What is a Lack of Confluence?

What We Have Here Is a Lack of Confluence: As you know, the outcome you can get for your patient is so often a matter of their choices, not “just” your clinical skills. Put another way, if you could give your patients a magic pill that would have them understand, value and act on Dentistry to the same degree you would, it would do more for them than if you took a magical pill to further enhance your clinical skills.

In every practice there is a gap between what you can do for patients and what they choose to have done. This can lead to frustration, compromised care and tens of thousands of dollars in lost income per year.

It may give you some comfort that you’re not alone. This is common to all health care. Just looking at pharmaceuticals:

• According to Reuter’s, 22% of prescriptions are not filled, 28% are first time prescriptions (this was a study based in Massachusetts of 75,000 patients).
• From Consumer Reports (2007) in a large study of over 79,000 people, fully 3/4 who got a prescription in the previous 12 months said they had not filled a prescription, skipped a dose, forgot to take a drug or had taken less than the recommended treatment.
• Furthermore, 25%–50% of the people with diabetes, high blood pressure and high cholesterol stopped taking the medications as directed within a year.

All of this costs millions and millions of dollars and immeasurable loss to people’s health. In medicine the term they used to use was “patient compliance.” Nowadays, the phrase used is “confluence.”

Once you and your staff really own the fact that patients’ choices are critical to the quality of the care you can deliver, you will automatically start investing more and more of your energy and time into patient communication and other items that will help to positively influence their behavior. This affects your decisions regarding Continuing Ed, the technology you use (buying that intra-oral camera or CAESY for example), and even the staff you choose (obviously you want staff people who convey a positive attitude, communicate well and enthusiastically believe in your/their Dentistry).

There is just as much or more range of services delivered per patients between dental offices as number of patients seen. If you want to produce more, you have to see more people or do more for the people you see. For most of you, doing more for the people you see is the quickest and most satisfying way to growth. That growth gives you the resources (income) you need to further invest in the practice (e.g., practice advertising, website, technology, staff, etc.).

The care should drive the numbers, not the other way around.That is, if you and your staff have “Clinically Calibrated” so you’re in agreement about what criteria calls for the various sorts of treatments (everything from crowns to x-rays), the numbers will move! This approach is the opposite to using “quotas” where the numbers drive the recommendations.

Patient confluence is important but as important is making sure that you and your staff are presenting your best options in the first place. Ironically, more patient care is not delivered because of providers’ fear of rejection than actual patient rejection.

The truth about getting new patients on the internet

Getting New Patients from the Internet (continued): In the “old days” of dental advertising, we had the hassles of dealing with decisions regarding which Yellow Pages to be in and Yellow Page ad design, and negotiating rates. Or planning direct mail campaigns (demographics, offers, mail lists). Those mediums could be plenty expensive but they weren’t all that complicated to figure out.

Internet marketing is a whole different ball game. It can be less expensive (or not!), but it certainly is more complex. Every day you and I are getting bombarded by pitches for SEO, SEM, and this or that great new Internet marketing scheme. I know that getting new patients is important to you so you better believe that we at APM are keeping our eyes open as to what is working, what is not and what the industry trends are.

You have limited amounts of time, energy and money to spend on advertising (not to mention doing dentistry and keeping your patients and staff happy), so we understand that dealing with the nuances and sorting through the hype of Internet marketing can be overwhelming. I’m hoping these articles will help.

Souping Up Your Internet Presence: Stage I – Establishing Your Google Places Page & Cleaning Up Directories: When a potential patient searches for a dentist in your area, they are most likely doing a Google search for “dentist in Your City” or “cosmetic dentist in Your City.” Their results will list three to eight dentists’ in the local proximity who best match their search keywords. Clicking on the links for those dentists will take them to their Google Places page, a miniwebsite of sorts listing contact information, office hours, photos, driving directions, areas of specialty and, most of all, credible reviews from actual patients.

An absolutely essential first step is to claim and enhance your Google Places page, complete it with information, photos, videos, if available, and then to collect reviews. Some Doctors have multiple Place Pages, for example, and that does not help you get found and, in fact, can hurt you. There is often inaccurate information on these directories. We’ve seen completely wrong phone numbers, old addresses and many long-established practices that are virtually invisible when you try to find them on the Internet. So the first step is getting your presence in the multiple directories straight. This also includes adding pictures and other content on your “Place Page.” A very important part often is getting patient reviews posted.

Then, we want to submit your practice information to the search engines and directories that are getting traction in your area so that your information is consistent across the board and you have the best chance to be featured in this suggested list of dentists. We correct inaccurate information, eliminate duplicate listings which dilute your presence and help you to establish a consistent and broader footprint across the web. We call this first stage “Cleaning Up The Directories,” a very detailed but absolutely necessary task.

Stage II - Website Enhancements: The footwork of “Stage I” will increase your visibility in the local directories and get you impressions and, hopefully, clicks through to your website. Then, once they get to your website, it’s a matter of engaging the potential patient and moving them to make an initial contact by e-mail or phone.

A lot is involved, whole books have been written about this. Best practices for effective websites include having a call-to-action on the home page, pictures and bios of the doctor(s) and staff, video brochures, patient testimonials, and before and after pictures. This also may include introductory offers such as free or low cost whitening, a low cost complete kid’s check-up, or other type of offer similar to what you would see with direct mail advertising.

Different than the SEO methods that were popular a few years ago to load each page with all of your keywords, effective websites today strategize a purpose for each page and align the keywords, content, tags and descriptive code with that message. As they say, “Content is King.” This is also an important part of Stage II.

Stage III – Widen Your Internet Footprint: Once the housekeeping is in order, you can start expanding your presence on the web by adding content and through blogging and social media (Facebook, Twitter) or through paid advertising (such as Google Adwords Express or Pay -Per-Click) and special advertising promotions (Groupon, Living Social). With a little organization and persistence, your efforts will pay great dividends in expanding your presence on the Internet and attracting potential patients who are looking for a great dentist!

Putting It All Together:

New directories are constantly coming on to the scene and existing directories update and cross check information sometimes sending bad data around like a virus. Most practices need at least some directory work. You should be checking your listings periodically to make sure they are still accurate. You may have paid your website company to help you with directories at one point, but it’s been our experience that they are often like bad painters. They’ll throw some stuff together but not really pay attention to the details and therefore, some potential patient traffic is lost. Or, you may be already getting a decent amount of traffic to your website but the website itself needs work. Perhaps it doesn’t really reflect the nature of the office (i.e., it looks too “cookie cutter” or too “Plain Jane”) and doesn’t really give the patient a reason to e-mail or call you.

The devil is in the details. Just the technical nuances in getting the directories straight, the organization of the website and its pages optimized, pictures uploaded, patient reviews, etc. can be a daunting task. But again, it helps to have your priorities. For example, it doesn’t make sense to have a graphically beautiful website if the directories are haphazard and you get very few impressions. And, it doesn’t make a lot of sense to spend time on Facebook and doing blogs if you don’t have your website in order so that as you get interest, people can learn more about you in such a way that they’ll want to become new patients.

Our clients work with the whole gamut of website providers…everyone from their sister-in-law to the big generic companies like Officite and Prosites. It’s been our experience that website providers are happy to take your money each month and not really do much. That’s why we brought Kelly Larson on board. Her job is to “ride herd” over website companies and to keep us and you absolutely up-to-date on what is really working in Internet marketing.

I’ve met people with more technical knowledge of HTML programming. I’ve met others who are great graphic designers. I’ve certainly heard from others who are great sales people. I’m approached about new Internet marketing schemes almost every week. I have not yet met anyone who really knows as much as Kelly Larson does in terms of the nitty-gritty of all this, focused on getting new patients through your door. Whether you are just getting started or already have a sophisticated Internet presence, she can give you a push and help keep you ahead of the competition.

Trends to watch

Trends: Matt, Shelly, Robyn and myself make over 600 onsite visits per year. Here is an informal list of trends that we are observing:

1) Multiple location group practices (e.g., Midwest,Heartland). See our previous newsletters on this. (They are online at www.AdvancedPracticeManagement.com under “Dental News.”)

2) More GP’s doing ortho. For example, about 22% of offices now offer Invisalign.

I remember my travels to Outstate MN over 20 years ago when lots of GPs did ortho but that faded. It’s coming back now with the new technology and approaches.

3) Technology in the Operatories: Over 60% of Dentists have digital x-rays and in-operatory computer monitors. Add to that Laser Caries Detection (45%), Intra-Oral Cameras (65%), Patient Education Technology and Lasers.

This technology can easily run $14,000+ per operatory and that’s in addition to your clinical delivery equipment (chairs, dental units, etc.). So, you have to get “Result Control.” See the article on this at www.AdvancedPracticeManagement.com.

4) More Delta Participation: In 2004, provider Delta Premier participation was down to about 81%. Nowadays, 87% of area practices are with Delta Premier. With Delta continuing it’s domination of the dental market, it can be quite challenging for Doctors to be outside the network.

Another 31% of Dentists are with a “Delta within a Delta” (Delta PPO). In our opinion, many practices with Delta PPO do not need to be with Delta PPO… and it costs them thousands. Essentially, their Delta write-offs are almost doubled and there isn’t enough gain (in our opinion) to make up for the write-offs. Likewise for Met Life.

Other PPOs such as the Premier Group, Health Partners, etc., pay fees more akin to regular Delta Premier and, if an office is running efficiently, the bottom line can be fine.

5) The Internet as a Source of New Patients: I’ve seen several instances this year where the Internet had overtaken the Yellow Pages and other sources (e.g., Direct Mail) in the number of new patients brought into offices. This is not universal. In some places Yellow Pages are still pulling. Visibility (signage) remains a very major factor. Of course, so are patient referrals which still account for 50+% of most office’s new patients.

6) Treatment Coordinators: A treatment coordinator is usually a hygienist or an assistant who presents treatment all the way from the x-rays through to the financial arrangements. The most ready model for this is orthodontic offices who have had treatment coordinators for years. The Doctor looks at the treatment plan, the treatment coordinator goes through it with the patients, holds their hands and works out the financial arrangements.

It’s easy to hire a hygienist and plug them into your operations. Developing a treatment coordinator is a little more tricky. It is a less defined job description. It takes a unique set of skills (a good dental background with good communication skills) and can be hard to work into your routine if you are not used to it. However, when we see offices with treatment coordinators, they do well.

This is by no means a comprehensive list but the trends mentioned are worth your attention.

Front Desk Collections:— A Statistical Snapshot

	AVG	75%ile	95%ile
Front Desk Collections as a % of Production	33%	38%	59%

It’s not just about the money! Our client base averages 33% front desk collections. Collections at the time of service can reduce billing costs and of course eliminate completely the chance of not collecting! However, the real benefit in increasing front desk collections is in increasing patient commitment. Low front desk collections are a sign that conversations are not happening about treatment costs and insurance at the front desk.

In every office there are situations where the Doctor and hygienist recommend treatment and then are surprised to find out later on that the patient didn’t schedule or cancelled. “I thought they understood completely why they needed to get this stuff done now…” So sometimes the Doctors can feel that the front desk isn’t able to field the treatment they are sending their way.

Of course, the front desk isn’t the only possible culprit here. It’s a matter of getting the patients to the front desk with the right information at the right time so they can do their jobs. If your front desk collections are under 33%, they can be better. We can help! We coach teams on this all the time. As front desk collections go up, watch, your crown and bridge will too!

$25 Million per month in Perspective:
(from the APM Database)
Each month we collect data from offices all over the Upper Midwest. The collective productivity of these offices is over $25,000,000 per month. That’s a lot of data. How do we make it useful? We can look at Hygiene Production per Hour, Doctor Production per hour, Crown and Bridge, New Patients, Down Time, etc. All of these statistics give you a very real perspective on how much you can expect from you and your staff. What is possible and what is a stretch.

Here are some key statistics from the recently compiled 2010 data:

		Metro Area
	Average	75%ile	95%ile
Dr. Production per hour	$589	$665	$825
Hygienist Production per Visit	$138	$148	$167
Collection Percentage	85%	87%
Accounts Receivable Ratio	1.04	1.22
Front Desk Collections	30%	35%
Production per Active Patient per Year	$677

		Outstate Area
	Average	75%ile	95%ile
Dr. Production per hour	$453	$509	$681
Hygienist Prod. per Visit	$117	$130	$138
Collection Percentage	91%	95%
Accounts Receivable Ratio	1.1
Front Desk Collections	36%	40%
Production per Active Patient per Year	$519

Obviously, if you increase your and your hygienists’ production per hour, all things being equal, you’ll make more!

You can increase your production per hour (capacity) by looking at the main factors that go into determining it such as:

1. Staffing, Delegation and Teamwork: Presumably, with more staff working together that you delegate more to, you can do more than with less staff not working well together that you don’t delegate to!

2. Treatment Plans and Procedure Mix: If you’re doing Quadrant Dentistry or higher end procedures, you’ll produce more than if you’re doing patchwork all day. If you went to CE for cosmetic, ortho, implants, etc., use the techniques.

3. Facility, Equipment and Technology: With more rooms, better equipment and more advanced technology, you can get more done than with fewer rooms, less equipment and less technology.

4. Clinical Speed: Not the biggest factor. The “time on tooth” for dental procedures between dentists isn’t all that different. There are exceptions though, for example, with Cerec. Some Dentists (through delegation, training and experience) can complete the whole procedure in 1 hour. Others need 2-1/2 hours.

5. Appointment Book Control/Scheduling: In most offices, the schedule is simply a list of patients coming in. Make your schedule a planning tool and you’ll profit accordingly. If you take care of each day, the months and years will take care of themselves!

This can involve setting a production per day goal. I’m sure that you’ve all heard of this many times. The goal has to be realistic though and really designed to leverage the resources you have. For example, often Doctors have two assistants but don’t make full use of them. For that second assistant, you have to comfortably see at least two more operative visits per day than you would if you only have one. If you don’t, your overhead is going to be above industry standards.

You don’t have to be booked out a long way to increase your hourly production.
Good planning can make sure that every day is more productive. Plan your “Perfect Day” and block it out accordingly. Sure, you’ll rarely attain “perfect” but if you start putting together each day with a plan you’ll end up with more good days!

If you haven’t already worked with us to do so, it’s time to set your statistical targets for the year. Then we can work back to your and your hygienists’ production per day and hourly goals. Let’s give your staff a little direction on how to put those days together the way you want them.

Group Practice: Doctors, You Are Sitting on a Gold mine

Step outside, please.

If you can step outside yourself for a moment and look at your labor as a Doctor separately from your role as an owner, you can see what a desirable investment your dental office is. Now let’s look at key points in increasing the profitability of a practice (whether you own just one or 20):

1. Hygiene productivity makes a big difference on the bottom line. Your sweat aside, it’s largely where the profit of ownership comes from!

An approximately $10 per hour (or patient visit) increase in hygiene translates to an almost 10% increase in profits. The average hygiene production per hour is $139 in the Metro Area and $122 for Outstate. Why would any Doctor (owner) in his right mind pay market rates for hygienists that are producing at less than the market?

2. Lower Costs: Some of these group practices have negotiated better prices from the supply houses and labs.

3. Negotiating with PPOs: Because they have a network of practices, they are sometimes able to negotiate better reimbursement.

4. Standardized Systems, training and supervision.

5. Serious Business Ethic: These groups are less tolerant of sub-standard performance than private practitioners often are.

Your Advantage:

You don’t have the group buying or bargaining power that these large groups do but you have one key advantage. You’re an on-site owner! You are totally invested in your practice, both financially and personally. And one more thing, you have the best management team in the upper Midwest (if not the country) eager to support you and add to your success (us). Our depth of experience and perspective in advising and receiving data from over 200 offices gives you a powerful ally in the marketplace.

Our Job:

Group practices aren’t the enemy, but as long as you own your own practice, you are competing with them and their economies. It’s our job to help you continue to thrive in an increasingly competitive marketplace.

So, relish the fact that you own your own business. Be resolved this year to leverage our recommendations and your business systems into greater profits.

Be resolved to let your staff know that you want them to be happy and focused. And, be resolved to hold them accountable for working the systems as planned and be resolved to reward them well for performance.

You and your staff will prosper in direct proportion to how well you follow through on our advice.

The Growth of Multi-Location Group Practices

Like Arby’s?

Years ago we thought the trend would be franchise practices in retail settings. It hasn’t exactly happened that way but there has certainly been a growth of multi-location group practices.

In most cases, the model is less formalized than say an “Arby’s.”

Of course, there are the more “corporate” type of large clinics in multiple locations, such as Metro (37) and Park (23).

But, if you look at the recent activity in the Midwest, what you see are groups such as Midwest Dental and Heartland (word is Heartland is coming to our area). Midwest Dental owns more than 77 upper Midwest practices. Heartland (centered in Illinois) has about 300.

Then there are smaller multiple location groups such as Main Street Dental (5 locations in southern Minnesota) and Family and Cosmetic Gentle Dentistry (12 locations) in the Metro area.

There are other niche-type practices such as The Smile Center (7) and Emergency Dental Care U.S.A. (7 Nationally).

Midwest Dental and others are eager to buy and they’re growing. Heck, Heartland Dental even owns a corporate jet! You have to be making some serious moola to have one of those. Let’s take a look at how some of these groups do it.

The Economics of Multi-Location Group Practice

Purchasing a Practice:

Example:
Practice/Collections/Month	$100,000
Practice Operating Net per month (at 36%)	$ 36,000
Dr. Production per month (2/3 of $100,000)
Non-Owner Dr. Compensation	$ 66,000
(30% after lab and write offs)	$ 19,800
Practice Sale Price (36,000x12x1.75)
Debt Service/Mo. on Practice	$756,000
($756,000 x 8 years x 8%)	$ 10,687
The Pay Off:
Practice “Operating Net” per mo.	$ 36,000
Doctor Compensation	$-19,800
Debt Service	$-10,687
Operating Profit/mo.	$ 5,513
Annualized:
Operating Profit	$ 432,000
Doctor Compensation	$-237,600
Debt Service	$-128,244
Operating Profit Per Year	$ 66,156

The Bottom Line:

For an outlay of $128,000 a year in debt service, the owner(s) receives $194,000, a 50% Return on Investment. Where else can you get that kind of R.O.I?? So what seems to be on the surface a sort of slim net of about 5%-6% on collections per month when leveraged really adds up over the course of the year. Now add to that some solid management for practice profitability and growth and the numbers really pop.

Profitability and Overhead Control

Another Word about Profitability and Overhead Control

Want to make sure your net is good?

1. Overhead Control really consists of: Confrontation: Often, reducing overhead comes down to confrontation such as:

• Bargaining with your lab guys.
• Holding your staff accountable for results (given the correct direction and training— that’s our job to help).
• Terminating staff members who are not performing well.
• Making sure you are price shopping and bargaining when making any significant investments in technology, facility, anything.
• Enforcing work place rules (time clock, reasonable vacation time and coordination).

1. Result Control: Making sure that for whatever technology, equipment, facility or advertising you invest in you get a good “bang for your buck.” Please see the “Result Control “articles I’ve written regarding this on my website (under Articles) AdvancedPracticeManagement.com
2. Keeping an eye on the numbers. You can’t manage what you don’t measure and many dental offices have Profit and Loss reports that don’t clearly show the bottom line and don’t organize the expenses into rational groups that make it easy to compare to industry standards.
3. Wise selection (or de-selection) of PPO participation to limit discounts.
4. Increasing practice productivity through seeing more patients or doing more for the patients you see.