Friday, April 11
Miami, FL
"Treating Your Practice As A Business"
Miami Marriott Dadeland
1-800-443-2756 Press 7, ext. 6721

Friday, April 18
Baltimore, MD
"Treating Your Practice As A Business"
Sheraton Townsend
1-800-443-2756 Press 7, ext. 6721

Wednesday, April 23
Kansas City, MO
"Getting Paid: New Strategies For Changing Times"
Holiday Inn Holidrome
1-800-800-5820

Wednesday, April 25
Kansas City, MO
"Getting Paid: New Strategies For Changing Times"
Harrah's Hotel & Casino
1-800-800-5820

Wednesday, April 30
Everett, WA
"Getting Paid: New Strategies For Changing Times"
Holiday Inn
1-800-367-4104 ext. 2322

Thursday, May 1
Olympia, WA
"Getting Paid: New Strategies For Changing Times"
Holiday Inn
1-800-367-4104 ext. 2322

Friday, May 2
Long Island, NY
"Treating Your Practice As A Business"
Marriott Uniondale
1-800-443-2756 Press 7, ext. 6721

Wednesday, May 7
Bellevue, WA
"Getting Paid: New Strategies For Changing Times"
Bellevue Hilton
1-800-367-4104 ext. 2322

Friday, May 9
Stamford, CT
"Treating Your Practice As A Business"
Sheraton Hotel
1-800-443-2756 Press 7, ext. 6721

Friday, May 16
Pittsburgh, PA
"Getting Paid: New Strategies For Changing Times"
University of Pittsburgh
1-412-648-8370

Friday, May 23
Boston, MA
"Treating Your Practice As A Business"
Back Bay Hilton
1-800-443-2756 Press 7, ext. 6721

Friday, May 30
Detroit, MI
"Treating Your Practice As A Business"
Crown Plaza Hotel
1-800-443-2756 Press 7, ext. 6721

Friday, June 6
Philadelphia, PA
"Treating Your Practice As A Business"
Holiday Inn Select
1-800-443-2756 Press 7, ext. 6721

Friday, June 13
Cleveland, OH
"Treating Your Practice As A Business"
Radisson Hotel
1-800-443-2756 Press 7, ext. 6721

Friday, June 20
Minneapolis, MN
Treating Your Practice As A Business"
Holiday Inn Metrodome 1-800-443-2756 Press 7, ext. 6721

Whether you end up in the 3% group that is able to fully enjoy the golden years, or in the 97% group that is economically challenged, is entirely up to you. I don't know about you, but I for one have no intention of depending on Social Security for any part of my retirement portfolio. My prediction is that Social Security will eventually be converted to an entitlement program by the time I'm of retirement age, a person will have to prove they have no assets and are basically destitute in order to collect Social Security. I'm not planning to qualify for this prize!! As the owner of a business, I believe that only I can provide my own future economic security and I'm in the process of doing so by actively funding a retirement plan.

If you are not already doing so, then I strongly suggest you start maximum funding of your own retirement plan. Now!! If you are wondering where to get the funds, keep reading this article will show you a source of increased Net Income that you can use to fund your retirement plan.

How do you increase your Net Income at least $20,000 per year without doing any more dentistry? The answer is basically a very simple adjustment, but one that will take a shift on your part to apply. Please allow me to explain.

Measuring Costs

The costs of mailing billing statements are staggering. A recent study reported that it costs a dental office $7.26 to mail a single billing statement. Dr. Tom McDougal of Richardson, Texas has reported that it costs the dental office $10 to manage each active account per month. I think Dr. McDougal might actually be closer to the truth, but whichever statistic you accept we can agree that these costs are significant. With some offices mailing out hundreds of billing statements each month, it is no wonder practice overhead is out of control!

In addition to the direct costs associated with billing, there are also indirect costs of billing as well. One such indirect cost is the time value of money. If you are owed money, you are not able to put these funds to use for you, so consequently this represents an indirect cost. The Commercial Law League of America, an independent research organization, has published some recent data related to the indirect cost of your accounts receivable as they age over time (see figure 1).

This chart demonstrates what a dollar is actually worth to the dental office as an account ages over time. According to the Commercial Law League of America, if it takes your office 31 days to get paid then you are actually only getting 93 cents. If it takes your office 61 days to get paid you're getting 85 cents. Should it take you an entire year to get paid, then you are getting a grand total of 26 cents on the dollar.

Now, combine the direct costs of sending billing statements with the indirect costs of your aging accounts receivable and you can see that the process of billing patients represents a significant cost to your office. Before I suggest my solution, I want to you to sit back, relax, and have an entirely open mind it requires an open mind.

The Solution

My solution is to no longer accept assignment of insurance benefits for hygiene visits. Remember, have an open mind!!

From this day forward, require your hygiene patients to pay for their dental services in full at the time of service. I suggest that you continue to produce an insurance form for your patient, because they do not have the expertise to do so. At the end of the hygiene visit, your front desk team member can provide the patient with a walkout statement itemizing all charges. Your front desk person will then collect this amount from the patient. Then she will hand the patient the completed insurance form and tell the patient they should mail this form to their dental insurance company for reimbursement. Be sure and check the box on the insurance form that assigns the benefits directly to the patient. The insurance company will then mail a check directly to the patient.

Think about what we accomplish with this shift. By collecting payment at the time of service for hygiene visits, you will significantly reduce the number of billing statements your office sends out. A majority of the statements that offices send out each month are related to hygiene visits. Sometimes it is necessary to send out two and three statements until the balance is settled in full. All at a cost of somewhere between $7.26 - $10.00 per billing statement!

Let's not forget the indirect costs of the time value of money. If you collect in full at the date of service, then this time value cost is -0-. Insurance companies discovered the reverse of this trick a long time ago. They learned that if they just kept your money for a few extra days, they could make a ton off the 'float.' If you think the money they earn off the float is inconsequential, then I challenge you to rethink! Insurance companies actually earn hundreds of millions of dollars each year by hanging on to dentists' money a few extra days.

Can You Actually Do This?

Let me be painfully direct. Your patients will not be thrilled with this new approach. They would much rather you bill their insurance and wait for payment. Who wouldn't?? However, the question is not whether or not your patients will like this change, but the real question is whether you will lose patients due to this decision. My experience is that if your payment coordinator is polite and diplomatic and if your office provides exceptional patient service, then this decision will provide minimal upset to your patients. They will not be thrilled with this decision but most will go along with it.

If the patient objects, your financial coordinator should be prepared to overcome these objections. One positive approach is to suggest that the patient charge the visit on their credit card. All credit cards provide a billing cycle and grace period of 25-30 days. Indicate that the patient can charge today's visit on their credit card and they will probably receive reimbursement from their insurance carrier before their credit card bill is due. As a sidebar, please note that all insurance companies will reimburse the patient much quicker than they provide payment to your office. This is because insurance companies prioritize payments to policyholders before providing reimbursement to providers.

Most patients are able to comfortably handle payment of the hygiene visit. Think about it. How much is the typical hygiene visit? It depends on the need for radiographs, but the bottom line is that the total charges for a hygiene visit are manageable. If this payment represents a financial hardship for a particular patient, then you can make an exception. However, it is my experience that the vast majority of patients are able to pay for this visit out of pocket.

For now, I suggest that your office continue to accept assignment of benefits for treatment other than hygiene services. For restorative or operative dentistry, I suggest collecting the patient co-payment at the time of service and accepting assignment of benefits on the insured portion. Later, once you have successfully completed the payment transition in your hygiene department, you may wish to take the plunge and create an entirely insurance-free practice. Or you may decide that this decision is just too radical and stick to accepting insurance assignment for any treatment other than hygiene services.

If you are concerned about negative patient reaction, then focus on increasing the level of patient service you provide. Together with your team members, determine how you can strengthen your relationship with your patients and increase patient service. Ultimately, if you provide your patients with distinct reasons why they should continue visiting your office, even when they are required to pay for hygiene visits out of pocket, then they will not leave the practice.

The Result

This simple, yet significant shift in your office payment policy should result in an increase of at least $20,000 per year (perhaps considerably more) in your Net Income. This savings is realized by dramatically reducing your billing costs and reducing the indirect costs of the time value of money to -0-. Keep in mind that this increase in Net Income will be accomplished without providing any additional treatment.

Your office will also gain efficiency through this process. Because you will save considerable time by reducing the billing process, your team members will now have more time to spend on much more productive tasks, like improving your recall percentage or conducting practice marketing activities. This increase in Net Income could be directly deposited in your retirement plan (without reducing your present lifestyle) and you'll be on your way to the financial independence that you deserve.

One last comment . . . You may have heard the following axiom, "If you only do what you have always done, you'll get what you always got." This saying is particularly true as related to my recommendations in this article. If you are tired of experiencing ever rising practice overhead, or if your present Net Income is not adequate enough to allow for maximal funding of your retirement plan, then some changes are in order.