Dental insurance is a scam. There, I said it.
A few years ago, PPOs were the go-to dental insurance plans for patients. But times have changed. Today, membership programs are becoming increasingly popular with both patients and dentists. Here I'll discuss five reasons why it might be time for your practice to drop PPOs and build a membership program.
A look at some stats
According to the Centers for Disease Control and Prevention and Vox magazine, 127 million Americans have dental insurance. This leaves about 180 million to 200 million who do not have dental insurance coverage. It could not be a better time in the US to cut out PPOs and grow a membership program.
PPOs offer patients a large percentage discount (typically about 50%). But that's not always a good deal for practice owners. In fact, when you're forced to accept those discounts, it can hurt your bottom line and the perception of quality for the services you provide.
Membership programs, on the other hand, offer much smaller discounts (typically around 10%–20%). But because there's no negotiating involved, the dentist and patient know what they're getting from the start. This leads to less confusion and frustration for everyone.
Another advantage of membership programs is that they’re often more affordable for patients. In many cases, memberships cost about the same as a patient's monthly PPO premium. But because membership plans offer more comprehensive coverage, patients end up saving money in the long run and spending more with your practice.
Finally, membership programs allow dentists the freedom to provide the best possible care. When you're not beholden to insurance companies, you can focus on what's really important—providing quality dental care that meets your patients' needs.
What is a dental membership program?
A dental membership program is an annual subscription that provides patients with access to preventive, routine, and/or urgent dental care at a fixed monthly or yearly subscription fee. Think a Costco membership but for dental patients.
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It's time for fire the PPOs
Generate recurring revenue to increase your practice’s valuation
One of the most important benefits of a membership program for your practice is that it generates recurring revenue. Most dentists will find that this recurring revenue allows them to budget more easily and provide a steady cash flow. Also, because membership programs require patients to pay upfront and automatically, there is less paperwork and hassle involved in getting reimbursed by insurance companies.
Membership plans typically have higher retention rates than traditional dental insurance plans. Once you enroll patients, they’re more likely to stay with your practice for the long haul.
5 reasons you should make the switch
Membership programs help build self-reliance. When you offer a membership program, patients pay the practice a set monthly or yearly subscription fee. This recurring revenue stream can be a lifesaver for dental practices, especially during famine months or economic downturns.
Membership programs attract and retain patients. Patients who are members are more likely to stay loyal to your practice and refer their friends and family.
Membership programs are a great way to increase profits. By charging patients a monthly fee, you can generate significantly more revenue than you would from accepting insurance plans. Member patients spend three times more with your practice than non-members. This means that you generate a predictable recurring revenue stream and expand revenue per patient.
Membership programs are a great way to build patient relationships. When patients become members, they form a close connection with your practice. This can lead to increased loyalty and referrals.
Membership programs are the future of dental care. As the insurance industry continues to change and become less beneficial for patients and practices, it's increasingly difficult for dentists to rely on PPOs for revenue. Membership programs provide a sustainable solution for practices looking to survive and more importantly, thrive.
If you're looking for a way to reduce your dependence on PPOs and build self-reliance, I urge you to consider offering a membership program. These offer many benefits and can be a great solution for practices struggling in today's environment. If you want to learn more about dropping PPOs and growing a membership program, watch my "Fire the PPOs" course.
