Kirk Behrendt, CEO of Act Dental, and Christina Byrne, RDH, conducted a free online training covering the top 10 dental KPIs. In this episode of The Best Practices Show with Kirk Behrendt, the objective was to show you how each KPI can help you collect and use the right data to put your practice in the top 5% of growing dental practices. Here is the synopsis of the episode (aka your detailed notes + full episode included).
First of all, data is the key to running a successful business and predictively growing it. Because data tells us how to make good business decisions. So, if you want to improve any aspect of your practice or organization, it starts with gathering the right data. Without further ado, here are the top 10 KPIs to predictively grow your dental practice or dental service organization (DSO):
The BlueIQ dental business platform can collect and display these KPIs for all of your locations in seconds! Call 866-633-0534 ext. 2 or click the button below to learn more:
Definition: Your true monthly production from your full fees before anything is taken out.
One way to look at this metric is the measurement of your “potential production.” In other words, what you could be making if you weren’t participating in contracted amounts from PPO plans.
This metric, as Kirk points out, helps you become aware of your actual adjustments when compared to the KPI Monthly Net Production ($).
Definition: Your collectable monthly production.
How to Calculate: Monthly Gross Production ($) - Anything Taken Off the Top
= THE AMOUNT YOU CAN COLLECT ON
Definition: The percentage of production from fee-for-service per month before anything is taken out.
If you want to grow the private-side of your practice, you need to know how much of the private-side of the practice you actually have. The percentage and dollar amount for Monthly Gross Production from Fee-For-Service helps you determine this.
How to Calculate: Run your monthly practice analysis report to determine patient demographics. Then compare it to your patient management software report:
In order to identify how much you produced and collected from each particular insurance plan.
Compare that information to the same procedures with your full fee to figure out exactly how much you’re really adjusting off.
Definition: The percentage of dollars from PPOs or Managed Care per month before anything is taken out.
Knowing this percentage (or dollar amount) per each insurance company can help you determine the contributions to your practice from each company.
This information helps you determine which plans are more profitable so you can close the gap between gross production and net production. It all starts with knowing your numbers so you can dial back and control participation from less profitable insurances with poorer fee schedules and lowest reimbursement.
Plus, if you ever want to limit the number of insurance companies you participate in . . . or move away completely from any particular insurance company . . . or create more fee-for-service patients, then this metric will help you know the effect on your company and where to start.
Make monitoring your numbers simple. Click here to learn more about BlueIQ today!
Definition: The dollar amount actually collected per month.
When compared to Monthly Gross Collections ($), your actual collection percentage should be 98-99%. If your rate is below the needed percentage, your team needs to make sure each patient is paying their full portion when they’re having the service completed.
Challenge: How much money are you sending out the door in statements?
# of Statements Sent Each Month x $7.50 = Unnecessary Overhead
Definition: Total amount of money owed to your company by its debtors.
When the collection percentages aren’t where they should be, it lends itself to accounts receivables; look at how you’re collecting money. Remember this, people that owe you money do not like you, they avoid you, they don’t come into your office.
The Answer: Get your Accounts Receivables Total down and in alignment (less than 1-month’s net production).
(P.S. Christina recommends that your Over 90-Days AR should be less than 8% of your Accounts Receivables Total.)
Definition: The complete dollar amount per month of all expenses associated with running the business.
To determine how profitable your practice or organization actually is, you need to know your overhead. By comparing your Monthly Practice Overhead and Monthly Net Collections, you’ll determine your profit margin. Schedule a demo of BlueIQ today to learn how you can easily compare your data with a click of a button.
When it comes to overhead, your team compensation (your biggest expense) should not be any higher than 25% of net collections. In fact, Kirk advises that your percentage should eventually be more like 20% and your overhead should be in the range of 50-55% (target: 53%) of net collections.
(P.S. Doctor salary (including associate doctors) is not included in overhead. Christina recommends that doctor pay is 24% of net collections.)
Definition: The percentage of patients scheduled for recare before they leave their current appointment.
Christina recommends that 95-98% of patients should be scheduled for their next appointment before they leave their current appointment. Hitting the recommended percentage will skyrocket your restorative schedule.
Definition: The amount of new patients received from all means per month.
Most practices don’t need more new patients, they need a higher conversion rate. In fact, per Kirk, only ⅓ of all new patient phone calls get converted to a scheduled appointment.
So, track your # of NP Phone Calls and Conversion Rate (%), as well as other upstream metrics, to determine the needed systems to improve your # of New Patients per Month.
Find out how BlueIQ's automated alerts and reports can help you stay on top of your numbers: click here.
Definition: The number of days worked by the dentist per year.
As Kirk said, “There’s a difference between working hard and frying yourself.” Everyone needs a break to recharge. Per Christina, most dentists work anywhere from 170 days to 210 days per year. So, if you’re not taking any weeks of vacation, it’s killing your production.
Learn the best & worst vacation weeks for dentists: click here.
Kirk and Christina provide awesome examples and tips for each of the top 10 dental KPIs. For more of their expertise, plus bonus KPIs, watch the full episode below:
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