efficiency. By putting in highly efficient systems, dentists can see a higher volume very comfortably, efficiently, and with low stress to compensate for the lower insurance reimbursements.”
 

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