by Sally McKenzie, CMC
Tink, tink, tink, tink ... tink, tink ... tink. Do you recognize that noise? It's a faint, chiseling sound that's been nagging at you for the longest time, but, like many doctors, you've dismissed it as an inconsequential annoyance. Not to worry, you tell yourself, I'll check it out later. It's not a real problem, just a little clog in "the system."
No, it's not a problem at all, until you realize that it is the sound of your practice slowly and deliberately being chipped away. Management systems are breaking down, and, before you know it, you might just as well have a sledgehammer pounding away at the inner workings of your practice. Business is taking one slam after another, collections have hit a new low, patients are jumping like lemmings from the cliff, and you have more creative financing options than Billy Bob's used car lot.
"How did this happen?" asked my friend, Dr. Smith (not one specific individual, but representative of the many doctors I have worked with over the last two decades). He was in utter disbelief when he came to the realization that some of his key systems had sustained a series of damaging blows. Unfortunately, the practice-management infrastructure can fail you before you even recognize there is a problem. The signals of practice breakdown are never as obvious as their detrimental effects. They often are subtle, gradual changes that can quickly be lost in the day-to-day bustle, personality struggles, communication snafus, staff changes, etc. Well, it's time to patch up the ceiling and replace the floorboards. Let's start by examining where things began to crumble for Dr. Smith.
As you have most likely discovered through your own continuing-education experiences in the "School of Hard Knocks," new personnel can significantly influence your practice's systems. Dr. Smith hired the effervescent Michelle to serve as collections coordinator and patient scheduling coordinator. He was certain she would be absolutely delightful. After all, she replaced Fay, who was good at what she did but had the personality of a chimney brick.
Unfortunately, all the perky pleasantries in the world couldn't offset the fact that under Michelle's watch, collections drifted from 99 percent to 86 percent. Patients were amazed by the fact that, most of the time, Michelle never even asked for payment. What a deal! Sadly, Dr. Smith's office had no financial policy and promised — but never provided — training for Michelle in how to handle payment from patients.
Then there was the matter of delinquent account follow-up. Fay always seemed to have plenty of time to manage delinquent account calls, but Michelle was just too busy "building rapport" with patients and staff. Revenues were spiraling, and, if that weren't bad enough, the recall system fell into total disarray within eight weeks of Michelle's arrival.
Her short, disastrous tenure in Dr. Smith's office could have been avoided. She was clearly a poor fit for the job she was hired to do; she may possibly have performed well in a position more suited to her personality. However, Dr. Smith found that out a little too late.
Personality is a factor to be considered for some, if not all, positions, especially those dealing with practice finances. Some people are very uncomfortable asking for money. They find themselves caught between the patient's perceived feelings and what is in the practice's best interest.
I strongly recommend personality testing for applicants to identify which candidate has the best temperament for each position. The Keirsey Temperament Sorter Test, found in the book Please Understand Me by David Keirsey or online at www.keirsey.com, is an excellent tool for placing current and prospective employees in positions for which they are best suited. Beyond personality issues, employees in certain positions — particularly those involving collections and scheduling — must have the tools and training they need to succeed. They also must be expected to meet specific performance measurements.
In Dr. Smith's office, Michelle's personality was not suited for the position, but there were other obstacles as well, including the absence of a financial policy and a lack of training. She was not given a carefully crafted script to guide her in what to say and how to approach patients for payment. Until Michelle came along, Dr. Smith never realized how important a written financial policy was, let alone staff training in collections. Those factors and more spelled failure for Michelle and serious consequences for the practice.
Dr. Smith's zero percent financing option
In Dr. Smith's practice, patients were not held accountable for payment. After Fay left, many patients assumed they would just be billed. Then they could make whatever level of payment suited them. It quickly became apparent to Dr. Smith that a financial policy was essential for both the staff member in charge of collections as well as the patients.
Take time to establish or review your own financial policy, and keep a few points in mind as you do:
• Establish a financial policy that you are comfortable with and stick to it. Staff input is valuable, but as the owner and CEO of your business, you must decide what is in the best interest of your practice. If you allow credit options for patients, determine how long you are willing to wait for payment. A policy that is too lenient is a liability for your practice. A policy that is too strict is a deterrent to your patients.
• In lieu of extending credit to patients, partner with a patient-financing company such as CareCredit™, Dental Fee Plan, or HELPcard. Offering payment options for patients not only allows you to collect what you produce, but it causes production to increase. Patients now have a means to pay for procedures that they may consider to be costly.
• Consider offering a slight adjustment in your fees for more costly procedures that are paid in full. Refer to this as a reduction in the fee, not a discount.
• Require insured patients to make their payments when services are rendered.
• Do not allow postdated checks. They amount to lots of money in a drawer and not in the bank.
• Avoid providing a menu of payment plans for patients to choose from.
• Give patients the opportunity to pay in full within 30 days before assessing a financing charge.
• Provide employee training on how to handle delinquent calls and enforce your practice's policy. An enforced financial policy ensures that both collections and production improve.
Booked into infinity and beyond
Scheduling is another major factor that can cause a practice to thrive or dive. The last time Dr. Smith saw Mrs. Dennis was when she was expecting her third child. Now Joey is in preschool. Where did Mrs. Dennis and her three children go? To the practice down the street, of course, where she doesn't have to wait six months to schedule an appointment for herself or her children. With her own business and three very active children, Mrs. Dennis couldn't begin to tell you what her calendar looks like six months from now. The hygiene schedule in Dr. Smith's office was booked seemingly into infinity and beyond, or at least well into the next six months. Unfortunately, no one was monitoring the number of cancellations and no-shows. Worse yet, no one was following up with errant patients to get them back into the schedule. And where would the staff put them anyway? Consequently, while the schedule was packed solid, production was sagging.
Scary as it may sound to practices that blindly rely on six-month scheduling, it's time to drop this antiquated, ineffective system. Sure, it's low maintenance, but it's also low pay-off. Practices using this technique eke out a patient retention of only 76 percent, and they have a nearly 50 percent higher loss of patients than similar-sized practices that do not preappoint.
• Integrate a new system — At the next appointment, make sure your hygienist clearly explains the need for follow-up "professional cleanings" to the patient. Ask the patient to address the envelope in which the recall notice will be sent. Instruct the patient to schedule his next appointment when the notice arrives in the mail. The hygienist can write a personal message on the professionally written recall letter, referring specifically to that patient's dental needs. Also include an educational brochure relating to the patient's condition in the mailing.
• Delegate responsibility for the recall system to someone who will be accountable for its success and who will have the tools and the time necessary to succeed. As the patient coordinator, that person should be expected to perform these tasks:
• Make a specific number of patient phone calls each day in an allotted amount of time.
• Schedule a specific number of appointments.
• Ensure that a specific number of patients complete treatment.
• Schedule to ensure that the hygienist achieves a specific daily or monthly financial goal.
• Manage a specific number of unscheduled time units in the hygiene schedule per day.
• Measure patient retention every 30 days.
A good patient coordinator should be able to manage a patient base of 500 to 1,000 on an average of 15 hours per week. It doesn't take much to figure out that reactivating a few inactive patients pays for the position quickly.
• Monitor the system regularly — at least every 30 days. Establish clear goals for your patient-retention plan and designate a specific person to be accountable for its success.
Practice systems don't break down over night. It is a gradual process that can be caught well before significant damage occurs. The key, however, is to monitor the systems continually. Monthly evaluation will enable you to see trends and address problems before they become crises. Keep your eye firmly focused on the practice you are trying to build and take a close look at whether your systems are providing a solid foundation for that growth. Don't let everything you are working so hard to build be slowly and deliberately chiseled away because of ineffective and outdated systems.