Is your dental clinic profitable? Most dental clinic owners assume that accepting more insurance plans will increase their revenue. However, accepting more insurance plans is like offering more payment options. Some patients will opt for cash payment, while others may choose to pay by credit card. The difference in profits between these two scenarios can be as large as 50%. Here are some tips to increase the profitability of your practice. These tips may help you run a successful dental clinic.
The most effective way to increase your profitability is to expand your practice’s service offerings. This can be done by increasing the number of full treatment plans. If you accept more insurance plans, your profit margin will increase. In addition to maximizing your profits, you should also accept dental plans that are not accepted by your competitors. You may find that you will be able to accept more dental plans and earn higher profits with less effort. However, this method will not be effective if your fixed costs are too high.
Another quick way to increase your profitability is by adding more services to your practice. Dental insurances can help you to attract more patients. Moreover, they help you to lower your overall practice costs. For example, accepting insurance plans from other insurance providers will give you access to an extra 80% of your practice’s revenue. These new services will help you increase your profitability, which will ultimately increase your practice’s revenue. You can even sublease your office space to another dentist. It is a great way to decrease your overhead costs and increase your income.
Increasing the number of procedures that your dental clinic performs can increase your profit margin. In general, a dentist can perform an average of 60 procedures per year through outpatient referrals. However, if you add procedures to your practice, you can double your revenue. Most dentists only manage to complete 60 procedures per year, but the best ones can get in as many as 120. By doubling the number of procedures, you will double your revenue.
Another way to increase the profitability of your dental practice is by raising your fees. Fee increases can be modest, usually two or three percent, so they won’t significantly surpass the competition. But by raising your fees by four to five percent yearly, your practice will be able to rise above the competition. However, you should note that you may need to raise some fees higher than others in order to make up for the cost. Avoid imposing fixed percentage increases on all procedures.
A dental practice can also create its own financial system for its patients. Comstock suggests setting up an in-house membership program, which patients pay monthly or yearly. Members of the dental practice will receive structured benefits from the practice. As a result, your practice is less dependent on the middleman. Using the practice’s own financial system can help you cultivate loyalty with your patients. The goal is to improve the quality of care your patients receive, while creating recurring revenue.