An exploration of the various key business drivers of dental practices would be incomplete without evaluating the significance of new patient inflows. While there are no shoulds in dental practice models, there are some general guidelines that can prove useful in determining whether your practice is performing as well as it can. One general model based on our statistics indicates that about 50 percent of dentist production should originate with hygiene patients who also require additional dentist treatment, 40 percent from new patients and 10 percent from emergency patients. These statistics demonstrate the impact of new patients, as well as the benefits of better serving existing patients. Comparing a practice to this model provides a benchmarking.
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NEW PATIENTS AND PRODUCTION
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What factors make new patients so significant to the production statistics of dental practices? There are many, including these:
- – New patients usually represent, not only dentist production, but also hygiene production. Many of these incoming patients will see the hygienist for their prophylactic appointments and also require additional services such as a full-mouth series, panoramic radiographs, periodontal treatment, oral cancer brush biopsy, sealants, fluoride, etc. This contributes significantly to the overall hygiene production of the practice.
- – New patients tend to be more comprehensively examined by most dentists than existing patients who are in a recall program. Dentists generally develop more comprehensive diagnostic procedures for patients they have not seen before compared to patients who visit for a periodic hygiene check. With new patients, dentists tend to develop a baseline of information on all aspects of the new patient’s oral condition. This often takes more time to accomplish than simply monitoring an existing situation and recommending any necessary treatment.
- – New patients tend to be open to recommendations from a new dentist. They often view their first visit to a different dentist as a fresh set of eyes taking a look at their mouth. Because of that viewpoint, they are typically more receptive to the various options and services available to them when the new dentist explains those options and services. For example, a new dentist may suggest placing a crown or inlay on a tooth with an old, large, four-surface amalgam filling, while the previous dentist may have decided to simply observe that tooth over time before recommending further treatment. Because of the newness of the situation and the fact that the patient has actively sought a new opinion on his or her oral health, the patient may accept the new treatment recommendation.
- – Another example of this openness includes the new patient who reacts positively to cosmetic services recommended by a new dentist who regularly provides these services and makes a point of explaining their value. That same patient may have rejected the same options from the previous practice, which may have been less involved in providing cosmetic services or in the quality of the explanations.
- – Many new patients are seeking a second opinion or a more advanced form of dentistry than they had been receiving. Often a patient will seek out a practice recommended to them to answer specific questions relating to the patient’s oral condition and appearance. The patient may have been reluctant to ask such questions of the previous practice. These new patients are generally very open-minded and more prone to take action to enhance their dental health or esthetic appearance.
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NEW PATIENTS EQUAL RETURN ON INVESTMENT
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Dentists are the chief executive officers of their dental practices. As such, they have an obligation of fiscal responsibility—to provide a positive return on investment. It is a virtual certainty that most practices each year will have increased expenses and will require some growth in revenue to maintain a positive return on investment. The realities of business make it imperative that as expenditures are incurred, there should be some predictable return on all or most of those investments.
That is why it is important for dentists to assess the value to the practice of investments such as the continuing education courses they attend, the new technologies they purchase, the new staff they hire, the office remodeling they finance—even the move to a new office. It is equally important to evaluate the average production per new patient.
Evaluating all these factors will reveal whether or not a practice is realizing adequate return on its investments in equipment, training and staff development, office refurbishing and, of course, attracting new patients. Levin Group recommends that the new patient statistics be analyzed monthly, quarterly, semiannually and annually as they are key drivers of the practice.
In addition to revealing whether new patients account for the ideal 40 percent of new production in a general practice, keeping new patient statistics will reflect the following:
- – total production on all new patients seen over a 12-month period;
- – the types of services accepted by new patients;
- – the level of insurance limitations applicable to any or all of the new patients;
- – types of services provided to those patients;
- – the interval between initial phone call and initial scheduled appointment;
- – the interval between subsequent appointments arising from the initial consultation.
Additional services such as cosmetics, implants or occlusal treatment also will affect these statistics. Together, all these figures will help to determine whether a practice is performing as well as, better than or worse than the model. They will allow the dentist/CEO to determine whether changes need to be made in the types of services the practice provides or in what manner those services are provided. A future column will assess the impact of the service mix on practice production.
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SUMMARY
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Make no mistake: dental practices are businesses. Dentists as CEOs need to focus on key performance indicators and statistical tracking in order to understand what is happening in the practice over its life span. Average production per new patient is a key factor to be tracked because it is an essential driver of the financial performance of any dental practice.
The health of this factor will have a dramatic effect on the financial well-being of the dentist, and on the timing and character of his or her retirement. At the same time, it is essential to balance financial factors with exceptional quality of care for every patient. Without both, neither will be successful in the long term.
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NEW PATIENTS AND PRODUCTION
NEW PATIENTS EQUAL RETURN...
