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Front Desk Finance for Dummies Dr. Douglas Carlsen

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Yes, by the title I’m referring to you, doctor, but only to get your attention (Actually, its been shown that dentists’ IQs rank at the top of all professions, above college professors and electrical engineers.*i But you knew that, didn’t you?). The following is a basic primer for the person who needs the most office finance knowledge and has the least time to learn about it: you, the doctor.

Step 1: Get ’em In
Consultants report that in more than 60 percent of new patient calls, the dental receptionist does not ask the patient to make an appointment. This is an outrage! How can this happen?

The truth is, most offices provide little or no front-desk training. The receptionist answers the phone, then answers questions, then waits for the caller to initiate any action.

The person answering the phone needs to take control. The goal: Accommodate quickly and get the patient to the office. Find the reason for the call, address it, then invite the patient kindly to the office. That’s it. In acting businesslike with efficiency, you’ll attract those who will take your business seriously. An efficient front-desk person with a calm, friendly tone will make all the financial difference in the world to your practice. Anyone hesitant, defensive or condescending will increase the rate of no-shows and accounts receivable immeasurably.

Yes, it’s wise to ask for basic insurance information such as carrier, employer and account number to investigate coverage before the initial visit. Any loose insurance ends might be tied when the patient visits the office. But all is secondary to getting ’em in.

Tape some calls, doc. Tell the front desk person that you need to monitor his/her policy presentation, which is true. You’ll learn a wealth more about how your practice is perceived by your patients’ first contact.

Step 2: Set Your Fees Correctly
The ADA lists a 2009 Survey of Dental Fees, published December 2009, at http://www.ada.org/ada/prod/survey/ publications_freereports.asp#fees.

It provides nine national regions for general practitioners with eight percentile groups. Specialist fees are also provided nationally, separated by percentile.

Examples for national general practitioners at the 80th percentile are given in Table 1 (right).

Doc, get your fees current! The information in the ADA survey itself can increase your income substantially this year. Please remember PPOs cause practices to have multiple fee schedules. Your software should be able to easily incorporate.

Step 3: Financial Guidelines
Your primary goal for all patient finance: Eliminate billing statements.

In-office Payments
I come across many dentists, often young, who never have patients pay at time of service. In this age, everyone pays something at any small business, including all doctors’ offices. Before you see an MD, you make a co-pay, and then receive an additional bill for any non-covered portion.

As in the medical office, the patient should make any payment before going to the back for dental work. Many collection problems will be thwarted by collecting before that three-unit bridge is prepped.

Eliminate insurance from as much of the financial process as possible.
Insurance companies are great at confusing the process. Remember it’s in their best interest to collect premiums and deny claims. To accomplish this and stay in business, any blame must be diffused and redirected. They are masters at this and you are not. Don’t try to beat them at the game.

In a perfect world, all appointments would be prepaid, allowing patients the luxury of dealing with all third-party communications. Yes, it is they who would then spend those wonderful Friday mornings on hold listening to static-ridden Barry Manilow songs.

To bypass the wait for insurance payment:
  1. Accept payment in full for any treatment plan over a certain dollar amount at the time of scheduling. Not before the appointment, but at the time of scheduling only. Don’t fall for, “I’ll be sure to have the full amount before that Tuesday appointment.” It doesn’t work. You provide a five to eight percent discount. The patient will be reimbursed directly by the insurance company. Yes, you need to provide the insurance company with the discounted figures. This is the only proven method to keep no-shows on large cases to near zero.

    If the insurance company sends the check to you, sign it over immediately to the patient and notify them immediately. It’s their money and they paid you promptly. Why endure this slight trouble? You want the patient to use this method in the future!
  2. Accept payment in full at time of service for treatment less than a certain amount. This is for continuing-care appointments, new-patient exams, and any short visit that you don’t wish to send a statement. Patients will be reimbursed directly by insurance. Present this as a convenience for patients, so as to not receive a bill. Leave as an option, not a policy.
Simple Insurance Policy
Of course, in the real world there are multiple PPOs and indemnity plans with crazy-quilt rules built to delay payments. Lost claims, claim denial quotas, and just plain incompetence riddle your efforts for equitable justice.

Obtain basic information about the patient’s insurance – carrier, employer, account number – at the first phone contact, then call or visit the company’s Web site to secure detailed information about the patient’s coverage. The more detail you find regarding insurance, the less chance you’ll have of sending billing statements.

Dr. Howard Farran’s office, Today’s Dental, offers a wonderful Insurance Breakdown Form at www.dentaltown.com/download/forms/frontOffice/Insurance_Breakdown_Form.pdf.

There are insurance benefit programs and programs within your office software to track and estimate, yet I’ve never heard of the perfect solution. Obtaining the most accurate information bolsters your chances of eliminating billing.

Step 4: Written Financial Policy
A written financial policy, provided with the new patient’s paperwork, is a must. Patients expect it. Any confusion about payment policies must be eliminated at the beginning of the relationship. That way you can concentrate on providing what you do best, service.

Check out the April 2009 edition of Dentaltown Magazine, and read Dr. Howard Farran’s column titled, “Cover Your A/Rs.” It gave great advice on building a solid office financial policy. And wouldn’t you know it, Today’s Dental also offers a nice example of financial policy at www.dentaltown.com/downloads/forms/frontOffice/Insurance_Financial_Policy.pdf.

CareCredit recently showed me a tool that it’s offering all of its customers that generates a financial policy statement followed by a patient payment agreement. It’s a five-minute process that can generate forms on your letterhead.

The CareCredit online tool provides the following office individualization:
  • Options for cash, credit card, check, practice-based financing with stated interest rates, and long-term third-party financing.
  • Additional options for pay-as-you-go over a specified number of appointments, required down payment deposits, and deposits to secure appointments for procedures worth over a certain amount, say $1,000. You can also list your discount for payment-in-full for treatment plans paid up front.
  • Charges for late cancellation within a period of time before the appointment and no-shows, as well as returned check fees.
Access is free for enrolled practices via www.carecredit.com/financialpolicy or call 800-300-3046 to enroll first.

Step 5: Outside Financing Options
Do not finance major treatment yourself. If there ever was a time when patients might be slow to pay you, it is now! Along with aforementioned CareCredit, other third-party financing companies like Citi Health Card, ChaseHealthAdvance and Springstone offer highly rated service. You can find countless threads on Dentaltown.com raving about this type of service.

Step 6: The End-of-month AR Meeting
Set up a 60-90 minute meeting with your financial and insurance coordinators once a month – the day prior to your major patient billing cycle. If you send out statements throughout the month, pick a time at the end of the month. At first, the meeting could last two hours. In time, it should settle down to one hour.
  1. Go over all patient ledgers higher than $100. Your insurance estimates should always be within that range, even for a family’s worth of recalls. Discuss the reason for the high balance. Decide on a plan of action. Call to patient? Letter to patient?
  2. Discuss all outstanding insurance older than 30 days. Have a written record in patient’s electronic or manual chart of insurance calls. After 60 days, let the patient know of the problem and remind him/her that payment is their responsibility.
  3. Know your limits. When do you send to collections? Usually 120 days is more than enough time. Use a competent service.
Of course, there is much more to front-office finance than this, yet a basic policy of keeping up to date on fees and keeping policies as simple as possible will assist all of you out there with front desk phobia.

*i: From Figure 12 of Hauser, Robert M. 2002. “Meritocracy, cognitive ability, and the sources of occupational success.” CDE Working Paper 98-07 (rev). Center for Demography and Ecology, The University of Wisconsin-Madison, Madison, Wisconsin. The figure is labelled “Wisconsin Men’s Henmon-Nelson IQ Distributions for 1992-94 Occupation Groups with 30 Cases or More” and is found at http://www.ssc.wisc.edu/cde/cdewp/98-07.pdf.
Author’s Bio
Douglas Carlsen, DDS, owner of Golich Carlsen, retired at age 53 from private practice and clinical lecturing at UCLA School of Dentistry. He provides the point of view of one that was able to retire early on his own terms in his numerous articles, personal financial consultations with dental couples, and practice financial coaching. To contact Dr. Carlsen, view additional articles, or order CD/Workbooks visit his Web site: www.golichcarlsen.com; call 760-535-1621 or e-mail at drcarlsen@gmail.com.
 
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