The Five Stats Every Dental Practice Should Monitor
By: Dayna Johnson
When I say “monitor,” I don’t mean you write the numbers down on your spreadsheet, stick it in the three-ring binder and forget about it. I mean you are writing it down, talking about it with your team, and coming up with strategies as a team to improve it or high-fiving each other because you are exceeding your expectations. Numbers tell a story. The numbers help you reinvent systems, protocols and campaigns.
I was recently working with a dental practice that has three front office team members. They each have a list of statistics they have to track on a daily, weekly and monthly basis. They wanted my help with extracting information from their software so it would be easier for them to complete their time-consuming tasks. I was looking at the stats they were tracking and asked them two questions: “What do you all do with this information?” and “How do these numbers help your job, your practice and your patients?” The answer from all three team members was the same: “I don’t know. The doctor just wants it.”
Similarly, I often find offices that do not track anything at all. I have asked doctors what their Accounts Receivable number is, and they can’t tell me. I have asked Financial Coordinators what the over-the-counter collections are for the office and they don’t know.
There is a disconnect between tracking stats and trending stats you can use in your dental practice to make it more profitable and productive. In many offices the front office team spends hours throughout the month tracking statistics, gives the numbers to the doctor and never hears anything back. Then they start the process over again the next month with the same result.
Numbers tell a story. Use the numbers to write the next chapter and deliver an ending that is more predictable and don’t just leave your bottom line to chance. Look at numbers over a three-month average rather than on 11 a month-to-month basis. While every office can have a bad month, if you track the statistics on a three-month average, you can get a better picture of the health of the practice.
Monitoring the gross/net production and collection numbers goes without saying, so what other numbers do I recommend to offices they monitor?
You will be surprised at how much money you are losing in your practice when you let patients walk out the door without paying their co-pay for today’s visit. Your money is worth more today than it is 30 or 90 days from now and it makes a huge impact on the bottom line of the practice. With insurance plans paying less and less, the patient is more responsible than ever for out of pocket expenses. I am a big believer in collecting over the counter and recommend tracking this number very closely. This starts with the new patient phone call and training patients that payment is due at the time of service, then continues with the treatment plan presentation when creating a financial arrangement that conforms to this philosophy. Finally, at the time of the appointment when your patient is checking out, your team must have the language skills needed to ask for payment before the patient leaves. My recommendation with your practice management software is to have separate payment types for cash, check and credit card so you can easily separate this number for reporting.
Net New Patients
Notice the word “net.” This number can also be called Patient Retention. Many offices are very proud of the number of new patients they get every month until you ask for the number of patients who leave each month. If you are getting 30 new patients a month but have 20 patients leaving every month, you really only have 10 new patients. That number doesn’t sound as good, does it? It is important to know why your patients are leaving and how you can use this information to retain patients in the future. Try following up with patients who are leaving with an exit phone call to learn the reason for the transfer. If it is something you can prevent in the future, this will help your “net” new patient number improve.
Percentage of Perio Production to Overall Hygiene Production
A six-year study by JADA reveals that 42% of adults over the age of 30 have periodontal disease and 7.8% have severe perio disease. In my experience assessing hundreds of dental practices, I find offices are coding less than 20% in perio services. The hygiene department is an important piece of the dental team and it is prudent to keep a close eye on what is being scheduled out of this chair. A common area of opportunity is diagnosing in periodontal therapy. If your hygiene department is producing less than 30% in perio services, consider an evaluation with an experienced hygiene productivity coach.
Unscheduled Time Units
This number can go up and down, especially depending on the time of year. Offices tend to see more unscheduled time units during the summer months because patients want to play hooky in the sunshine. Therefore, it is important to trend this number over a three-month average just like all the other statistics. If you have more than three units of unscheduled time in the hygiene department per day, then you may want to look at new ways of making sure patients understand how important it is to keep their appointments. If patients are skipping their hygiene appointments, it could be because they don’t consider their oral health a priority so it is important for the hygienist to plant a seed that the patient will remember. For example, “If that pocket on that upper right tooth doesn’t improve, we may need to refer you to a specialist,” or “We need to watch that crack on tooth #4 very closely.” Patients may also skip their appointments because they know that if they call, they can get in within a couple of days. After all, they’ve done it before. To stop this from happening, the front office must have the communication skills to handle these habitual schedule changers.
This number affects your practice overhead more than any other statistic in the practice. In today’s economy and uncertainty in employment, practices need to be more cautious about extending a payment plan. It is extremely important to monitor not only your positive accounts receivable but also your credit balances. Depending on the laws in your state, you might have to report and send any non-active credit balances to the Department of Revenue to list on their unclaimed property report for example.
While there are many more numbers to monitor besides the five listed, these are the big ones. These numbers can be influenced with minor changes in financial policies or language skills that will have a big impact on the health of the practice. Check with your practice management software and see if you can pull these numbers directly out of your computer software. If not, you might need to create your own spreadsheet to keep track or think about investing in an online analytics dashboard. Having your practice numbers at your fingertips allows you and your trusted advisors access to information instantly. The practice numbers give you and your team the information needed to tweak your systems and give you something to celebrate. Celebrating your success with your team creates motivated and loyal team members. It is your team who can influence the practice numbers more than any one person so bring your team on board with being open and transparent about sharing the information. You will be glad you did.
Ms. Dayna Johnson has more than 25 years of experience in the dental industry managing a dental practice, training and consulting. Dayna has a passion for efficient, consistent and secure systems and helps clients develop standardized protocols for all practice management systems.