Raising the Bar
Strategies to help practices achieve maximum productivity
Roger P. Levin, DDS
Over the last 40 years, dentistry has made great strides in the area of productivity improvement. Productivity is generally defined as "the quality or state of being productive," but for the purposes of dental practice management, the term is used to refer to the day-to-day actions that allow a practice to reach (or surpass) the desired level of production. Production, in turn, determines a practice's profitability and the owner's income. Improving profitability is a major incentive to improve productivity, but another of the main benefits of improved productivity is greater enjoyment of each workday with lower stress and less fatigue thanks to the efficiencies achieved.
Productivity is one of the key factors in both the short-term and long-term success of dental practices. However, there are many pressures on dental practices today that affect their ability to improve productivity. These include the staffing shortage, stagnant or reduced reimbursements from dental insurance companies, and many others. The good news is that there are numerous highly effective strategies that can help practices to increase productivity.
Productivity Campaigns
Even if they don't refer to it as such or think of it in this way, at some point during their careers, most dentists launch a productivity campaign. Productivity campaigns can be motivated by different factors, such as the realization that the practice has hit a plateau or is declining or simply becoming aware that there are opportunities to enhance productivity and increase profitability. And because debt often plays a role in the lives of many dentists, beginning with student loans and continuing with the business loans needed to open or acquire a practice, the opportunity to enhance productivity and increase profitability is very appealing. But what exactly is a productivity campaign?
At the top level, a productivity campaign involves a complete overhaul of the practice to maximize the efficiency of everything from the clinical protocols to the administrative functions. Productivity in both of these areas has a direct effect on practice production.
Improving clinical productivity refers to pursuing the most efficient methods of treating patients in order to be able to provide the standard of care at the lowest possible cost. Opportunities in this area include implementing better clinical systems and protocols, decreasing time wasted by doctors and/or hygienists, and implementing technology that can improve the speed and efficiency of treatment while providing a return on investment.
Administrative productivity refers to all of the business functions of the practice, which typically take place at the front desk or in the offices of insurance coordinators. Modern dental practice management concepts originated in the early to mid-1980s. Since that time, excellent consulting firms have developed step-by-step systems, comprehensive management curriculums, and scripting for teams. There are many opportunities available to easily enhance administrative productivity and propel your practice to levels that you've never seen before.
It is critical that practices invest properly in solutions that will allow both the clinical and administrative areas of their offices to maximize productivity. Anything that enhances speed, efficiency, or flow will automatically enhance practice productivity, which will then subsequently increase production, profit, and income. Here are six strategies that practices can incorporate into their productivity campaigns to help maximize their results.
1. Reactivating Inactive Patients
There has never been a firm definition of what constitutes an inactive patient. In many practice valuations, the valuators will use a metric in which patients are considered inactive after they have not been in the office for 18 months. From a practice management standpoint, I prefer to use a different definition: an inactive patient is any patient who does not have his or her next appointment scheduled.
At many practices, up to 20% of their patients are inactive at any given time. If you simply do the math, you'll recognize that over a dentist's entire career, this could result in a loss of millions of dollars of revenue from patients that are either off-cycle or lost to the practice. Moreover, patient loss necessitates the acquisition of new patients, which requires actions that further cost the practice.
Your practice should establish a system to reactivate inactive patients. Have your scheduling team set aside some time every day to contact inactive patients using the principle that every patient is considered inactive when they become one day overdue for a check-up. This discipline will reduce the number of lost patients over time, thereby improving practice productivity.
2. Acquiring More New Patients
In my experience, new patients have a 200% to 300% higher financial value to a dental practice during their first 12 months when compared with the average production of a current active patient. If 40% of production can be generated from new patients, it is an easy calculation to determine how many new patients should be seen each month based on the average production per new patient. Patient acquisition is a critical factor in maintaining and increasing practice productivity and production. The best place to begin is with a simple, well-strategized plan that combines strong customer service strategies with internal marketing strategies to generate new patients.
3. Increasing Hygiene Production by 20%
This topic warrants an article unto itself and there are many in the literature. Most hygiene programs generally focus on basic prophylaxis with some periodontal treatment thrown in. However, imagine a hygiene department where the hygienists are trained to identify broken or failing restorations and prosthetics, to discuss esthetic and implant treatments with appropriate patients, and to perform other nontraditional duties. Expanding the role of dental hygienists enables them to contribute to improving the practice's productivity in ways that transcend simply cleaning more teeth.
4. Building a Better Schedule
Implementing a new and improved scheduling system is often the essential first step in enhancing practice productivity and efficiency. Scheduling is about way more than where the open time slots are and filling them based on patient preference. The schedule should be mathematically constructed not only to achieve the daily goal each day but also to decrease no-shows and last-minute cancellations, motivate new patient callers to make appointments, accommodate some emergency patients, and move patients into the most appropriate time slots while creating an image of convenience. Practices with strong but flexible scheduling systems can achieve high levels of efficiency, productivity, and production.
5. Tracking Production per Hour
Practices that are serious about improving productivity should track production per hour. This may be the most revealing statistic about a practice's performance and how to enhance it. If the production per hour is increasing, even slightly, that is a positive indicator for productivity. If it is flat or decreasing, that is a negative indicator. Keep in mind that practices that participate in dental insurance programs will not necessarily be able to raise fees as a strategy to increase production per hour for insurance patients.
6. Saving 10 minutes per Hour
During the last 15 years, we have repeatedly demonstrated that most practices can save 10 minutes per hour by scheduling more efficiently, delegating better, and taking advantage of new materials and technologies. We establish this data by performing procedural time studies on the major services offered by practices. This identifies where time can be saved. If you are wondering if saving 10 minutes per hour is a significant and worthwhile effort, just ask yourself if adding the equivalent of 2 months of extra doctor production to each year is worth it to you.
Yeah, that's right. Saving 10 minutes an hour adds up to 2 extra months per year of doctor production. Over a 36-year career, it adds an amazing 6 extra years of doctor production without requiring you to work one more minute longer than you otherwise would have and without adding any fixed expenses or additional stress. This may be one of the greatest benefits that you can achieve, and with that mathematically designed schedule putting those extra 10 minutes per hour to work, your practice will experience a significant increase in productivity.
Target a Goal and Accomplish It
Dentistry is a business, and dental practices must be operated in accordance with sound business principles. The best results are achieved when practices place a strong focus on maintaining the highest levels of efficiency and productivity. These then contribute to higher levels of production and income, which are essential elements of practice success. There are many strategies that practices can incorporate into their campaigns to increase productivity and production, but they should start with those that will have the greatest impact. Practices should set a target of 15% to 18% growth for each of the next 3 years, and by implementing the strategies presented in this article, they can be well on their way to accomplishing that goal.
