Moving from Tier III to Tier IV

Nov. 1, 2003
In the past few months, numerous Pankey Institute Participants have asked me how to move from a Tier III to a Tier IV practice. My first response is, "That depends!" .

Richard A. Green, DDS, MBA

In the past few months, numerous Pankey Institute Participants have asked me how to move from a Tier III to a Tier IV practice. My first response is, "That depends!" It depends on what you are presently doing to uniquely individualize your care.

• Are you doctor-centered or patient-centered in your operational systems development?

• Do your systems "assist" the patient or do they "insist" on a certain behavior to "belong"?

Attributes of Tier IV

The following attributes of a Tier IV practice might stimulate some discussion for you and your staff.

• The practice is a low-volume, fee-for-service solo or group practice, compared to a Tier III high-volume, fee-for-service solo or group practice.
• Your patients receive individualized care vs. care defined as Phase I/II care.
• With each patient, you build a unique relationship, not just "enhanced" encounters, and you desire to maintain that relationship for the long term.
• Rather than an administrator of health, you are a health facilitator with a preferred future in mind that is uncovered by the patient through your facilitation.
• The patient doesn't just receive a diagnosis and treatment decisions. Instead, you and the patient are true collaborative partners, co-discovering and interacting to achieve individually optimal and appropriate care.
• Both your core values and the patient's values drive the practice. There is a desire for clarification and communication as you facilitate the patient's assessment of his or her preferred future.
• Ah, and here's a really interesting trait — Your objective moves from a focus on professional growth to one of personal growth and professional growth.
Does your practice have the above characteristics?

The chicken or the egg?

Often I hear the question, "How do I find time to do all this stuff?" Often, the true concern is, "I haven't figured out how to get paid for the time I need to spend." Which comes first, the chicken or the egg?

We all have the same amount of time. In order to move into Tier IV, I believe we need to purposefully slow down, take time, and risk not being paid for it. All the continued research with the Gallup Organization on our Patient Perception Survey shows that taking time to create value through enhanced experience with the patient results in greater patient loyalty accompanied by higher patient satisfaction and practice revenues.

Our data shows that:

1) Doctor revenue per hour increases with patient satisfaction.
2) Doctor revenue per patient increases with patient satisfaction.
3) Patient satisfaction and total practice revenues have a positive correlation and increase together up to $1.2 million after which the correlation turns negative because the doctor is again too busy.

In other words, good things come to those who invest quality time in getting to know the patient first. By investing in the patient, you increase patient satisfaction. As satisfaction increases, so does the quantity of work that patients want you to do over time. At some point in the revenue curve, a practice may become too busy to positively impact patient satisfaction.

What would you rather have — 30 percent of $1,000,000 or 50 percent of $600,000? Our studies of Pankey Participant practices show greater patient gratitude and appreciation among solo practices with a total annual revenue up to but not more than $1.2 million.

If time is an issue, then, the way you schedule and organize your treatment plans can take your practice to another level — but that's another article I look forward to writing for you.

For more excellent motivational tools from Dr. Richard A. Green, please visit

Richard A. Green, DDS, FAGD, MBA, is the director of business systems development of The Pankey Institute and is responsible for developing the business systems and financial-management portion of the Institute's curriculum. You may contact Dr. Green by phone at (305) 428-5547 or by email at [email protected].

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