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IT’S ALL IN THE DETAILS

I was visiting with a doctor that wanted me to take a look at his hygiene production and the cost of employees in that department. In most offices, as it was with his, the hygienists were paid similar hourly wages. Their accounting procedures made it impossible to be certain what their adjusted net production was. Benefits and any other salary perks were also difficult to ascertain. All I could see was the total pay they had received over the last 9 months. So, what I did was just take their total production for the past nine months (it was the end of September) and divided it into what they were paid during the same period. This effectively creates a percentage. This number reflects the percentage of production that they actually received as pay. Here is what I found.

Hygiene pay as a percentage of production in this office: NOTE: The percentages will be higher if we include uniforms, benefits, holidays, sick days, etc., and production must be based on adjusted net production (gross production adjusted for any write-offs). Your goal should be in the 25-30% range and no higher for the total pay package.

• Hygienist 1: 37%
Hygienist 2: 37%
Hygienist 3: 36%
• 
Hygienist 4: 40%
Hygienist 5: 42%
Hygienist(part-time) $27,392 (she had not worked as a hygienist much in this last year and we could not see where the pay was attributed to)

In this case the doctor was shocked by the percentage he was paying and he understood that if I had all of the other expenses associated with paying them it would be much worse. Hygiene production will make a huge profitability impact if done properly. It is not a loss leader, as many “gurus” in the industry will advise. In looking at the hygiene department we need to understand that the hygienist(s)s as well as the doctor share responsibilities to pull this off. On the doctor’s side we need to look at how to get about 2 new patients per day per full time hygienist (the average practice with only one hygienist has 25-30 new patients a month). That would mean if there were 6 hygienists as in this case, we would need about 180+ new patients per month. If we look at new patients from a doctor’s perspective, we need 50-75 new patients per month per doctor for sustained growth and the eventual addition of another doctor. Currently they had about 110 new patients per month (there were two doctors) but a significant number of these patients never made it through hygiene. They need to do better with that and doing better means everyone in the office is guiding every patient through hygiene. Recall rate could always be better if it falls below 80%. Check your own numbers and move towards an 80% recall rate if possible. Hygiene in this office was doing about 27% of the production of the office, where it should be at least 33% or 6% more production. Based on their current yearly production that translates into an extra $132,000/year or about $11,000 per month or about $531.40 per day more. At face value, that sounds like a lot to knock down. In this office, with 6 hygienists working every day it would only be $88.56 dollars a day more per hygienist or $11.00 an hour more. This is easily doable and would mean an extra $132,000 in profit a year. The icing on the cake is that it would mean even more profit because for them to do this they would have better recall, more new patients, and fewer cancellations and no shows and an refined schedule engineered for productivity. The cream filling in the cake is if all of these things improved, the increased traffic would automatically drive more patients through the doctor’s side. Ultimately, doing everything a little better insures that everyone makes more when this office introduces a bonus system (profit sharing). Now go to work and find other overlooked gems that take little more than identifying them and coming up with a strategy to make a slight course correction.

The use of a graph will create some phantom pressure for the hygienist(s) without the non-assertive doctor having to confront each hygiene member. We always measured each hygienist’s production, number of crowns they presented, and the number of scaling and root planings they did, all on a weekly basis. Each hygienist in my office kept these graphs, and they were not paid or bonused until the data was updated and current on the graph. These graphs were posted in the staff lounge so all could see. Believe me, this gets everyone’s attention and each hygienist wants to make sure her three graphs are always trending up and to the right. This responsibility should be added to each of your hygienist’s respective job descriptions.

Asking the right questions and acting on what you discover is how you Summit: Practice Management done right.

Michael Abernathy, DDS
972-523-4660 cell
abernathy2004@yahoo.com

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Merry Christmas!