Sow the seeds for fee-for-service and watch your practice grow!
Roger P. Levin, DDS, MBA
Each year, I have the privilege of traveling throughout the world, presenting over 100 management seminars to dentists and their teams. While it is true that different parts of the country have varying demographics and socio-economic factors, most people want excellent dental care and are willing to pay for it. The problems arise when a third party, such as a dental insurance company, establishes the standard of what type of dental care has value and how much it should cost. Patients` perceptions of dental insurance have been molded to some degree by medical managed care. Many people believe that dental procedures should be covered much like medical services are covered. The public, however, is beginning to realize that medical managed care causes significant customer service problems. Moreover, they are witnessing a decreased quality of care.
A growing number of consumers are pressuring Congress for the right to sue managed care providers for poor decisions. The medical establishment has become so dismantled it will never be re-established in its earlier form. Some type of cost containment will always exist.
Dentistry does not have to travel the same path. Every practice has the opportunity to establish itself as an independent, fee-for-service practice, whether you participate in dental insurance plans or not.
The key factor to the success of a fee-for-service practice is patient education. Patients can be taught the value of services not covered by dental insurance. Dental practices can do an excellent job of educating patients about the realities of dental insurance and its relationship to quality care.
An examination of the differences between medical and third party dental coverage clearly indicates that dentistry need not topple to outside forces attempting to control how we practice. Here are three major distinctions:
Most patients have only partial reimbursement for the services covered by their dental insurance plan.
Most dental insurance policies have a maximum benefit, which cannot be exceeded, regardless of the needs or wants of the patient.
Dental insurance companies exclude most elective services provided by dental practices.
These tenets radically distinguish dentistry from medicine. While the dental insurance industry does exercise some control over many practices, it is not pervasive enough in its coverages to have total control. Hence, the fee-for-service practice is alive and well!
Change should come gradually; however, your goal should be to walk into the office tomorrow morning with a fee-for-service philosophy. Many dentists are overly influenced by insurance coverage. They let the plans dictate the services they provide and the fees they charge. We often find ourselves reluctant to stray too far from what the policies provide for fear of upsetting or alienating our patients. "Fee-for-service" seems an impossible strategy to implement.
After evaluating literally thousands of practices, I can assure you that almost every practice can build a significant fee-for-service component regardless of where your practice is today. Fee-for-service practices thrive in rural communities and big cities alike. It`s like being overweight: It doesn`t matter if you are 10 or 50 pounds overweight. What matters is what you look like when you achieve your goal. Each practice must make varying choices and take the appropriate amount of time to achieve its ideal. Knowledge and persistence will get you there.
Any dentist would agree that this scenario is unreasonable. But ask yourselves: What would happen tomorrow morning if every dental insurance company agreed to pay $15 for each periodontal probing and recording? The answer is obvious. We would be influenced by the coverage and begin performing peridontal probes on every patient in our practice as often as the coverage would allow.
The first choice you make in a fee-for-service practice is to present every patient with an ideal treatment plan. A plan has two parts:
(1) What the patient needs.
(2) What the patient (might) want.
Patient needs are obvious: hygiene, X-rays, and diagnosis and treatment of specific problems. Patient wants, however, are more subjective. Linking the two is the key to an ideal treatment plan. A complete diagnosis, complemented by an ideal case presentation, will have an immediate and positive impact on your practice. No patient will ever fault you for telling him or her what is needed on an ideal basis, and what the best treatment is for each situation. Nor will any patient ever be unhappy when you provide them with information about elective options such as cosmetic dentistry or implants. I have found that simply telling patients what is possible greatly increases case acceptance.
What if a patient does not accept ideal treatment? Offer the second option, then the third, then a fourth if necessary. As each option is rejected, offer the next. Our obligation is to inform our patients about the best we can do in any situation, regardless of their insurance coverage.
One key step in building a fee-for-service practice is patient education. Most patients are exposed only to the information provided by employers and insurance companies. This leads to a belief that only covered services are worthwhile. These beliefs are understandable, but they should be addressed and corrected by each practitioner.
In most practices, the information given patients is too technical and fails to explain why insurance companies provide only limited coverage. Educating our patients means giving them the truth regarding dental insurance. The "truth" is not about criticizing insurance companies; it is about clearly informing our patients what dental insurance is, and what it is not. A brochure, for example, can educate patients in a clear manner without taking a great deal of staff time. If worded like the following, a brochure can help patients understand the limits of insurance:
"Dental insurance is a contract between your employer and an insurance company. The benefits you receive are based on the terms of the contract your employer negotiates. Most dental insurance policies provide only for basic care and treatment. The amount of coverage varies, with a typical range of 50 to 80 percent of the total charges. This dental office did not participate in the negotiations; therefore, we have no influence as to how much, if any, coverage your policy provides. Many services necessary to achieve a high quality, complete result are not covered."
This is an honest, impartial explanation of dental insurance. Patients can still use their benefits, with the understanding that they do not restrict the practice or their options. Patients also need to understand why elective services are not covered, why a maximum dollar value of coverage exists, predetermination of benefits, and other factors. This essential information can be handled by using a basic educational brochure, and by training practice personnel to answer any insurance question positively and honestly.
The next major psychological and managerial change to make in you practice should be to challenge the predetermination process. Predetermination is used to find out whether a service is covered by an insurance company, and how much the insurer will pay. Practices dependent on pre-determinations usually have below average case acceptance. This is due to the amount of time it takes for the insurance company to return the predetermination - typically a minimum of six weeks. In the ensuing interval, patients lose their motivation for treatment. Lack of follow-up by the practice further reduces the likelihood of case acceptance. Waiting passively for a predetermination outcome infers to the client that the treatment isn`t necessary. What`s more, it sends the terminal message that the practice simply doesn`t care if the client returns.
Eliminate predeterminations from your practice. Instead, emphasize to your patients that the service must be performed, regardless of the amount of insurance coverage. Inform patients about the delays that come with pre-determinations, and the possible consequences of these delays, including advancement or worsening of their condition. Offer financing alternatives to eliminate any concerns about costs. Encourage your clients to schedule the treatment as soon as conveniently possible.
I think you will be amazed at how many patients will follow through with the recommended treatment. Clients want the coverage due them, but they don`t want the dental insurance company to rigidly control your diagnosis or eliminate their options. Given a choice between health or its opposite, most patients choose health.
A significant component of operating a fee-for-service practice is elective dentistry. As the insurance industry tightens its requirements, it is the elective services you provide that will keep your practice strong. Elective services should equal 20 percent of a practice`s annual gross revenue. The American public is extremely interested in health and beauty. We need to provide them with options for beautiful smiles.
The current emphasis is on cosmetic and implant dentistry; however, a number of other fields, such as treatments for occlusion, are emerging. As practices strive to grow without depending on insurance, the elective services are a strategic factor for success.
It is crucial to understand the importance of case presentation for elective services, which differs radically from that of needs-driven services. Patient acceptance of elective procedures has remained static. Regardless of the outcome, it is still a dental treatment, requiring time, possible discomfort, and of course, money.
Attitudes toward insurance compound the problem. Many clients are unaware of the distinctions between elective and needs- based coverage. Presentations for needs-based services follow a typical pattern. The dentist outlines the treatment, motivates the patient, gains acceptance, and presents the fee. A question-and-answer session then follows regarding how much insurance will cover and how much the client will pay.
Following this scenario for elective services, however, guarantees nonacceptance. Bluntly informing a client at the end of an elective case presentation that insurance will not cover the treatment erects a psychological barrier that blocks further consideration. The client will likely want to "think about it and get back to you." In the meantime, motivation wanes and acceptance is unlikely.
Avoid this scenario by informing every patient within the first five minutes of an elective case presentation that there is no insurance coverage for elective procedures. It may seem like a radical approach, but informing your clients of the one negative (no insurance coverage), followed by a multitude of positives (better appearance, self-esteem, and health) will register in a completely different manner. Your clients will be more open to case acceptance. Keep in mind that with case presentations, it`s not what you say, but how you say it.
The use of patient interaction scripts is an effective way to approach case presentations. I?ve documented their effect as part of a case study, and the results were amazing. Scripts provide a consistent model for making case presentations. They eliminate ambiguity; they also ensure that the dentist and staff give clients all the information they need to make a decision regarding elective dentistry.
I highly recommend a minimum of 8-16 hours of case presentation training for all dentists who are beginning to build the elective side of their practice. With the proper skills, all dentists can feel confident offering elective services, and significantly increase their average production per patient.
Fee-for-service dentistry is a choice. It takes more effort and time ? you must educate your patients, learn how to present cases, motivate patients, and develop outstanding customer service. But with great effort comes great rewards:
- You are in control of your practice, instead of some faceless corporate entity.
- You don?t become a victim of changes made outside your practice.
- You can take pride in the services you provide to your patients, without compromise.
Operating a fee-for-service practice is the most rewarding, profitable and exciting way to practice dentistry today. Make a decision to offer ideal care to each patient and present it in the most enthusiastic and positive manner. You will be happier, and, more importantly, your patients will appreciate the services you provide more than ever.
A word about credit
Be sure to have credit options available for your patients. One way to defray some of the dependence on dental insurance is to make funds available to patients through one of the companies exclusively for dental financing. More and more patients are interested in having dental treatment, but want to finance it just as they do many other things in their lives. Providing an immediate payment solution for patients while they are in your office retains motivation and ensures follow through on treatment. Check with your state dental association for references and information on these companies.