Your practice looks successful on the surface, patients are coming in, your schedule is full, and you’re working harder than ever. Yet, at the end of the month, that uneasy feeling creeps in again: despite all your efforts, there’s still not much left for you to take home.
If that sounds familiar, you’re not alone and cash flow might be the culprit. It can quietly snowball within your financial systems and grow over time, leaving you feeling trapped in a business you built.
Here are some key areas to review and possibly reset to free yourself from that cycle:
1. Is Your Accounts Receivable (A/R) System Working for You?
Start with two critical metrics:
- Collections: You should be collecting at least 98% of your production each month. That means for every $100 billed, $98 should be received.
- Aged Receivables: Your total A/R over 90 days should be less than 15% of the total outstanding. For example, if you’re owed $5,000 in total, no more than $750 should be sitting in the 90+ day column.
Delinquent accounts should be reviewed regularly not sporadically and assigned to one person to oversee. Put clear, step-by-step protocols in place for managing overdue accounts.
2. Production vs. Overhead: Are You in Balance?
Ask your accountant for accurate numbers comparing your production to overhead. If things are out of balance, the answer may not be to cut expenses, it might mean boosting office production.
This doesn’t always mean working more yourself. Look at your hygiene department or associate productivity. If needed, bring in an expert to review systems and help identify where growth can happen efficiently.
3. Is There Consistency in Financial Communication?
While you’re the one presenting treatment, you shouldn’t be the one discussing finances with patients. That’s your treatment coordinator’s or administrator’s role. But you do need to be aligned as a team on what’s being offered.
Make sure:
- Everyone is clear on financial arrangements and options available to patients.
- Conversations are documented consistently.
- Anyone accessing a patient’s record can communicate the same message confidently.
4. Can Everyone Explain Treatment Clearly?
Patients should get the same clear explanation of their treatment whether it’s from the provider, the admin team, or the person taking their payment. It’s unprofessional when a patient questions a fee and the person at the desk can’t explain it.
Train your team to understand treatments well enough to explain them simply and confidently.
5. Lead With Care, Not Collections
Don’t make payment the first thing patients hear at the front desk.
Instead:
- Ask about their visit.
- Book their next appointment.
- Then, discuss payment.
Leading with financials sends the wrong message, it makes it seem like money matters more than the patient.
6. Are You Making It Easy for Patients to Pay?
Flexible payment options are more important now than ever:
- Insurance assignment is a win-win when paired with timely copay collection.
- Offer three-month payment plans for larger cases, just be sure to keep credit card info on file.
- Consider partnering with a third-party financing company to give patients more ways to say “yes” to care.
Final Thought
Communication. Consistency. Customer service.
These three elements will strengthen your financial systems and help you break free from the cycle of hard work with too little return. You’re putting in the hours; make sure you’re taking home your fair share.
