Ugh. Statistics. Accounting. So boring. Boooooooooooooooooooring. This is my exact reaction to running statistics for my practice:
That’s right. I whine, then I pass out asleep.
Can’t we just do dentistry? Well if you own a practice, or are thinking about it someday, then running some numbers on your business is a necessary evil. A good accountant with dental experience will help you get a handle on the financial pulse of your practice.
We should be looking at our stats on a regular basis. Some do it every month. Others do it quarterly. Whatever you choose, be consistent about it. You’d be amazed what fascinating info and trends will reveal themselves. Different practices will find value in looking at different statistics. Here are the big three that every practice will want to keep track of:
(1) New patients seen VS new patients
Obviously we want to know how many new patients we get in a given time period. But check your statistics to make sure they are new patients who were actually seen in your office, not just the ones who called and got entered in your system. Knowing both numbers and the difference between the two will give you a clue about your conversion rate. Are people calling to schedule but never coming in? Why? Are they cancelling their visit and not being rescheduled?
Let’s say you charge a patient $100 for a procedure. That’s your production charge. Well a lot can happen to that $100 before it even gets collected. Did you give the patient a 10% courtesy? Was there an insurance adjustment? Did the patient no-show a couple of times so he has a no-show fee on top of the bill? Total net charge tells the story of how much you actually expect to collect from the procedure. That $100 may go up or down a bit depending on the story. It’s a good idea to track both of these numbers to get the full picture.
(3) Percent collection
How much did you collect divided by the total net charge (not production charge) will tell you your percent collection. If you take some insurance plans or payment installment plans, then you should expect the percent collection to be less than 100% for the given period. If you’re fee-for-service, you’ll expect that number to be pretty close to 100%. If you routinely have patients pay up front for an entire treatment plan that hasn’t been completed yet, than you can see those numbers jump above 100%. Get a solid number on your accounts receivable. Walk through the details with your office manager and find ways to help patients settle their balances.