Bulletin, November 2003
The Latest in Area Economic and Technical Trends
Exclusively to Clients and Friends
of Advanced Practice Management
The Rossi Dental Dow Jones for November:
Through September of this year our Dental Dow Jones is up 6.3% and collections are up 4.5%. Patient exams are up 2.4% compared to 2002 averages for the sampled practices. However, new patients were down slightly (3.6%). Downtime in the Doctor’s schedule is up nearly 25%… about another two hours per month per Doctor of open time.
Out of the 36 practices in the Dental Dow Jones 30 were above of last year’s averages, 1 was about even, and 5 were down.
3M Changes their dental insurance:
Last year 3M switched to Cigna but they provided for good out-of-network benefits so there was little negative impact on practices that have lots of 3M patients (those of you in Woodbury, Stillwater, North St. Paul, Hutchinson, etc.). The word is that in 2004, 3M is going to switch over to Delta Premier. This is probably not a good deal for most of you since you will experience those good old Delta write-offs on patients and services that you did not have to write-off before.
Some Doctors are upset about this because it seems that a company selling high quality products such as 3M could have chosen better insurance options for its employees. Most of you will recall that Delta did not do a lot to encourage the use of composites. Maybe the guys at 3M forgot that.
One Doctor told me he’s tempted to just knock 12%-14% off his next payment for 3M products (a discount similar to what Delta nicks him with). “Hey, we’ve got to implement cost controlling measures too.” Another well known dentist told me he’s boycotted 3M products altogether. He didn’t like it that 3M did not really seem to keep their promises to talk to the MDA about other options before going with Delta.
Personally, I don’t buy dental products but I know that 3M has been a company highly regarded by dentists and I think we all hope that won’t change.
Smart fee setting strategies:
We recently completed our annual fee and wage surveys and most of you already have those in hand. If not, call the office and we will be happy to send you a copy (of course we encourage you to participate but we are always happy to share the results with clients upon request).
For the past few years Delta has decided what percentage it’s going to allow it’s providers to increase their fees at the beginning of each calendar year. So, let’s say Delta allows a 3% increase. You don’t get that increase unless you submit a 3% or more fee increase and you must do the submission within the calendar year. So, the smart strategy is to submit in January for fees that will go into effect in February. If you submit in December (and you’ve already submitted earlier the previous year) chances are you’ve exhausted whatever increase they are going to give you and missed time can cost you a few bucks. So if you are a Delta Participating Provider, make your fee increases crisply at the beginning of each year. If you have already submitted a fee increase for 2003 that is over say 3% then it is probably best for you to not submit new fees to Delta until January although you may want to increase your fees none-the-less. There is no advantage in waiting until Delta approves the fees if you are otherwise due for an increase… not all of your patients are Delta.
Don’t wait until the last minute to renegotiate that lease!:
Well, I’ve seen this happen about three times in the last six months. The Doctors had waited until the last minute to negotiate their lease with the landlords and guess what? The landlords were not very flexible! You simply have no bargaining power at all if you wait until the last minute to negotiate because your landlord knows that you haven’t got a prayer of relocating.
Even if you’re very happy and solidly committed to your current space, the landlord doesn’t need to know that when you are negotiating the lease! If you start negotiating a year in advance or so, it gives you much more leverage. It makes it more likely you’ll get allowances for leasehold improvements or other terms that are important to you. And if your landlord isn’t giving you a fair deal, you might even decide to move.
Speaking of leases, are you sure that your lease is assumable? If something should happen to you and your practice was sold, would someone else be able to assume that lease?
It’s important to get professional help with your lease. It’s a poker game that landlords play all the time and when you sit down at the table, you are at a great disadvantage. So hire someone who’s used to playing the game. I can refer you to help.
If your staff hates to do collection calls:
No matter how diligent you are you will end up with some slow paying accounts. In lots of dental offices, the office administrator is’t willing or able to get on the phone and get in contact with those slow payers. Even then, they may not be willing to work evening hours when they have the best chance of reaching people. And, sometimes great receptionists do not make great collectors.
The typical dental office has somewhere between 20-40 accounts that haven’t paid for 2 months or are otherwise delinquent on their financial arrangements. Check with your front desk person. Has she been able to make 20-40 calls in the last month? Have 20-40 collection letters been sent out?
It’s not just a matter of collecting money, it’s also important to give your patients’due process” so you have the peace of mind knowing that everyone was treated fairly and consistently.
We have help for you. We just brought on board Laurie Knutson. Laurie has over 12 years of experience in dental collection calling. This is not a collection service. She does not play heavy with the patients, yet she is effective in getting payment. Want help? Just call 952-921-3360.