With inflation at its highest level in 40 years, dental entrepreneurs continue to feel the economic pressure to remain profitable, especially for those considering a transition of ownership. Along with your current patient base and competition, you’ll want to assess the overall value of your dental practice in order to know in what direction you need to be heading. Here are ways to raise fees at your dental practice to offset annual inflation without alienating your demographic.
The plan
Studies have shown that increasing fees by 1% in 90-day increments allows time to evaluate patient reactions. The goal is to increase fees by 5% to offset inflation and increase profitability. Although raising fees does not automatically increase insurance reimbursements, it takes some time for product prices, fees and employee pay to level out during times of high inflation.
Raising fees
Most patients will only notice an increase in hygiene or hygiene-related services since those are standard and a fee all patients have paid in the past. Chances are, they don’t know what you typically charge for a crown, veneer or root canal. But don’t just increase fees without notifying your current patients; communication is key here, including why and how often you plan to raise fees, so your fee schedule stands the test of time.
Moving forward
If you receive pushback, this is also an opportunity to reevaluate your marketing and outreach strategy. Yes, there’s always an opportunity to attract new patients to your dental practice, but you’ll also want to make sure you maintain attrition rates when making any changes to your dental practice. Above all, during uncertain financial times, it’s a chance to look at other ways to lower your overhead costs, all while keeping the ultimate goal of transitioning your business in mind.
Bottom line
As with any business, raising fees is part of an annual strategy to keep your dental practice healthy and strong. Contact the experts at Professional Transition Strategies to receive a free valuation to see where your business stands.