Creating the Power of Profit in Hygiene
I was reading a motivational newsletter that I subscribe to and felt like some of the topics were perfect for each of us. On a “journey” or even a race, we come to a point when we have gone too far to turn back but are wavering in our commitment to our original goal of making drastic change in our practice. Allow me to remind you of the reality of change and the substance of commitment. In life, and business, we will be judged by our results and how well we bring things to an end. No matter what goals you’re pursuing, achieving them will involve a number of universal truths.
Truth #1: You can’t finish, what you don’t start.
Truth #2: Never start what you’re not committed to finish.
Under the topic of the truth hurts, here are a few things to remember on your 180 Degree Dental Journey. You will not change your results if you do not change your behavior. Quitting when the going gets tough will never lead to success. Money will never compound by sitting in your wallet. You will never become wiser by talking rather than listening. Let’s recommit to the original goal of the 180 Degree Dental Journey: If you make a commitment…honor it. If you make a promise…keep it. If you set a goal…achieve it.
This is a perfect time to revisit a few thoughts on hiring and paying hygienists in our offices. I am unpacking an article I wrote a couple of years ago, but find that expanding on the original thought while updating the facts makes it the perfect topic for today.
Not long ago I got bullied into reopening a Facebook account by one of my clients. While this may or may not be his real name, Nathan Ho is a great dentist with a great product called Envision Stars that creates a Facebook software that can add to your marketing outreach. Anyway, I opened back up my account and, on his insistence, I joined his group, Dental Win Win, as well as The Business of Dentistry and Dental Nachos. I like reading the challenges and the posts offering solutions to various predicaments. For the most part, I rarely respond to any questions in these groups. I am always surprised by the range of solutions “posters” offer and usually with little or no understanding of the real problem. Someone posted about how expensive it was getting now to hire a hygienist and that in his area they were being paid as much, if not more than, an associate dentist. I read about 20 of the resulting suggestions and then just couldn’t help myself. It seemed that everyone was missing the point. I agree that hygiene pay has moved way out of the realm of reality when we look at pay, overhead, and profit. It is as if the universe of commerce and economics doesn’t apply to hygiene pay. As you read this keep in mind that my hygienists all took home over $150,000 a year and had medical insurance, 401k, continuing education, uniforms, a cruise once a year, and many other small perks. In other words, I want my hygienist to make more than they could anywhere else while partnering with them to offer the best service we could deliver to our clients.
I am going to state my case with the idea of offering a solution that is long overdue. There are two important foundational thoughts to this discussion that each of us need to adopt.
Foundational thought #1: We should all want our hygienist(s) as well as any other team member(s) to make more take home. If we begin with the end in mind, we should seek a system that allows our hygienists to make more and more while lowering the actual percentage of production/collections that they are paid. Reread this. They make more money and it costs us less of the overhead.
Foundational thought #2: Every hygienist deserves to be paid like a doctor. Pay that reflects their contribution as well as their education. A fair pay based on the production and profit they add to the office.
Here is the original post without the sender’s name:
“I practice in the North Los Angeles area and have been interviewing to replace my hygienist. Every applicant has been asking $430-$500/day (regardless of how many hours worked, but will not work more than 8 hours a day). When asked what their daily production was at their previous practice to justify their salary, the majority of them did not know their production numbers. One applicant required 1 hour for 1 Quadrant of SRPs, while another told me she “prefers to work on her own terms”. Is this the norm for hygienists in the LA area or have I been dealt an anomaly hand of demanding applicants? What are you guys paying your hygienists, and how much time are they requiring for recalls and SRPS? If I remember correctly, aren’t new DENTIST graduates being offered $500/day in SoCal? Surely hygienists can’t be paid as much as a dentist?”
Basically, the responses bordered on a pity party and weird off handle quips with no real resolution to his inquiry. This was my response:
“This is a wake-up call for the business of dentistry. For decades the average dental office has been increasing its participation with insurance companies. At the same time, we find that in the average US city, 76% of the working population has dental insurance. Keep in mind that when you are in-network the reimbursement rate for hygiene procedures is at a much lower rate than other dental procedures. Looking back over the last two decades, reimbursement is less (usually reduced over 50% for hygiene procedures), overhead is more, yet hygiene pay has not been impacted. This is in direct opposition to the fact that dentist employees (associates and even owners) pay rate has continued to be adjusted downward in response to these economic pressures.”
Please do this to see the actual impact of not understanding this reality. Run a production by provider report for all of the last 12 months. (Yes, I realize that I have already asked you to do this earlier, but from the questions I get and the surprise at what information I need to help our doctors, it is place that they somehow overlooked this small detail of diagnosing themselves before beginning this journey.) Then have your CPA or look at your QuickBooks and list the total pay for each hygienist. Be sure to include taxes, benefits, workman’s comp, continuing education, uniforms and the cost of an assistant if they do assisted hygiene. Just to be clear. You now have the total pay for each hygienist and the total production by each hygienist. Divide each individual hygienist pay by their production. While most hygienists are paid hourly or per day, this math will convert this format of pay to a percentage. Welcome to the reality of not understanding the business of dentistry. Most offices, for the first time, will see that the actual percentage paid to their hygienist is 40%-65%. Would you pay your associate doctor that amount? Of course not. Hygiene is not and should never be a loss leader. You would end up jeopardizing any profit you might reap. This is the basis and a strong argument to leave hourly wages or per day pay for any producer and replace it with a fair commission that would also allow other benefits. Don’t get me wrong. I want my associates, hygienists, and team members to make more than they could anywhere else. Net after expenses is the bottom line for a well-run and managed business. The ripple effect of this change, will magically have your hygienists engineer their schedule to be more productive, recall will climb because hygienists will feel the pressure to inspire their patients to return, they will feel the need to be accountable for their performance because it will affect their pay for the first time. This form of pay answers every concern this doctor has about fair pay, and time given for procedures. Our practices are consumer driven businesses where our patients vote with their feet and wallets. How you structure your pay has to be tempered by the realities of a sound business strategy. There is no position in our office immune to the effects of economics including our own.
I am probably going to get a lot of negative feedback from this next discussion. I want to talk about underperforming hygiene departments. Pretty much 90% of the offices I see are plagued by this. Whether you have one or a dozen hygienists you need to look at hygiene as the hub of your entire practice. They should be bringing in at least 33% of your entire collections. They should partner with you to help patients want what they need while building up their doctor’s image in the mind of the patient. Cleaning teeth is the last thing on the list of important functions that hygienists perform. I will assume that all of us have great “teeth cleaners” but that should be a given. If you, like many others, find your hygienist thinking her job is just cleaning teeth, you definitely will be challenged to grow your practice. This is what we need to address to create the proper culture and understanding of what a super productive hygiene department is and how it should perform.
So how do we reset the image that many hygienists have of their role in our practice? How do we elevate the importance of their part in a successful practice? How can we create incentives and consequences to ensure their growth and engagement in the business of dentistry, while not having them act like a privileged prima donna where the world revolves around them? Why would this ever happen?
Failure or falling short of the ideal in your hygiene department is the result of “no pain”. We are all familiar with the phrase “no pain, no gain”. When you work out, that leg exercise, if done correctly and consistently, is going to hurt in a couple of days. Striving and straining increases the likelihood of physical gain. Should it be any surprise that anything worth striving for is up hill? The pain of putting off gratification in order to succeed in life has become a worthy goal. When I say, “no pain” here is what I am talking about. If you pay your hygienist hourly you have created a one-sided accountability formula for mediocrity. Hygienists that are paid hourly do not feel the “pain” of:
Cancellations and No-Shows: When someone does not show up for their appointment or cancels at the last minute, an hourly employee has no skin in the game: They feel no pain. They get paid whether they produce or not. Especially if that hygienist feels that making recall calls, reactivation efforts, or cleaning up a room for a busy assistant is beneath the lofty station of an educated hygienist. Most good hygienists are more than willing to pitch in and help the team, but most good hygienists also should be responsible for their schedule by anticipating recidivistic no showers, and persistent late shows. They should constantly follow their own schedules so that they are productive every minute of the day regardless of the circumstances. Your hygienist must be engaged to the point that they will not tolerate anything less than a 90%+ utilization each and every day. An ownership mentality can only be achieved when an employee feels the sting of failure. On the other side of the equation, you, the owner, also has responsibilities. Even in an average practice they will typically see about 20-30 new patients per hygienist. Your job is to make sure that each hygienist has that number of new patients to allow them the substantial cases they need to excel at hygiene profitability. New patient appointments and scaling and root planings are their substantial cases providing the dollar amount of treatment necessary to produce a third of the office collections. To achieve this goal, 60% of any day they work must come from these substantial cases.
Few, if any, Scaling and Root Planing appointments: The number one indicator of a poorly trained hygienist and a marginal standard for clinical excellence in your dental practice is having anything less than 20% of your patients needing Periodontal procedures. Hourly hygienists don’t feel the pain when they fail to keep up with technology, clinical excellence, and patient education. They get the same pay regardless of whether or not they continue to learn and care for their patients at the highest standard of care. It’s only human nature not to strive if there are no consequences to just being average. It is also human nature not to focus on important aspects of their jobs because you fail to share the data with them. No one takes a job to do it poorly, but if you continue to pay your employees without treating them like owners by not sharing the important KPIs, you will have designed a system that gives you mediocre results.
Poor hygiene recall: This falls squarely on the heads of hygienists as they interact with their patients. 100% of patients should be scheduled for future appointments for cleanings and exams. The sad truth is that the national average is 41%. We spend all this money on marketing to attract new patients and yet fail to maximize our return on our current patient load by not continually and consistently caring for those already in the practice. Check for yourself. You will be horrified at what you see when you look at the schedule out a few months but inside a 6-month time line. If you have not done this, here is one more chance to accept the responsibility of measuring where you are and making you and your staff accountable for your results. When you get rid of your excuses, you will find your results. Just look out 3 or 4 months out in your hygiene schedule and see what you find. Most of the time you will see 3 or 4 patients scheduled and those are all early in the morning or late in the afternoon. The very times that new patients will demand. Not only are they not pre-appointing their current patients, but they have undermined the front desk by not guarding the peak demand times that new patients will want. Poor recall happens when there is no pain. NOTE: Don’t just ask them, go and look and see what it really looks like, and then share what you find.
Weather: How many times have you made it to work only to find that only one or two employees show up, and none of the hygienists. If you pay any producer by the hour, there is no pain or at least not enough to get them to try and make it to work. No pain, no gain.
Poor production per hour in hygiene: Being paid hourly allows you to stop looking at your own productivity because you make the same regardless of the day. The office takes all of the risk while the hourly hygienist takes home a guaranteed hourly wage. The reality of business is that systems that encourage mediocrity should be challenged. Hygienists and doctors are the only people who can control their productivity by improving their efficiencies and effectiveness. Hourly pay encourages an hour-long appointment. No one needs an hour to clean their teeth. They may need 70 minutes, 49, 51, but no one needs exactly 60 minutes. So why is every office scheduling exactly 60 minutes for every recall? Go to commission and magically all of this garbage scheduling goes away.
You don’t measure a hygienist’s results: What gets measured, gets done. You cannot manage what you don’t measure. That is why policy manuals, job descriptions, and benchmarks for every position are critically important. They create a black and white “scorecard” for excellence. We measure the hygienist’s production per week, the number of scaling and root planings they did per week, and the number of crowns they discussed with patients per week. This was kept on a graph posted in the staff area where everyone could see (image below). The hygienist was tasked with keeping this up to date weekly. While their job description may have dozens of other requirements, these three areas, if done well, will insure a super productive hygiene department that will continue to grow while offering the hygienist an ability to improve what they are paid in a commission based or hybrid pay system.
While we could probably add a few more areas where there is no pain in an hourly based pay scheme for associates and hygienists, I think you can see how consequences create an accountability that drives hygienists to re-engage in their jobs while understanding the business of Dentistry.
Michael Abernathy, DDS
Staff bulletin board