EP04: Who is the Most Profitable Dentist?

Podcast

Should you take more insurances? What kind of a practice would you like to be? On this Episode, Dr. John and Wendy will discuss what parameters create the most productive dentist. Join us on this podcast and discuss what kind of practices are out there, and how YOU can be more profitable.

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EP4: Who is the Most Profitable Dentist Transcript

S1 00:02.153 [music] Welcome to the Double Your Production podcast with the Team Training Institute, the one place designed for dentists and their staff who want to grow their practices by following in the footsteps of those that have done it, or in the trenches, know exactly what you’re going through. And now your leaders, the stars of the podcast, Dr. John Meis and Wendy Briggs.

S2 00:25.702 [music] Hello everyone, and welcome to another episode of the Double Your Production podcast. I’m here with Dr. John and Wendy. I’m your host Katie Smith, and today we’ve got a really interesting topic. We’ve got a lot of doctors who reach out to us for making difficult decisions, trying to keep their practices successful. It’s a really hard battle when you’re trying to decide what kind of a practice you’d like to be, what direction you’d like to see your practice go. I thought we would bring that to the table today, and turn it over to Dr. John with just that question. So Dr. John, when you have a doctor that comes to you and is talking about what kind of a practice they’d like to be, what kind of information do you have to give to them?

S3 01:07.396 Yeah. Well, thanks, Katie. I think the first place is starting out with where they are, and moving from there into where they want to be. And knowing that each practice style, or each practice model, has plusses and minuses to it. And so really, the first thing is to really get a good understanding of where they’re coming from. It has been, for a long time, the kind of gold standard of the practice, or the people that seem to brag the most, are those that have completely fee-for-service practices. And so I’m going to tell you what I know about those practices. So in my role of evaluating buying practices, I was able to see kind of under the
hood and behind the curtain in practices, because I got to see their financial information. And while I did find several fee-for-service practices that we were looking
at investing in, I did look at them, I did find a couple that were doing really pretty well financially. But that’s not the typical. Generally, the smallest of the
practices, and the least valuable of the practices, that we evaluated were practices that were fee-for-service. So there’s several reasons for that. One is that they’re
lower volume. And this area, this style of practice, is the most competitive, the most difficult to pull off, requires the greatest amount of team training and quality,
requires a doctor to be a warm and empathetic and highly polished person to pull this off, in most markets. All right? So I always like to tell a few stories about
some of the practices that I’ve observed. And so if we look at the full fee-for-service practice, one of the things that we know, in rural areas the markets are not
very competitive, and I’d like to say that the streets are paved with gold in rural areas. And so what we find, practices in non-competitive areas, they can keep their chairs completely full without taking any kind of insurances. And so Wendy, when you go off on all your travels, and you’re working with these practices, have you found that same thing that in the rural areas the competitiveness, for the most part, is significantly less?

S4 03:52.838 Yes, absolutely. I’ve found exactly the same thing. And so the strategies that have worked successfully in those areas are often not replicable once you get into a highly competitive market, or even just cross the state line. The ball game changes completely. And they’ve got a completely different set of rules, a completely different set of challenges. And even the players at this are different. What patients want changes dramatically too based on those geographical areas. And so, I’ve seen the exact same thing. And the sad thing, another thing that I often see with the fee-for-service model is that there is a lot of experts in our profession or consultants out there, that that’s their goal is to get every practice to a fee-for-service model strictly, where they start to eliminate insurances as quickly as they can. And in today’s marketplace, sadly I’ve seen that come pretty close to destroying some practices. There’s some really terrible advice for people that say, “Oh, everything should be strictly fee-for-service. “That’s all you should be doing.” And that’s what everyone should be striving to reach is that model because as you said, it doesn’t work everywhere.

S3 05:03.290 So a one size fits all solution, you just know intuitively that’s a bad idea. So one size fits all just doesn’t make sense. So I always like to tell people, if you are fee-for-service now and you’re busy and full and hitting your goals, don’t change it. That is awesome. That’s a, I’m sure, a very nice practice style to practice in. Where people struggle is when they’re not that. They’re either trying to to be fee-for-service but they aren’t full. And that is where we see this. One of the places where we see this tremendous demand for new patients, kind of an insatiable, hungry ghost-type feeling about new patients. So, “I’ve got to have more new patients and more new patients and more new patients.” In a fee-for-service practice, it’s tough to draw new patients in because number one, people want to use their insurance. And so I speak to dental audiences– several hundred people in the room and I ask them, “Who sees a primary care physician who’s not a provider on their health insurance plan?” And always, there’s a couple of hands go up, three, four or maybe five in a room of a couple hundred people. That means all the rest of them have, at least in part, taken whether their doctor is a provider. They’ve chosen a doctor, in part at least, based on whether they are a provider or not. So these are dental audiences. These are wealthy people, highly educated people, healthcare providers. And even they want to use the benefits of their insurance. So the general public certainly isn’t going to be any different than that. They’re going to want to do the same thing. So when we look at the population, if we’re going for the fee-for-service practice, we’re largely talking about people who don’t have insurance. Now, the pie gets thin. And I was at a meeting this morning in Scottsdale. And there is a– it’s a great city of examples. And there are a lot of fee-for-service practices or practices that are trying to be fee-for-service. But there’s just so many of them going– many practices going after this same niche of patients. So it’s a niche model. And if you’re there, fantastic. If it’s working, great. Don’t change it. But if you’re struggling, it may be that your market is too competitive or that your skills aren’t high enough or your team’s skills are not high enough to be able to draw in enough of that type of patient.

S2 07:47.246 Perfect. So if we have a doctor that’s ready to kind of switch and looking at this insurance-driven occupation, what kind of advice would you give to them?

S3 07:58.475 Well, I think the first thing that I’d say is that in dentistry, the more people you take care of the better you’re going to do financially. I mean, it sounds simplistic but it’s really true. And so when we look at flow through a dental office, it’s flow that creates profitability. And so if there’s not enough flow, we know that profitability is going to suffer, and the closer and closer that flow gets to the capacity at that office the more and more profitable the practice becomes. I mean, it’s simple. The more people you help the better off you do. So when we look at practices and they’re not having enough flow to reach their goals, we know that there’s multiple things to do to improve that flow. So one of them is to market more and I’ve had very transformative experience with marketing. Having looked at practice after practice after practice and looking at their patient statistics and looking at the demographics of the practice and looking at their financial results, and I think there was a time when marketing could move the needle. There’s certainly a place for a practice that’s already growing and doing well, marketing may help them some. But a practice that just doesn’t have enough umph, I’m not sure marketing is the most effective thing to do. Wendy, do you want to comment on that?

S4 09:36.534 Yeah. Really, we go through this in detail in our book which you can request a copy of our book on the podcast download page. But in the book, we talk a lot about how you cannot solve an operations problem with more new patients and too often we get sucked into that. And we also talk a lot about you don’t have any patient problem in our first episode, episode number one. So a lot of times I think people think that more new patients are going to solve the operations problem but if you don’t have certain things in place, you’re not going to have the solution that you need by upping your flow. So we’ve got to make sure there’s a process involved. I also have one other thing too, Dr. John. A very common mistake that I see is people misunderstand, they think that increasing the flow of hygiene appointments will increase their revenue. So let me kind of clarify what I mean by that. Sometimes they choose to increase the number of patient encounters in hygiene by shortening appointments down to meet their goals or accomplish their goals. And what we often see is that has the opposite effect that’s desired. We see fewer patient retention. We see a lot more churn and over time they need more new patients because they’ve really chosen to focus on, in my mind, an incorrect strategy. We want to make sure that if we are turning on the faucet and increasing flow, we’re doing it the right way. We’re not shortening the appointments down, minimizing patient experience and reducing our service because really that’s going to have the– the long-term effect of that can be disastrous. Instead, we choose to focus on increasing the production per encounter on the hygiene side. Now we’re talking about flow in general. I mean of course I just wanted to clarify those difference because I think you can be–

S3 11:26.872 Yeah, yeah.

S4 11:27.396 We can follow some really terrible in thinking that increasing flow means shortening appointments down and providing inferior care and that’s not what we mean at all.

S3 11:37.904 No, that’s right. I’m glad you pointed that out because when I’m talking about flow I’m talking about high-quality care provided in an efficient manner. And we know that– and this is quite counterintuitive. We know that a hygiene team that has 60-minute appointments will out produce one that has 40-minute appointments, and will way out-produce one that has 30. So that’s counterintuitive, Wendy. Why don’t you walk us through exactly how that works?

S4 12:12.553 When we talk about maximizing or optimizing production which we talk about quite a lot, we really are talking about making sure that we give our hygienists the right systems and structure to be able to deal with anything to do with maximizing their three critical roles, right? Preventative therapy, [inaudible] therapy, and patient treatment advocate. I can tell you, yes, a 30-minute appointment time means that you will serve more patients throughout the day, but we’re really tying the hands of our patients. Or we’re tying the hands of our hygiene providers when serving those patients, because they’re not able to do any of the same preventative services that can really dramatically increase revenue. So when we talk about having 60 full minutes, hygienists that are trained in the systems that we teach, they way outproduce a 40-minute hygienist, all day long. A 40-minute hygienist does not have time to use internal camera, or [inaudible] lasers. They don’t have time to provide that wow. They often don’t even have time to do the basics like probing their patients. So it’s not uncommon for us to do an audit in these practices that have 30-minute appointments and identify in the last year, they’ve done one or two quadrants of scaling and root play. That’s it. Not on two patients, even. Just two quadrants. I’m really glad, the way you defined it. Flow means providing world-class-level care in an efficient manner. That’s what we’re talking about. When we talk about the different sales of practices, fee-for-service dentists, often I have seen look down their noses at other practices that accept insurance, because they make some assumptions that, in my opinion, aren’t always true. They may sometimes be true, but they’re not always true. If we’re accepting insurance, we are making compromises. We’re compromising the quality of care we provide, because that’s the only way we can accept insurance and still be profitable or successful.

S3 14:06.923 Which is patently wrong, and we’ll probably get to that as we go along here. The other thing that we’ve seen when practices go– we’ve seen practices go from 60-minutes to 40-minutes, or to 30-minutes, and what we see is the restorative side of the practice just starts to die. Because guess what hygienists aren’t talking about, if they don’t have enough time? What’s the first thing that they cut out, and that’s talking about restorative treatment

S4 14:37.076 And they’re not using anymore cameras. They’re trying to use some of those pieces of technology that can be incredibly valuable in that entire conversation, as well.

S3 14:46.907 And the person who loses out the most is the patient because the patient doesn’t get to understand what the conditions are, what the options are. They don’t get to understand what all dentistry can provide for them and help them with. So the big loser there is the patient. No doubt about it.

S4 15:05.405 When we look at the other practice styles, let’s say we have a practice whose primarily fee-for-service, and they don’t have enough flow? Dr. John, what are some steps that we usually recommend, that they can embrace, to know which insurance plan to accept, or what model might be a better fit for them?

S3 15:24.623 I always think the place to make choices and to pare things down with, is a full practice. I always think of, what’s the fastest way I can get from here to full? And once I get full, then I can get picky. If I’m someone who wants to do this, and do this as quickly as possible; and speed matters, we only live so long. We’re putting in those hours at our offices. We might as well be doing something while we’re there. So my advice is to really do a market analysis. Look at your market. Look at who the employers are. What are the insurance that the major employers provide? And I would make sure that I had those. I would make sure that I was a provider for those. So that would be the first place I would start. Wendy, anything to add to that?

S4 16:19.395 No, I think that’s great. I would also, maybe do a little bit of a survey, frequently asked questions when patients are calling and asking, “Do you accept my insurance?” which ones are they asking about most frequently?

S3 16:30.264 Yeah, great idea.

S4 16:30.819 Kind of what you talked about but this is doing a little bit more grassroots survey of patients who are calling and they are asking about insurance, which ones are they asking about?

S3 16:40.064 Yeah, for sure. So that’s what I would start with. Knowing that 80% of your patients come from three to five miles around your practice, who are the major employers that that area feeds with people and make sure that you’re on those plans. After that, that would be the absolute first place to start, but if I’m needing new patients, I’m going to sign up for just about everything. And once I get full, I can become– I can get off the provider panels, but I’m going to want to get full as quickly as I can. So there’s a certain pace in really highly efficient and productive practices, and I’ve had the opportunity to be in 253 practices now in the United States and Canada and fortunately, I’ve been able to see their numbers, both from a productivity and collection standpoint and as from a profitability standpoint. On many, not all of those, but on many of those also got to see the profitability standpoint. And so what I’ve observed in the ones that are really highly efficient, there is a pace. And that pace is never with your hair on fire, which is where I worry about quality suffering, but also a very steady pace, but with urgency. So everybody’s moving around, they know exactly where to be. They’re moving quickly from place to place and you can feel it when you’re in one of those practices. You know when the practice is overly full. Their systems aren’t in place and everybody is running out with their head on fire. You can feel that too. There is that, kind of this calm urgency that is the really kind of the sweet spot. Wendy, I know you’ve observed this. I know you had it in your practice and you’ve observed it as well.

S4 18:37.554 Yeah, absolutely. And it’s true. When we do backstage past experiences in your practice in Iowa, that was one of the comments that people would say is, “Oh my goodness, I couldn’t believe how quiet it was and how calm it was.” I assumed you guys added $15,000 in [inaudible] dentistry today but we couldn’t
tell. It was chaotic and that was a practice that had 21 treatment rooms. So that feeling, you don’t have to run around like things are crazy to still be effective and
efficient.

S3 19:09.912 Chaos means you did something not quite right [laughter]. And if you have a whole day of chaos, that is significant system problems, significant leadership problems. So once I have all those plans for most practices in most communities, if you have an absolute awesome patient experience. When you asked, “What should you do if you don’t?” and I jumped on to insurance plans because that’s kind of the topic, but the real first answer is improve your patient experience. And having been in an awful lot of practices, the experience is very, very similar. There’s a few on one end that are just really got a great patient experience and there are some on the other end that have a really terrible experience, but most practices are in the middle. Most practices do not stand out. Those that really nail that part of it, they get busy fast. Word spreads fast. People are looking for an empathetic, professional, well-organized, well– just a well-oiled machine and if you can provide that, that is the best thing that you can do. Now, with social media and the way word spreads and the speed at which it spreads, it’s amazing how rapidly practices can become just super, super effective and efficient and productive and profitable, just by fixing that one thing. So that would be absolutely the first place I’d start. And just a quick way to start working on that is to break down your patient experience into specific steps and then ask yourself on this step, what does everybody do? And what everybody does, you’ll find, for the most part, is pretty much what you do and just being like the rest is not going to get you where you want to go.

S4 21:19.618 Right, absolutely. Dr. John, one thing that I think we maybe should include for the listeners for the podcast today since you mentioned patient
experience, we have our 65 points checklist that we should provide to everyone who listens today. So we’ll make that available to you on the show notes and as a
download so that you can actually access that information and that may just give you a good place to start. Like Dr. John said make your list of what you’re doing.
This is a list that can actually ask your team to rate how you’re doing. You can actually even ask a few select patients to rate your team on how you feel they did, on how they feel your team performed in these areas and it provides a really nice baseline that you can use as you begin to invest some time and energy in training and improving that new patient experience. So we’ll provide that as a resource for those who are listening to the podcast.

S3 22:13.323 Yeah, that’s a great idea. So you can get that list at theteamtraininginstitute.com/podcasts– podcast.

S4 22:26.142 Yep, yep. No S.

S3 22:27.411 There’s no S. Podcast, and there’s a lot of other good materials on there. So the sheet that Wendy’s talking about is a really great tool and you’re going to identify places where you’re not doing as well as you’d like to do. And my advice to you is when you start fixing things, fix one thing at a time and I would start with the order of the patient experience. So start with how to do patients find out about you. Is your website top-notch? What’s your phone experience like, and of course, we’ve got materials for phone training. So make sure that you’re answering your phones. You’re answering them with a really high quality– and what does your facility look like? What does it look like on the outside? Just follow the path that the patient would take into your office and fix each step on that office. And when I say fix, I mean take it to a level that you know is better than what most people do, right? If you kind of know what everybody does, make it better than everybody else does. And as you work through this list, and it’ll take you a long time to work through the list. It’ll take you more than a year to work through that list and make every part of it just a little bit better. But it will be well worth it because you’ll be overrun with patients. The internet has done a fantastic thing for consumers because service companies, we just can’t suck anymore because everybody finds out about it and they find out about it fast.

S2 24:06.788 Right. Awesome. Well, what great information for our listeners today. That 65 points will really help to look in to what you’re doing in your practice. I know a lot of the topics that you guys hit on today – same-day dentistry, patient experience, hygiene appointments – we’re going to address those even deeper in further episodes. So go ahead a subscribe to our podcast if you like what you heard today and like Dr. John said head over to www.theteamtraininginstitute/podcast. And you can listen to this episode again, get the transcript there, but I also know they’re giving away an opportunity for a free “Double Your Production” road map call. So that will help you. You can connect with a member of our team and really talk about your practice specifically and how you can get the most bang for your buck as you start looking at what kind of a practice you’d like to be. Wendy and Dr. John anything else before we sign off today?

S3 25:01.234 No. Great job, Katy.

S2 25:02.715 I think it was a great call. Thank you so much. Awesome. Well, thanks for listening and we’ll see you guys next time. [music]

Resources:

1. Download a FREE copy of our 65-Point New Patient Checklist

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