42: Diving Into Delta Dental Insurance w/ Joanne Tanner

Hey, dental associates and new practice owners. Welcome to the Associates on Fire podcast, powered by Practice cfo. This is the podcast that teaches you what you never learned in dental school, the financial side of dentistry. We cover topics from planning for ownership, buying a practice, to student loans, taxes, and all things financial for the hungry to learn Dental Associate. So let's light it up.

Well, good day podcasters. Hope you are excited for a very interesting rundown about dental insurance, which is a topic of a lot of confusion and probably a lot of money loss for a lot of practices, not just in how to take advantage of it and negotiate your rates, but also how maybe it's handled by your front desk. So welcome to an edition of the Dental Boardroom podcast and I'm being joined by Joanne Tanner, who is a dental consultant with many years of experience. I will let her disclose how many years at her option. So Practice CFO is a financial services firm exclusively for independent dentists across the United States. We have clients in about 22 states. We do accounting, tax, investment services, brokerage.

And anything financial, but just for independent dental practices. So on a very routine basis, we get questions about how to optimize insurance, what goes wrong with it, etc. And much like in the dental world, there are specialists to whom you send out root canals or implant cases, et cetera. Joanne is one of those specialists. So she helps people buy practices and vet them, but also consults with them after they get going. And this is a topic that she sees a lot. So we're going to try to tap into her knowledge and experience. So, Joanne, why don't you tell us a little bit about you.

Thank you for having me, Greg. I've been working with dentists for more than 40 years. My dental assistant career started in the Navy as a dental technician. Then they trained me to be a dental hygienist. And when I got out of the Navy, I decided to study business. And after receiving my master's in business, I started coaching dentists. And I found out that dentistry becomes the easier part of their day. And what we're recently coming across is the doctors are feeling that the dental insurance companies are drilling into their profits and that is not fair. We have the same fees that we had about 20 years ago. So how is that affecting our clients? They therefore coding legally and ethically, but making sure that we're coding and billing for everything. I'll give you one example right away, if a doctor is doing a crown when you see 20, 30 years ago, we were trained that the buildup was included and that's not necessarily the case now. The X ray doesn't tell the whole picture. So, yes, you take an IO photo, intraoral camera photo prior to. But when the two tooth is opened up and prepped, take another photo that with a good narrative, you will get the buildups covered. So we can give good ideas on how to make sure that you're getting reimbursed properly.

Got it. So I know a lot about kind of the macro view of dental economics, but that's interesting to me. So it's really good that I'm naive about sitting at the front desk and coding things. Is it just a matter of how they code the insurance claim submission to make sure they get credit for that buildup?

Absolutely. And the documentation, the narrative and build up is only one example.

Sometimes they're not charging out fluoride or other procedures. So staying on top of the changes because the codes do change annually.

That.

Seems like a lot of work because it sounds like you almost have to monitor your front office staff and keep abreast of what the changing codes are, et cetera. How do your most successful clients handle that?

We actually outsource the insurance to a dental billing coding expert. They work remote, but they work just like they're in your office. And since COVID it has been very difficult to find people willing to go to work every day. And so having this person who. That's all they do all day is code. And because when the scheduling coordinator comes in and they open the mail and listen to messages, the patients may be canceling for today or tomorrow. And I open the mail and I see the insurance company wants more documentation, well, I take care of the schedule because that's my fire in front of me. And sometimes that insurance claim sits there. So. But most successful practices outsource that.

Interesting. And if somebody wanted to pick your brain on the best companies to help with outsourced, I assume they should contact you. And if so, how would they do it exactly?

Depending upon what kind of practice they have, what dental software they have? Because if it's dentrix, there are people that really understand that. But if it's a different software, so absolutely, they welcome to call me, go to my website, Joannetanner.com and ask me who I can outsource it.

That actually brings up an interesting question. And I know we've got a list of prepared questions and I will get to those. But, you know, it's so easy to get down the weeds here. So one of the top topics for 2023, we're just now in it is the change in fees from our friends at Delta Dental. Can you talk a little bit about what you're seeing? Is it a nationwide thing? What's some fees going up, some are going down?

Yeah. In California, first of all, the PPO fees were increased on some procedures.

So that narrowing gap a little bit on the crowns when our new doctor buys a practice, that helped. However, they did reduce some fillings. Those insurance companies know what they're doing. So there have been a number of premier providers, especially the specialists. They've had their fees reduced by more than 30%.

That's really difficult.

Wow.

So if we think from a volume perspective, of course, like, fillings are more common, but if we're doing more of them from a volume perspective, will the overall aggregate fee loss there be higher than the aggregate fee grain from things whose prices are going up, like crowns? What's your thinking on that?

We've done the fee comparison for our clients. We get the procedure code count, and most of our clients are going to be losing some money or maybe making 10,000 a year more. It's really not much of an increase considering how much supplies have gone up, wages, lab bills, our expenses have gone up, as you know from being a cpa.

Huge increases in the last few years.

What do you think Delta's game plan is? You know, what's driving their behavior in terms of, you know, it's going to be kind of a net zero or net decline. Are they trying to get dentists to leave them? Are they just getting pricing pressure from employers? What's the. What's the game plan there? I mean, to the extent you can't.

Read their mind, there is a lawsuit that was just filed from the CDA against Delta Dental. Not sure what's going to come out of it. It was in the January Journal.

I was hoping they would increase the PPO fees even more, but at least it was something. But again, they're still only getting 900, maybe 1,000 for a crown. That's what we were billing out in 1990.

So how a dentist runs their practice today. So, Greg, it needs to be about efficiency. It needs to be about delivering Quadrant dentistry. And when they come back for the crown, maybe there's other fillings to do at that time. We need to be more efficient and if we're going to make any money.

Without cutting corners.

Can you describe weeks out? Yeah, of course. And doing the right thing. So we talked about Delta Premier and of course, kind of its cousin, Delta ppo. What's the difference between those because sometimes I even hear Delta Premier being described as a PPO at a different level.

It is a ppo. It was one of the better plans back in the day. But they haven't sold a Delta Premier plan in many years. They're honoring our senior doctors with their Premier fees. But doctors, when you log on to your Delta dental ins platform and you look at my patients, the patients listed are ppo. They're only honoring or humoring the Premier dentist by giving them still Premier fees. So when they say the Premier is going away because they haven't sold it, the Delta needed to make something more affordable for the employers. So they brought out the PPO 15 years ago or so.

So got it. So as employees turn over, they can't sign up or employers are not continuing that plan. So therefore they're trying to make it less available out of dentist offices as well.

They're not selling it as a plan to the employers as the add on for their health care insurance. It's all Delta ppo.

Got it. So my, you know, we helped buy or sell a number of dental practices and in the vast majority, except for a couple states, when you change addresses, something simpler that or change ownership, you automatically get kicked out of Premier and the best you can do is ppo. And I understand that Delta in theory doesn't negotiate. You just tell them you want to join, they tell you what you're going to get. And the difference between those rates is 35, 40%. 30%.

The fillings are half price, the crowns are 30% less. But let me go back to changing locations. I've helped a couple of clients move to a better, nicer location just a few blocks away. Other dentists have sold their practice in San Diego or moved to Northern California and they were able to transfer their Premier status so that it's not heard very often because most of the time when they sell, they're done. But they can definitely even move within the same city limits and, and take their.

So the dress change is not the factor.

Correct.

Okay.

It's really ownership certainly is.

And.

So, I mean, I think the key thing there is for buyers, right. You know, you can go and find a practice that's doing $1.2 million collections and then you have to assess what percentage of those patients are Delta because some are on Guardian or MetLife or Cigna or Cash patients. And so you're not going to hopefully get lower rates on those others that, that are as dramatic. So you need to, number one, isolate how much of the patient base is Delta Premier Decide or determine because most sellers don't know if they're on Delta Premier and then try to quantify that revenue drop. And then lastly convince the seller that they have a business that whose revenue is going to be impaired for the buyer the very next day. What do you, how do you go about assessing all of that and making the pitches another story. But how do you assess that potential impact?

Exactly. Because even the banks understand that the new doctor is not going to have the same fees. So they know there's going to be a reduction. And if they have Dentrix, Eaglesoft or open Dental, we use an app does not give us patient names, but it accurately tells us how many active patients. That doesn't change the value. But I like to know then if we know, let's say there's 1,200 active patients. Of the 1200, how many have insurance and how many have Delta? The Aetna and other plans. We've actually discovered a practice that the seller didn't realize or didn't disclose that he had some capitation plans. That's a Delta, that's a HMO for dentistry. So we tell an awful lot by utilizing that app. We can still help if the seller doesn't have one of those. And we know from doing this thousands of times that 80% of patients have insurance and anywhere from 40 to 60% on average have Delta with their insurance. There was one recently, only 21% in San Diego. Very unusual, it's a retirement town. But other than that, about half of the patients have Delta.

That's so interesting because you know, and the software that you described is a reporting software. So that information has to come out of the practice management software. So we're talking Dentrix, Eaglesoft, maybe open dental. Do you ever run into issues for paper offices? How do you assess it then?

Well, even though their charts are on paper and there's still quite a few, in fact, recently I saw a scheduling book. But they're billing, their ledgers are generally in the computer. That's been required for a while.

So even then you can assess.

We get the reports and if they're looking at buying a practice, the procedure code report tells us an awful lot. And then I get the sellers current fee schedule and I get the buyer's new fee schedule. For example, about a year and a half ago, this broker told us and the seller confirmed he was a PPO while I asked for his fees. It was a PPO plus hybrid plan that they were offering a few years ago. So if we didn't ask the questions our clients wouldn't have known that there was still going to be a reduction.

Joanne, would it be safe to say that 99 out of a hundred sellers have no idea? They may know that they're in Premier, but they would have no idea how to quantify it and might just say that they have it. But really the onus is on the buyer to somehow quantify it. And a lot of buyers don't have any help because, you know, they're just a couple years out of school. It sounds like a lot of money to get help.

I mean, so they're kind of on their own. Correct. Unless they hire.

Have a buyer's rep.

Because as you know, you would never buy a home without a third party home inspection. We've always known to have our financial due diligence with you. They know to call an attorney, get the legal due diligence, but the management due diligence and the.

Clinical due diligence, what kind of procedures, making sure they're aligned in the treatment diagnosis, we walk them through the process or depending upon location, we can help them in office as well.

That reminds me of an unfun story about a practice in Orange county that I was helping do the financial due diligence on. And luckily.

One of the front office managers kept talking to my buyer because she was an associate there at the practice that she was trying to buy. And she said because it was. He was a specialist and that was the practice he was selling. But she's like, did you know that we do all of the billing for this practice under the seller's wife's delta account?

And guess what the seller's wife's delta level was, which was premiere and she was not in the same specialty. And this was, I mean, that kind of thing doesn't happen accidentally. You know, not knowing if you're in or not, but actually going and using somebody else's insurance is probably fraud. And it's, it was the kind of thing that caused. The thing dragged on so long. I think, goodness it did. We were lucky enough to find that out. That was the kind of thing where I'm like, gosh, I wish we had Joanne involved in this. Because what is that the kind of thing that you would have found?

Typically, yes, because when we look at the insurance on the ledgers, then we can see who the provider is and who they paid. Now, anytime the senior doctor, the doctor owner hires an associate or starts a second location, they are supposed to credential that new location or even the associates as a PPO Provider. I know a number of clients have received letters from Delta through the years because they see 2 or 3 million and one dentist.

Dentist.

They know the numbers and so they clean it up and get them credentialed.

So wait, let me see if I'm understanding this correctly. If somebody is a premier dentist and breaks out an associate, that associates production has to be under the lower PPO rate. Correct.

Or be out of network.

And let's talk about going out of network. Oh, yeah, wow. That's how it is. Because otherwise, Greg, if we put the other provider on the insurance form. You said the fraud word earlier and.

Yeah, yeah, that's what that was. What was going through my head when I heard that. It's like, ooh, I don't think I would imagine again, 99 out of 100 offices are just billing under the, you know, the owner's id. Right.

Some of them are still doing that.

Probably not. Correct. Yep.

Or the smarter ones say the associate is out of network. Their fee for service.

Or you credential the associates and then my senior doctor goes out of network.

Can I make a quick aside? One question that comes up a lot to speaking of like owner and associate, can you, if you know offhand, define for us the difference between NPI1 and NPI2?

NPI type 1 is for the provider. And so if you're the only provider in the organization, that's fine because they'll pay you and you do it. But if you're the senior doctor and the owner doctor, you need to have an NPI Type 2 for the organization. And I have a link that I can send to you. Send to the doctors if they ever need the type 2.

Got it. So NPI1 is probably something any dentist in the country is going to have to have, whether they're associate or owner. And then once you have an organization.

Yes.

Like your own company, then you should get the NPI to. Got it.

Correct. Every dentist has an npi.

You need to have people under you to have. Okay, got it. Do you have to have people under you to have NPI too?

Or just have a company, A company corporation.

Because you as a corporation got it. Right. Okay, got corporation. Very good. Now you had brought up a term a second ago which was interesting because we've been talking about Premier and ppo, which are kind of the better. And basically the way those work is if somebody comes in, you know, you have a pre existing contract with Delta in some examples, or Signet or whoever, and they're like, if you do this procedure and you send us the form, we're going to reimburse you at this reduced amount. Right. But there's another type of program called capitation or HMO plans. And to my knowledge, or please straighten me out here, these are somewhat different. They're looked on less favorably, but I'm not sure completely if that's true. I've heard mixed pictures. A capitation plan pays you a fixed amount of fee based on the number of employees who selected your office as their primary office as a dentist, whether they come in or not. So let's say that's 50 bucks a month for each roll payment. You're going to get, you know, $600 50amonth for 12 months per year and whether they show up or not. And so that creates another dynamic.

Did.

Am I understanding that correctly?

You are great. And it's per head, hence the word capitation. So you get paid $6 per month per patient. That's on your roster. And when they come in for their cleanings, that should be covered. And then sometimes there's co pay for other procedures. What's important to note about capitation is the doctor will diagnose lipite. L E P E A T. The least expensive, professionally ethical, acceptable treatment, which means for a crown would be a base metal crown. That's what the coverage is for. With a cavitation plan, you can then explain to the patient that we have a much better crown. And I frequently use the example of cheap earrings, how it turns the skin green or has an allergic reaction. You certainly don't want to put a subpar metal in your mouth. And so the upgrade fee may be 250 to 400. DeltaCare does allow those kinds of upgrades. You need to have the proper documentation. But yes, it's a whole other system. And it's another philosophy that can be really difficult because then you need to find out the insurance before I go into diagnose. And that's Right.

Right.

That can be difficult.

And that's driving a lot of diagnosis. Maybe it shouldn't be, but it probably does drive treatment decisions. Right. And because you're in this battle of economics, you know, between what you want to deliver and what you're actually getting paid. So it's, it's a tight spot.

It's really tight. And also the office manager may not be calling those patients because I'm not going to make any more money. So it's the whole philosophy of that is very different. So our doctors, our clients need to determine what is our why and who do we want to be right. Because we're talking about.

I often explain to my. We were talking service offices that you know, or these patients that, you know, yes, we're more expensive, but guess what? In the offices that make 40% less or 50% less, they're going to try to find that, you know, they. Their rent isn't any different than ours. Right. Their labor cost is not much different than ours. They're going to find things to do, at least with us, you know, that we don't have those same pressures. And so, yeah, it may seem like you're paying more on the surface, but in the long run, you're probably getting better service. That's. That's a good way to talk to patients about it.

What do you think it can be what we need to make sure the patient is experiencing something beyond just the dentistry. Because patients unfortunately think dentistry is the same no matter where they go. A crown is a crown, a cleaning is a cleaning. We know that's not the case. However, if that's in the patient's mind, that's their perception. We need to say, well, what value are they getting? Why us? When I travel to get my hygienist, you know, if she leaves this office, what are we willing to do for the patient? So we're going above and beyond the dentistry.

How do we differentiate ourselves? And it's not about them cerec. It's not about the equipment.

It's.

Yeah.

Yeah. And it's often about quality and training. Right. If you go to a fee for service office, chances are those folks have gone on to get credentials that the average person isn't aware of how hard it is to get and what the commitment is, and that it's elective. Right. Like aacd, or they get an agd, you know, whether it's a master's or fellowship. These things mean people are taking their free time optionally and voluntarily and spending a lot of money to get better. So that's something else you should look at. You know, I think as you evaluate what's important to you and you pick an office.

Right. That does help their clinical skills. It's also important to remember are the systems that are in place. Because we make an error on the ledger, if we make a scheduling error, if I mistreat them in whatever reason, if I don't speak in a proper way, you know, how we're dressed, how we present ourselves, that is critical. So they're taking seminars like Disney teaches their employees how to be Disney characters. And you can bring the Disney to the dental office. Not in a funny way, but in a high end experience.

Speaking of, you know, mistakes, I'm going to tell you another interesting horror story. So I had a client who sold his practice, but slightly before that he lost his office manager of 17 years and the new person came in and said, you know, it's interesting, I'm looking at what we've been crediting to the patient's accounts and it seems to be the difference between.

You know, what is allowed on our UCR rate and the contracted rate, meaning what our full list price is and the discounted rate. And we've been giving credits for 17 years, two patients, and he went back and calculated that he's given his office manager unintentionally given away about $867,000 of.

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History or payouts?

How much? And it just seems there's no, like, there's no school for learning how to do insurers parents billing at the front desk. And it just is trial and error. And I think the, you know, call me a conspiracy theorist, but the insurance companies don't care because if it's wrong, they're just not going to pay it.

I'm not going to tell you.

What have you seen as a best. So you mentioned like outsourcing the billing or whatever. What are the best practices? How do you avoid these kind of pitfalls?

That's an excellent question. And it's quite possible that they were posting the full ucr, their cash price, their ucr. And then when the EOB comes back from the insurance company, then she made the adjustment. Most softwares will allow you to post the PPO fee or the anticipated insurance fee and still magically submit the full ucr. So that way the insurance company sees it, the patient sees it on the eob. So she may have just been posting that way, which took her a lot more time to make those adjustments. It wasn't necessarily, she was not necessarily making the adjustment, it was a posting error.

Yeah.

So we can show offices how to do that. If they have somebody that has attention to detail, we can help them get it set up. So again, the schedule reflects the forecasted production, not this higher amount. Because you don't want to come and say, oh, I'm going to do 8,000 today. No, it was more like 4,500. Especially if you have an associate, you don't want to pay them on that higher amount.

How do people get trained on that? I mean, is it this, these outsourced agencies that you were talking about?

Is that the Myself. There's other coaches. All right, There's. They need to get help outside dentistry. They've studied for four plus years becoming a great dentist. And we need to help them with the billing, the insurance, the coding, the hr, the marketing.

Yeah. So I imagine like in retrospect, this client who lost out on the 867,000 would have been happier to have had Joanne Tanner in for a little while than lose out on that amount.

Thank you. In fact, I remember, which for me.

From a CPA perspective, is like, how I make decisions. What am I getting for this spend?

Right. I remember when I was helping a doctor look at a practice in the South Bay area, I was telling my client, the potential buyer, about embezzlement and dental practices and how it happens it's no longer pocketing five and $20 cash. This particular instance, I told my client on the Visa MasterCard machine, be sure to turn off the refunds because. And so right then, the seller says, I wish I would have met you 20 years ago. He says, do you know, that same thing happened to me? My merchant called me and said, you know, we were seeing a lot of credits for this particular patient client, and I'm not ever seeing any charges. Oh, what's that patient's name? That's my office manager's name. So although our comment today is not about embezzlement, that was a good segue because somebody tells me that at least once a month, I wish I would have met you 20 years ago.

Yeah, I get that comment all the time. And I do get embezzlement questions from clients all the time. And I tell them there is no end to human ingenuity about how to steal money, so you'll never be foolproof the most. Probably the biggest takeaway is what I call the observer effect, which is described in physics, which is that the mere act of observing something influences the outcome, even ever so slightly. So just the staff knowing that you're reviewing day sheets and that you actually are just asking questions, Columbo style, for those of you who are old enough to know who that TV character was can just make people think a little bit. Twice, you know, should I be selling out? I think theft is a little bit harder, but it's just not impossible, especially as technology advances, like you said, with merchant processing, which is the other word for credit card machines. Yeah, there's all kinds of interesting things.

We could do a whole other podcast on that topic because I have a few more stories, but I also want to take care of your questions today.

Yeah, of course. So we talked about, you know, a lot about Capitation, about ppo, about Delta Premier. These are all what I think of as in network. You joined the system. But there are other offices that are out of network, which we commonly consider fee for service, which means if our list price is X, we don't take any discounts, but that we are happy to submit the insurance claim on the patient's behalf. And the Insurance check, however much or little it may be, goes to the patient's house and they keep that.

What percent of offices would you say are out of network is. What's the trend with that? You know, what does it take to, To. To maybe make the leap? How do you decide if you should make the leap out of network?

The trend is growing now. The doctors are tired of getting the same fees that they were getting 20 years ago. The buyers are deciding to go out of network right away, depending upon the demographics. We had a client in San Francisco who successfully did it. And Greg, the beautiful part about that is because Dr. Byer was never a network, the patients didn't receive that letter from Delta saying they're no longer in network and make it sound like you can't go there because they were never in the Delta. So that is a more trend now, depending again, where the practice is located.

And so do you help or like, how do you. I can tell you what I, how I decide if somebody should go out and network. It's like, you're too darn busy, right? It's like my hygiene is scheduled out four months. I can't see a new patient for a month. It's okay. You know, you have a great problem. You allow people to decide for themselves how much you're worth to them. And, you know, you put up the velvet rope, so to speak, and, you know, start going out of network is. How do you advise your clients when it's time?

Let me explain what not to do. And that's to send out a letter in mail or email to your patients because then they misinterpret thinking, oh, I can't go there any longer. So the minimum, Greg, is six months, sometimes eight to 12 if we have to get our systems, have to get our team. Team in place on delivering that. Wow. And understanding our. Why are we doing this then? The verbal skills that everyone needs.

Yeah. So what you're talking about is messaging and scripting.

And scripting, exactly. So we have the conversation with the patient that we've had a change in our relationship or we're going to have a change in our relationship when you come back in July. So you take the six months to tell everybody one on one, and we tell them now. That doesn't mean you can't come here, even though the insurance company might send you a letter and make it sound like that we are still here for you, right?

Yeah. Yeah. The best kind of Orwellian scripting that I've heard of with this is, hey, our relationship with the insurance company is changing just a little bit. They're gonna, we still take your insurance, but it's just gonna work a little bit differently. You're going to pay the fee, you know, up front when you're here, and then a couple weeks later, you know, you're going to get the check in the mail from the insurance company. That's basically it. And what some creative offices have done is they.

Will put their credit card of the patient on file and say, hey, you, the check from the insurance company reimbursement is coming in two weeks. That's when we're going to charge your cars. In two weeks. Weeks. So. And, you know, you have to train your staff because then they're going to, you know, some people call and say, hey, do you take my insurance? And the bad office? But no, we're not in network. And then people stop listening. No, we take your insurance and we pro. Here's how we work with them, right? Boom. It's just these subtle things. And I've had enough. A number of clients leave Delta, and all of them are happier and better for it. Because think about it just mathematically. Let's pretend that you lost 20 of your delta patients, but the ones who remained are paying 40% more. Right now you're doing 20% less work and making more money. So I haven't heard. I know, but I know it's extremely scary.

To. To leave network because if you're like, oh, half of my patient base is Delta. I'm going to drop by half. Well, chances are, if you've been there a year or more, they're going to know what they've got, how good they've got it, and they're going to want to stay if you message it correctly. And the right time to do it, in my mind, is when you're so dang busy, you know, now it's a chance for people to fight and show how much they love you. So let the people who are only there to do the very bare minimum and just what their insurance provides go down the block to your competitor. And I've unfortunately had some clients who are on the receiving end of that, right? They're like, oh, so and so down the block, stopped taking Delta, and I'm getting so many new patients, and I'm like, that is horrible.

That's a disaster. Because now I have to hire a new hygienist. Why you're hiring a hygienist, Especially in California, that's costing you probably 60 to 70 bucks an hour all in. And you're getting 75.

Right. It's a big math problem. And one for the doctor that's still in delta or that drop delta and they're losing patience. Why? They probably didn't check their systems, their reviews, making sure that they delivered the message properly because the patients, they'll go elsewhere and that could have happened. So it's not an easy overnight decision. If they're frustrated with the reimbursements and they're not scheduled out very far, we need to look at the internal systems right away. Are they pre appointing for hygiene? Are they tracking pending treatment plan? Are they, are they making financial arrangements? Not just half now and half at the cement, using some sort of outside financing to make sure that we have their schedule full enough before we go ahead and drop it.

Yeah. You know, one thing that I think a lot of practice owners try to do is just leave the front to the front and I'll stay in the back. And unfortunately, as a business owner, everything's under your umbrella. And I think, you know, I'll just, I often give them the example of Mark Zuckerberg or Bill Gates. Right. The reason why they're such good CEOs of tech companies is because they know what it takes because they used to do it. So it never hurts to be a little bit dangerous, even as the owner. And I know it's to get into the practice management software and look at that. But having just that little bit of knowledge so you can ask the right questions and poke around once in a while, pull some reports that make all the difference. What's your take on what you advise for doctor owners, for doctor owners, like.

I said, we need to make sure they're busy enough. And if they're not, I look at where are the holes in the systems, where are the profit leaks in the practice if their patients aren't returning now, if you're losing patients now, you're going to lose even more. So we have to figure out what's working and where they want to go. So then therefore we look at all the pending treatment plans. Why aren't they accepting treatment? So yes, although the dentist says they want to stay in the back, it's a team effort of conversations and team meetings to be able to practice and understand what we're doing, why and how we're going to get there.

You know, some of the things that owners can do is the most obvious, you know, which is, let's take an example, Joanne. Let's say you moved to a new town and you were looking for a dentist. You didn't know anybody there, so word of mouth is not an option. What are you gonna do to find a new dentist?

Right. When you go to the gym, you ask the people there. Nowadays, there's next door online on Facebook. There's your local chat, and I see it often. Hey, just moved into town. I'm looking for ABC for a vet. I need an orthodontist for my kids. And the online is so powerful, so they may see the name, but you know where I go next. Then I go to Google Reviews. So, doctors, if you only have 15 or 20 Google reviews, we need to get you more. Right? And we've actually created QR codes for our clients or short links. And we can teach them how to ask the right patient to give a review. For example, at the end of our visit, they say, greg, how was your meeting today with Dr. Tanner? And you said, well, you know, he was running behind and I'm not going to send you a review request. But you said, oh, you're right. Dr. Tanner is awesome and your hygienist is fantastic. I said, greg, I'm so glad to hear that. I'm going to send you an email. So this evening when you're in front of your computer, reply to us and write a few words about your experience with our practice. Today. Doctor reads those reviews every day during our huddle. In other words, it's not just a click five star. Because I want the words in there. That helps with their positioning.

Yeah, yeah, yeah.

So that corresponds with drop.

I can't tell you.

Yeah. How many clients I go on new clients, like a year later, after they bought the practice, I'm like, you know what, I want to look you up. And they got five reviews. Or they call themselves like Sacramento Dental, but they've got another Google site that's Dr. Smith, and the two are dissociated. So if somebody looks up Dr. Smith, they're not going to find the reviews and they're like, oh, I need to spend 2,000amonth in advertising. I was like, no, getting your online reviews is free and it's genuine. And if you. There's a book called.

Shoot, I'm gonna remember the name Influence. It's by a university professor. And one of the things in there that. That convinces people whether they should do something is, you know, what other people are saying, you know, oh, 50 million Elvis friends can't be wrong, so he must be good. Right?

Right.

And so online reviews are extremely powerful. They're extremely cheap. They're extremely genuine.

And, you know, I Review, rely on them. When I pick providers and there's even software out there, right, that can link to your practice management software that can help you easily press a button and request that. Right.

However, I don't necessarily recommend sending it to every patient. As I said, take their temperature first. Now, not physically your temperature, but ask them how did your visit go? Pick two or three every day and then it's a gracious conversation and they're more likely to write something versus just an automatic. Just like when you go to a hotel and they say, greg, it was a pleasure to have you back at our property. We'll be sending a review request. My name is Joanne. Be sure to give us a shout out. So, yeah, if you graciously ask them, it's much better. And again, that's the path to going fee for service. You make sure the reviews are good, you make sure you have a stable team. If you have a revolving door in your front office or your assistance, that may not be the right time. So making sure the team is aligned, the team is happy, and then that way we can make some decisions.

Yeah, absolutely. Now, one of the things that pops up a lot nowadays is DSOs are looking to buy practices and whatnot.

To me, mentally, I think what's going on is there's an arms race in terms of size. Right. The insurance companies have the pricing power and a one off office. They just have to take it or leave it, especially if they're in a big metro area because it's raised to the bottom between all the competitors on the block. Is that what DSOs are doing and are they getting better reimbursement rates?

They definitely are getting better reimbursement rates. And.

They have buying power, they have negotiating power with the insurance companies. Their supply bill is better, their lab costs are better, their reimbursements are better. They understand how running a business and.

They have the power.

I'll give you one example which, you know, gives them an advantage.

Pediatric dentist has a set fee schedule for solo Dr. A. All right. A large DSO for pediatric dentistry will definitely have a higher fee schedule. And that may not be significant, but it's a few dollars here and there that does add up by the end of the year. So it's definitely. Yeah, it's difficult now that the students come out of dental school owing nearly $500,000. Some not, not as much, but on average, you know, it's four or five. It's a lot of money. So then they can't go invest in buying a building in a practice Speaking.

Of student loans, I'm going to throw out a plug for a company that has been doing a lot of work like we have. I'm not sure if it works only for married couples, but one had about a million dollars of student loans and based on their calculation, they ought to be able to get most of that forgiveness. There may be a tax bond related to that, but still less another one, about 500,000. So this group is called student loan planner.com.

And I think they charge 600 bucks for an analysis. So if you've got a lot of student loans, at least have a preliminary conversation with them and see what they can do for you.

Great idea.

So Joanne, like, one of the things, you know, we talked about, you know, the DSOs, they get better rates and, and I've heard Delta doesn't negotiate, so to speak.

You know, but I've heard of organizations, so of course what you do have control over your is cash pricing. So I recommend to my clients to selectively increase their cash price some stuff that's, that's easy to shop, like exams or hygiene, maybe just put on a dollar or nothing. Right? The stuff that's harder to shop, you know, like your root canals or your crowns or whatever, that's where you get your thing. So overall, your, your, your product mix should yield you a 3 to 5% overall revenue increase. And if you think about it, if you were to raise your rates 7% a year, every year for 10 years, your revenue would double. That's just compounding.

So it's, it seems like a small thing. I call it boiling the frog that it really compounds over time. So that's one thing that you can do and should do. And there's even reports out there that I'm sure, Joanne, you can provide by zip code about what the average fees are. UCRs are by zip code and by ADA code. So you can see what your peers are doing and see if you're over under. But the other thing that you can do, I think is engage somebody to help for those insurance companies who do negotiate negotiate rates. John, can you tell us like how often you should do that? How those companies work, you know, has been successful. What's your opinion?

And I know that you're in 20 plus states across the country. Let's start with California first. There's not much negotiation to do because they have plenty of other dentists, be it Aetna, Guardian, Cigna. So be careful when you call a company and ask them, say, oh yes we can. Well, maybe in Oklahoma, parts of Texas, Louisiana I still have a client there. So it does depend and be careful, get references from them. But some will be helpful on negotiating. Check your fees every year as you mentioned, the cash fees. And that's why we like to have a membership plan. Greg I developed a membership plan in the late 1980s because they found out I worked at a dentist office and they said oh, I haven't been because I lost my insurance yet. They just got back from Hawaii or nowadays my comparison is they haven't gone to the dentist, but everybody has the latest iPhone. It's a matter of priorities and budgeting. So if you set that for maybe 400 a year, includes the two cleanings, X rays, exams, I don't care if it covers the fmx, it's fine. But you keeping it's like my own in office capitation plan. And they come back to you, they don't go down the street for the next coupon that they see and maybe then they'll get insurance coverage. But you know, frequently the insurance goes away when they retire and that's when they still need it. So I highly recommend a membership plan.

And we call it a membership program because we don't want to run afoul of state insurance laws. It's a dentist office, they have to register as an insurance company. So a membership program is a way that can be organized to not trample on those rules and where somebody pays a fixed annual or monthly fee and they get a discounted rate or two free cleanings or whatever that pays for. One of the things that has caused a hesitation for some people to go membership is their existing cash patients because those existing cash pays patients will be like, oh, I'm going to join your membership program, get 15% off. How do you like that?

And that's where you want to keep the cash patients and keep them coming back to your office. And remember, it's also good dentistry because the cash patient without the membership plan delays that six month cleaning. They push it out to eight or 10 months. So it's good business. But it's also good dentistry. The patient comes back in six months and yes, you might give them 10 or 15% off the UCR, still better than some of those other insurance fees.

So it's like a real high stickiness level. And I think what you're alluding to is unlike insurance, where I can go from insurance taking office A to insurance taking office B, membership programs don't transfer.

That's right.

It only is good at my office. So that's a good way to Keep people.

It's a smile plan. It's kind of like a gym membership for your smile.

Yeah, yeah, got it. Yeah. Well, this has, you know, been quite. I'm sure we could dig into any of these particular issues in a lot more detail, you know, because insurance is such a daunting thing. What would your kind of parting thoughts be for somebody who wants to find out a little bit more about how to optimize their use of insurance in their office or to talk to you? If they have questions about what we.

Discussed here today, I'd be delighted to talk with them complimentary to see what their situation is and what questions they have. As I mentioned earlier, depending upon location, for your clients that are thinking about buying a practice, we have a complimentary source to look at the accounts receivables. So when you run your reports, if the ARs are over 90, said oh, it's only 10%. But Greg, do you realize if the office manager is not closing out the month end that the ARS don't necessarily get aged and our client would be overpaying for those. So that's a complimentary service that we do for your clients when they're buying and we do a screen share to see when was the last time they closed out the month end.

So for to reach you would be joannetanner.com so what I'll close with is a fun horror story. So I, I had a class. Speaking of not. So what Joanna's talking about is in your practice management software, you have to put a pin in each month and the software, once you say, hey, the month is over.

It will recalculate the accounts receivable, meaning the money that patients owe to the practice so that it's accurate but without putting a pin in the end of the prior month. It doesn't do that note. Some practices do that so they can continue modifying the notice from prior patients. Probably a note. So don't do that. So I have one client that did that and he had about $25 million of accounts receivable, but the real number was much less than that. Yeah. So it made the due diligence on his practice very thorny. So I'm going to let you tell me, Joanne, if you have a similar or maybe you can tell me a great story where you walked in and you found some situation and you're like made a huge impact related to insurance or practice management.

Oh my. I could go on for another two hours of telling good stories. One comes up that the seller had no idea that there were more than $80,000 in accounts receivable credits. And had I not told my buyer to ask for the AR report without credits and then the AR credits, because that's a liability. So she said, you just paid for yourself for three years. This is awesome. So that little bit because you say I'm buying the Ars. Well, the AR report showed the Ars are only 50,000. Well, they were really 130 because there was 80 in credits. So it artificially reduces it and you just see the bottom line. So we need to learn to ask the right questions. Yeah. And I love help talking with doctors. They can text me on my cell. 916-591-2720. And I'd be delighted to talk to you about your questions and point you in the right direction.

Cool. Well, thank you so much for joining us and taking the time today, Joanne. It's been really educational. I'm sure we'll do this again because there's so much more to talk about.

My pleasure.

Thank you.

All right, talk to you soon. Have a good day.

Thank you.

Bye.

Sam.