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Practice Transition Consultants, Matt Schere and Joe Gordon, explain the importance of regularly analyzing your fee schedules and insurance plans.

 

Transcript

Matt Scherer: Hello, and thank you for joining us today. My name’s Matt Scherer with PMA Practice Transitions. I cover all of Ohio and Western PA. I help dental professionals either sell or buy practices. This is my colleague.
Joe Gordon: Joe Gordon and I do exactly what Matt does. I just do it a little better because I do it in Indiana and in Northern Kentucky.
Matt Scherer: Right.
Joe Gordon: Today we’re going to talk about fee schedules.
Matt Scherer: Ooh, tough topic, Joe. Fee schedules.
Joe Gordon: Nobody ever likes to look at their fee schedules. Unfortunately, they are kind of the redheaded stepchild of a practice someday.
Matt Scherer: That’s true. How many dentists do we know, older dentists especially that they probably haven’t looked at their fees in 10, 15, 20 years?
Joe Gordon: Right, exactly. They’ve priced themselves well below the market, and sometimes even priced their fee for service schedules below what insurance companies will reimburse these days. It is a topic that needs to be addressed. We like to see it done in a practice at least twice a year. It’s just good. I mean it will help you maintain the value of your practice, and from a buyer’s standpoint they’re going to want to come in, obviously, we’ll see your fee schedule, and if it is well below market, they may not want to deliver that dentistry for that price.
Matt Scherer: If you haven’t taken a look at your fee schedule in a long time and don’t know where to even begin, there are companies out there that will actually do a fee schedule analysis for your surrounding area to see where you fall in with the rest of your peers.
Joe Gordon: Sure, sure, a lot of the dental suppliers will offer that to you for free, and there are other places you could hire to do that. The one thing I encourage practices to do at least once a year if not twice a year is look at their insurance plans.
Matt Scherer: Yes.
Joe Gordon: What I want them to do is it’s no harder than this. Get a piece of paper and write down here you put down your top 10 procedures by revenue. Not the most expensive ones but the ones that produce the most total revenue.
Matt Scherer: The most, right.
Joe Gordon: You put that down here. Up here you, if you take 10 insurance plans, put those 10 insurance plans, and then fill out the matrix of what they are reimbursing you for those procedures. I guarantee you the first time you do it you will be shocked at the variance that the different plans will pay you.
Matt Scherer: Or plans that pay you less than what Medicaid would pay, right?
Joe Gordon: Exactly. Exactly, and then put your own fee down there, so you can compare and see where you are really giving up revenue, and either, if you can, drop that insurance company or go back and renegotiate with them. If you aren’t comfortable dealing with that, we work with a number of companies that will go do that for you, and it’s well worth the investment.
Matt Scherer: Don’t be afraid. Raising your fees is okay. Most of the time your patients know that things cost more money. I mean as time goes on things cost more money. We kind of touched on this in a previous segment about fees and raising fees and things like that. We just wanted to kind of do a little bit deeper dive in this segment about it.
Joe Gordon: Right, and don’t be the discount auto store.
Matt Scherer: Correct.
Joe Gordon: That’s trying to sell you the used car at a big giant discount. Don’t discount your fees. You don’t have to do that. People understand that you’re a professional. They don’t expect 20% off or 15% off or whatever.
Matt Scherer: Right.
Joe Gordon: Also, bill for what you do. just because, unfortunately, Mrs. Smith needed four cavities filled bill for all four. Don’t just bill for three.
Matt Scherer: Yeah, it’s okay to do so.
Joe Gordon: It is absolutely okay.
Matt Scherer: And I think too often than not if you’re doing heavy discounts it makes it real tough for a buyer to want to buy the practice because then obviously if they change those discounts they could lose patients and things like that, so it’s always better for you the seller to A, change the fees, increase them, and B, stop doing discounts if you’re doing discounts.
Joe Gordon: Exactly, exactly.
Matt Scherer: We appreciate your time today. Hopefully, this was helpful. If you like us, please give us the thumbs up and certainly don’t be afraid to share this with your colleagues and friends. Thank you.