I just got off the phone with a doctor from Chicago: Super nice doctor, faced with a crushing case of “average practice”, leading to a crisis of financial margins. Average number of new patients, average production, average number of staff, etc. You get the idea, just a normal dental practice. If you dig a little deeper you realize that the overhead is approaching 90%, leaving no profits. It has become a “robbing Peter to pay Paul” situation with no end in sight.
During the conversation and the subsequent back and forth questions and answers about the practice, I asked him if he felt like the practice might be perceived as being “too expensive”. He was quick to counter with the fact that 90% of his patients were on some form of PPO and that his fees were dictated by the various plans that he participated in, so, no, he couldn’t be too expensive. It was at this point that it got interesting, because I helped him see it from the patient’s side of the chair.
Being too expensive in the mind of a consumer usually means something altogether different than just comparing the price of a single restoration to the same thing in a different practice. Let’s take them one by one and run down the list and see if you might be considered “too expensive” by your patients.
- Your actual fees are significantly higher than anyone else: This happens and can ruin a practice because the “I’m expensive, and well worth it” crowd were voted off the island years ago. Today we have highly informed consumers for whom it is second nature to comparison shop for their purchases. They understand insurance, co-pay, and the going rate for a procedure. Make sure that we can check this off the list because it has become less likely that price alone is the cause of you looking too expensive.
- You are out of network: With the national average of 64% of all patients having some form of dental insurance (even higher in most cities) being out of network means that either they won’t frequent your door or they will be leaving soon. Every time an insured patient visits an out of network doctor and pays their charges, they receive a letter from their insurance company stating that “if you had gone to an in network provider you would have saved $_____________”, and here are the names and address of dentists within 100 yards of your house that are in network. With the commoditization of healthcare, patients believe that a crown is a crown, or a cleaning is a cleaning. In fact, most consumers can’t really tell the difference from one doctor to another. The new Dental Economy has created the illusion that most doctors are the same so patients make their decision on the “convenience factor”: In network for my insurance, open six days a week, interest free financing, works on all ages, great location and parking, and has a great staff and handles everything.
- Patients don’t like you: That’s kind of rough. If you are not getting at least a 50% direct referral rate, growing 10-15% a year, keeping your cancellations and no-shows below 10%, and having an 80%+ effective recall system, you are a Donor practice and consumers don’t like you. As with this doctor, numbers don’t lie and, like it or not, if you see that these key practice indicators are off kilter, you need to act fast to deal with it. You can’t get better at giving patients what they don’t want and patients decide when and where they buy services and products in the flash of a Tweet.
- Periodontal diagnosis by the hygienist/doctor team that exceeds about 25% of their patient population: Wow! We have all been taught that upwards of 80% of the population has some form of periodontal disease. I am not arguing that, but what I am saying is that when I see doctors and hygienists going bonkers and becoming a “hammer and nail” show for perio, the practice gets a reputation of being too expensive. From the patient’s side of the chair, they think you are trying to “sell” them something they don’t need. You would too if you found out that this “fancy cleaning” would eat up 100% of your benefits for the year. This is an emotional response that results when we as dentists and hygienists leave out the concern for helping the patient and replace it with the cold hard facts of logic. Just tell them what’s wrong. Make a list and give it to them. We have a dilemma here because if we decide to never compromise (include the patients budget and concerns above our own) and the patient leaves your practice, then you will never have the opportunity to educate them, and eventually have them “want what they really need”. They have to own the problem and want the solution. My strategy would be to inform them of their condition, listen to their concerns, try to anticipate their reactions and feelings about what I was telling them, but be open to a middle ground. I have “cleaned” these patients teeth as well as I could, informed them of their periodontal condition, gave them photos of the situation along with an ADA brochure on perio, and scheduled them in 3-4 months to check their “bleeding points, and pocket depth” that I had spent time showing them in order that I NEVER LOSE A PATIENT. I am always looking at the lifetime value of the patient and always trying to understand the situation from the patient’s perspective. Keep in mind that when you are “cleaning” their teeth more often than every 6 months, you have to build the groundwork and get permission from the patient to proceed. Almost always we fall down at this and come off as being too expensive.
- Overwhelming the patient: Almost every time a dentist sees the patient before the hygienist, we overwhelm the patient (yep, don’t do that). Hey, we’re great at telling them what’s wrong. Very thorough followed by a very long list. At this point they are already in shock and they haven’t even seen what the cost will be. We failed to create trust and any semblance of a relationship before coming off as a dentist turned time-share salesperson. Even when we were talking about the hygienist diagnosing a lot of perio, we need to remember that there is an invisible line between you and the patient during case diagnosis and its presentation. If you ever come off as wanting the dentistry more than the patient, you have crossed the line. Once you do that, the patient will feel like they are being “sold” something. It is no longer a healthcare discussion, but a closing-room “pitch” in a high-pressure sales scenario. You will always come off as being “too expensive” if you cross this line. You need to always find out what the patient wants, when they want it, and how it might fit into their budget. So it comes down to how you “bundle” your fees. I would always say: “It sounds like you would like to do ______________ right away, but we are going to wait to do the ______________. Is that right?” See, I was listening to the patient and my staff because I knew what the patient wanted, what their dental IQ was, and I knew their budget. Secondly, when we went to the front desk to do the financial arrangements, we made sure that they knew about everything they needed, but we only did the financing for what they wanted to start with. Not the whole shebang. Just bite size bits they could digest. Do this and you will not overwhelm them.
Looking at every protocol, system, and interaction from the patient’s side of the chair insures that you will see increases in the number of referrals, production increases, and sustained growth. This is how you Summit.
Michael Abernathy, DDS