Tracking key numbers
One of my favorite movie scenes is from “Wayne’s World.” It is the scene where Noah Vanderhoff...
One of my favorite movie scenes is from “Wayne’s World.” It is the scene where Noah Vanderhoff, the owner of a chain of video arcades, confides that his favorite game is called Zanthar. It is a game where the player can never ascend to the next level so “the kids keep pumping in more quarters.”
I teach a practice-management course for the senior class at Indiana University School of Dentistry. At this time of year, the burning question most students ask is, “How much should I be paid as an associate?” They usually are trying to compare their opportunities with some salaries they have seen in the want ads of the ADA Journal or the rumored rate at “corporate dentists of America.” Is a guaranteed salary of $70,000 enough when you can find advertisements offering $100,000 and more?
The simple answer is it doesn’t matter! You are climbing a ladder. Should the first rung be $70,000 or $100,000? The first rung of the ladder is far less important than the last. What you are making at this point is less important than what you are becoming. The top end of your career is far more important than the bottom end. When you examine your opportunities, do not be blinded by a big starting salary. The most important issue is to know how you can make it to the second or third rung of the ladder. There must be some transparent statistics that you can track that will tell you if you are on the right track. The question of how you can ascend to the next level is defined by a few key statistics which an associate dentist absolutely must track.
Key statistics for the associate dentist
Key statistics for the associate dentist
1) UCR production: This is the total value of all your work without any deductions for discounts. This includes the discounts to insurance companies, your family, or your best buddy from dental school.
2) Adjusted production:This is the remainder you get when you subtract all of the adjustments from UCR production.
3) Collections: The collection percentage of the adjusted production should be 98 to 100 percent.
4) New patients:Track the number of new patients you see as well as the source.
• Internal: These are patients who have been referred by another patient within the practice.
• External:These are patients who you or a staff member have met outside the practice. You gave them a business card or otherwise asked them to be your patient.
• Advertising:This includes patients who respond to Yellow Pages advertising, as well as other practice marketing techniques.
5) New patient potential:This is the total dollar value of the treatment you diagnosed and presented to all of the new patients you saw in the month divided by the total number of new patients you saw. This is your average diagnosis per new patient.
6) New patient value: This is the total dollar value of the treatment accepted by the patients, divided by the total number of new patients seen each month.
7) Case acceptance percentage: Divide the new patient value by the new patient potential. This is No. 6 divided by No. 5.
These are the statistics that can tell you if you are on the ladder of success. The key thing about numbers is that you must compare them to other numbers in order for them to have any significance. As an associate, you must compare your numbers to those of the senior doctor or the group standards. Every statistical area where you are above average indicates you are bringing value to the practice. Conversely, if your statistics are below the average, you are costing the practice money.
Your guaranteed starting salary only matters if you are planning to stay at the starting level. It is far more important to know that there is a pathway to reach the next level. Most well-run practices that are sophisticated enough to be hiring associate dentists will be tracking these statistics. Regardless of which statistics your practice tracks, I urge you to track these seven key numbers for yourself. Do not play Zanthar with your career. Look for an opportunity where there are transparent statistics that define your ability to move to the next level. Track these key statistics for yourself, because they will indicate when you are ready to ascend to the ultimate level, your own practice.
Dr. Michael Gradeless, a 1980 graduate of Indiana University, practices preventive dentistry in Indianapolis with an emphasis on cosmetics and implants. He is an adjunct faculty member at Indiana University, where he teaches the Pride Institute university curriculum of dental management. He also is the editor for the Indiana Dental Association. Contact him at (317) 841-3130 or e-mail to firstname.lastname@example.org.