Episode 673

673: Red Flags to Green Lights: Strategies for Transforming the Top 3 Dental KPIs – Miranda Beeson

Published on: 29th December, 2023

673: Red Flags to Green Lights: Strategies for Transforming the Top 3 Dental KPIs – Miranda Beeson

If you want to grow your practice, you need data. But which numbers should you track, and why? To help you answer those questions, Kirk Behrendt brings back Miranda Beeson, ACT’s director of education and amazing coach, to share the top three KPIs you need to know and what to do when your numbers aren't great. Take your practice from red to green! To learn the secrets to transforming your practice, listen to Episode 673 of The Best Practices Show!

Episode Resources:

Links Mentioned in This Episode:

Register for ACT’s To The Top Study Club (April 19, 2024 and April 26, 2024): https://info.actdental.com/golden-ticket

Download ACT’s Roadmap to Practice Profitability: https://www.actdental.com/free-resources/money-tool

Download ACT’s PPO Roadmap: https://www.actdental.com/free-resources/ppo-roadmap

Download ACT’s PIT Stop: https://drive.google.com/file/d/14RC6hKURo0wu0qJmTAYtt-XEPVnwpKA4/view?usp=drive_link

Watch Episode 664: Winning With Data – 7 Practice KPIs to Illuminate Practice Health – Robyn Theisen: https://www.youtube.com/watch?v=80Zrm8oLMS0

Main Takeaways:

Know your production.

Know your write-off percentage.

Know your collection percentage.

Know the countermeasures to apply.

Quotes:

“A thriving practice relies on key data metrics in order to have an objective representation of what's happening in your practice and the performance of your team, and not basing it on feelings. A lot of times when we're looking at data, the immediate thought we have is towards money and profitability — which, don't get me wrong. I want nothing more than to help people be as profitable as possible. But sometimes, what someone is aiming towards might not be profitability. It might be one of the things we talk about, which is working less days but maintaining our profitability. And so, whatever the outcome is that the practice is moving towards, the data and the metrics are what help us to know if we're on track or off track.” (2:31—3:11) -Miranda

“We're going to start with production as our first KPI that we're talking about countermeasures for. So, if you have a production goal that you've intentionally set for your practice per day, per month, for the year and it's off track, we have to look at strategic ways that we can work effectively to shift or change that. The very first thing that I would say as a countermeasure here is performing a fee analysis, taking a look at your fees — especially if you have not in a long period of time. I would say at least once a year, evaluating your office master fee schedule and comparing that to a national database or your regional average.” (7:11—7:53) -Miranda

“It's amazing to me how many people don't put in their master fee schedule. They're putting in something else, or they don't even know what it is. You should always be billing out your full fee — even if you're 100% PPO — because you can show patients the difference. You can see the difference.” (8:43—9:00) -Kirk

“The other inherent challenge with gross production is that you have all these friends from high school, and you have a big family — all these people that ask you to do dentistry for free. And you say, ‘Don't put it in the schedule. It's my sister. I'm just going to prep her uppers today,’ all day, and there's no production at all today. So, you have to put everything, all the time, in the computer at full fee so that you can account for your time and growth potential.” (9:05—9:33) -Kirk

“I go to a lot of conferences. If you're listening to this podcast, you do too. You go to some conference, and some dentist goes, ‘Well, I produce $1.8 million,’ and it’s one doctor. And you think, ‘Oh my gosh, $1.8 million.’ Well, two practices that both produce $1.8 million where one practice collects all of it and one practice writes off 33% of it, it's not the same deal. One practice has a lot of money. The other practice has no money. The practice that's writing off 33% . . . you're working one out of every three days for free! You come home, you look at your significant other, and you go, ‘Honey, I'm doing this for us.’ And your significant other says, ‘Thank you so much, because you're working so hard for nothing,’ type of a thing. So, I'm having fun with you here on this podcast — but it is no fun to work that hard and not make money.” (9:46—10:46) -Kirk

“I was talking with a client recently, and she is primarily contracted with insurance. It's like, ‘Well, why do I need to raise my fees? I'm going to be writing it off anyway. It's just a bigger write-off that I'm going to end up showing on paper.’ But what I shared with her is, when you do go to renegotiate your fees with the insurances that you're contracted with, if you're renegotiating and they're looking at your master fee schedule and you're in the 30th or 40th percentile for your region, they don't feel a need to raise your contracted rate. So, there are two different pieces to what you just mentioned. One is, always bill your full fee. I agree 1,000%. Always make sure that what's being posted in your office is your full fee, not the contracted fee. A lot of times, what clients will share is that they send the full fee to insurance. But that's very different than posting and billing your full fee because, again, the patient doesn't see that, and it's not indicated within your software as your master fee schedule for future planning purposes.” (11:15—12:16) -Miranda

“Step one, do a solid fee analysis on at least an annual basis. And if you find yourself in the 40th or 50th percentile and you know in your heart that you are in the top 90% in your area in terms of the services that you provide and the care that you provide your patients, you have to incrementally make changes and raise those fees to where you do get closer and closer to what you believe your true value is.” (12:17—12:42) -Miranda

“To boost your production, another thing to do is two things around non-covered services. One, if you do live within an area that allows you to charge your full fee on non-covered services in terms of your state legislation on fee capping, then most certainly charge your full fee on those non-covered services. I'm going to say to do your due diligence, because in your state legislation, there are some insurance plans that if you are contracted with self-insured plans that are part of larger conglomerates like a Walmart or Coca-Cola, really big organizations, you actually have to follow their guidelines. But if you can look at your state legislation, determine if you have fee capping legislation or not — and certain or most insurance plans, you can, in fact, charge your full fee for things like an occlusal guard, if it's a non-covered service, or an implant, if it's a non-covered service within their plan. So, that's one aspect of looking at how non-covered services can benefit your practice.” (13:06—14:10) -Miranda

“The other [way to boost production] is continuing to build on skills and services that fall outside of insurance parameters. So, when we're looking at services around clear aligner therapy, whitening services, veneers, things of a cosmetic nature, if that's something that interests you — when we're looking at sleep and some of the things that are happening in the world of sleep right now, some of that falls outside of insurance parameters. So, looking at services that you can build into your practice that do fall outside of those common insurance reimbursement procedures.” (14:10—14:45) -Miranda

“[Another way to boost production] is maximizing hygiene services. As we know, the hygiene department — being a hygienist myself — we're a major influence in the productivity of the practice by way of the procedures that we are performing ourselves, diagnosing and treatment planning, treating periodontal disease, also in our treatment presentation and really queuing up services for our doctor in order to help the doctor and case acceptance. So, looking at systems and processes within your hygiene department that help to maximize not only the care that your patients have exposure to — because if we do improve our periodontal protocol and our periodontal diagnosis with patients, treating more and more patients who have periodontal disease, signs and symptoms and active disease, we're not only making them healthier and providing a better level of service, those are more productive procedures for your hygienist to be performing. And so, you're going to see the production per visit and production per hour of your hygiene team escalate over time, the more we incorporate those services. And what you say all the time, Kirk, is the more we focus on being healthy periodontally, the more patients commit to restorative procedures as well.” (14:57—16:19) -Miranda

“The other thing we want to maximize to keep production rolling is our schedule efficiency. So many practices that come into coaching, they're coming to us for a reason. One of those is they know they may not be as efficient as they can be. And so, when we're really intentional with ideal day block scheduling, looking at what we need and want to produce in order to meet our goals on a daily and monthly basis, then we can build a schedule daily and weekly that helps us to meet those goals consistently. When I work with teams around this, the thing I tell them first is, number one, you have to know what you want to be producing every day to get where you want to go. From that, we can start to build out the blocks within our schedule that provide the appropriate types of services to not only meet the needs of our patients and the frequency in which they need these services provided, but also consistency in our ability to produce.” (16:55—17:50) -Miranda

“There's nothing worse . . . than a doctor leaving at the end of the day feeling spent, totally exhausted, wiped out, driving home with the radio off because they've been burnt for this whole day. And then, it was like $1,000 of production. They were roller skating from room, to room, to room and produced next to nothing, and they're wiped out.” (17:50—18:16) -Miranda

“When you're wiped out, it lends itself to bad behaviors. That's when a glass of wine tastes so good on a Monday, and a second one tastes even better. You start to reach for that third one — you know you're compensating for other things. When you're wiped out, it lends itself to bad conversations, bad habits, bad everything.” (18:21—18:43) -Kirk

“People are out there teaching, ‘Expand capacity. Open up an operatory. Add, add, add, add.’ That is not expanding capacity. Adding ops is not expanding capacity — it's just adding ops. Adding hours is not expanding capacity — it's just adding hours. When you talk about maximizing schedule, everyone would agree, the schedule is one of your greatest allies in growing production. But you don't need more hours — you need better hours.” (19:01—19:28) -Kirk

“When you get the schedule right, your team understands it, you'll be shocked by how much more you can produce in the same time or less.” (21:01—21:11) -Kirk

“I love when a client says to me, we get on a call [and I say], ‘Tell me a celebration.’ ‘Oh, I had the best day today. I feel good. It's already three o'clock, but I could go a couple hours if I need to.’ I'm like, ‘Tell me what was in your schedule today.’ And they're like, ‘Well, I had a three-hour prep this morning,’ and they go through the day, and they tell me what was great about it. I'm like, ‘So, why can't we build your schedule so that you feel like that nearly every single day? If those are the things that you love to do, and you didn't end up rushing around at the end of the day treating three emergencies, well, guess what? Let's not put emergencies in your afternoon anymore, if that drives you crazy.’ I think that sometimes we feel like because we have to accommodate our patients that we can't also accommodate our own selves. It's just like on the airplane — put your mask on first before you put the mask on others. We have to practice self-care. To me, that's schedule care. When we're taking care of our schedule and we're taking care of ourselves and our team, then we can intentionally place patients into the appropriate places.” (21:13—22:17) -Miranda

“We can still accommodate and serve [patients] in a very reasonable timeframe. I actually was talking to a client about this, and they do accommodate patients. They’ll squeeze them right in the next day. They break their own blocks, ultimately. I'm like, ‘Being nice isn't always being nice, Doctor. You're being nice to that patient, and that does feel good. But you're not being nice to yourself. You're not being nice to your assistant who had to work through lunch. You're not being nice to the patient after lunch who had to wait, but they showed up on time. And so, ultimately, if we take good care of our schedule, maximize the efficiency of the services that we're providing, not only are we going to produce more consistently and have a lot less of that fluctuation, we're also going to feel better. And ultimately, that's what we as coaches are trying to help people do, is to be able to live a better practice and a better life, to feel like you can go home at the end of the day and be fully present with your family and not have to sit in your driveway and decompress before you walk through the door.” (22:17—23:17) -Miranda

“The next [KPI to know] is write-off percentage. That's where we talked about our gross production, that badge of honor that people show up wearing at the trade show when we know, ultimately, someone could very well be writing off 30% or upwards of 40% of what they're gross producing. So, it's really important to know our write-off percentage. What percent of our full master fee schedule are we writing off of the services that we provide? And so, step number one as a countermeasure is, if you don't know this information, learn this information about your practice. That's step number one. If I asked you what your write-off percentage was and you don't know, countermeasure number one, run a report and figure it out. That's the starting point here.” (24:04—24:54) -Miranda

“We're not saying that everyone has to get out of PPO participation, but we can see what it does, and it changes people's lives. And so, step two here, a countermeasure to consider is reducing your participation in PPO plans. We look at the average amount that a doctor is writing off, and it is upward of 40%. That's nearly half of your work week that you're working for free. Your team is giving effort and energy, and you're not seeing the reward from that.” (24:58—25:28) -Miranda

“You can't just go crazy and say, ‘I'm going to drop all my PPOs!’ because that won't work. It definitely has to be strategic when you're looking at how you're going to step away from those contract restrictions.” (25:40—25:52) -Miranda

“Everyone talks about selling out to the DSOs and all this kind of stuff. When you're working with that many insurance companies, they own your practice. They own your time. They own your fee schedule. And part of why you became a dentist was the freedom of choice — freedom of choice to do procedures, to do what was in the best interests of patients, to manage your time well, and to bill your full fee.” (25:56—26:21) -Kirk

“If you're really going to be a great business owner, you have to increase the percentage of people that pay your full fee.” (26:30—26:37) -Kirk

“Another countermeasure for write-off percentage is outside of that PPO realm. We also have other things that we're writing off within the practice. So, this is where we talk about, it doesn't have to be, ‘Go fee-for-service, Doctor,’ although we can help you get there. If you are still contracted with insurances and you just want to look at, ‘How can I reduce this write-off percentage?’ there are a couple of things we want to look at. One is elective adjustments. The other is, if you do have a membership plan, what are the adjustments that are happening and the write-offs that are happening for that membership plan? So, step one, when we're looking at elective adjustments, a countermeasure to jump right into is looking at what adjustment types you have set up with your practice management software, and then making sure that they are specific enough that they're accounting for all the different ways in which you give away your dentistry and your time. And there's nothing wrong with doing that — but there is something wrong with not knowing what you're giving away.” (27:01—27:59) -Miranda

“I'll see in practices, “professional courtesy”. So, you'll have an insurance write-off, and then everything else is a professional courtesy. But within that realm, we have so many different reasons for which we've applied that professional courtesy. It’s just the default in our software. So, we have to look at things like — I love a doctor-applied courtesy. So, when a doctor is being generous with their time, skills, and services and they decide they're going to offer a courtesy to a patient or, ‘I'm going to do that one for free,’ go for it, Doctor, if you're altruistic and that fills your bucket. But let's account for that as a particular adjustment type so that at the end of the year we can actually analyze, or at the end of the month, even, how much are we giving away with those doctor-applied courtesies.” (28:02—28:48) -Miranda

“There are other things that we do within the practice as well when we're honoring a previous treatment plan. Maybe we've raised our fees and we've agreed that for a period of time we're going to honor a treatment plan for 45 days, or...

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About the Podcast

The Best Practices Show with Kirk Behrendt
Elevate Your Dental Practice: Insights & Strategies from Industry Leaders
Welcome to The Best Practices Show, hosted by Kirk Behrendt, founder of ACT Dental (https://www.actdental.com/) and a leader in dental practice coaching. This podcast is your gateway to discovering the hidden gems and tactics used by the most successful dental practices worldwide.

At ACT Dental, we have meticulously curated strategies that have consistently proven effective in elevating dental practices. Our podcast, The Best Practices Show, extends our commitment to sharing this wealth of knowledge. Each episode features interviews with renowned dental professionals and industry leaders who have made significant strides in their practices. They share their experiences, insights, and the challenges they've overcome, offering a unique perspective that you won't find anywhere else.

Why should you listen to The Best Practices Show? Whether you're a seasoned dentist, a new practice owner, or somewhere in between, this podcast is tailored to inspire and educate. Our goal is not just to provide you with information but to transform the way you think about and run your dental practice. We delve into topics ranging from advanced clinical techniques and practice management to leadership skills and personal growth.

Kirk Behrendt, a respected figure in the dental community, brings his vast experience and infectious enthusiasm to each episode, making complex topics both understandable and engaging. As the CEO of ACT Dental, Kirk has helped countless dental practices thrive by focusing on holistic development - professionally, personally, and within their community.

Our commitment to authenticity and practical advice sets The Best Practices Show apart. We don't just talk about theories; we dive into real-life applications you can implement immediately in your practice. Our community-centric approach means we're always listening to our audience and constantly evolving our content to meet your needs.

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