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Issue #27-8.28.07
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Top 3 Rules for Overhead Management
Sally McKenzie CEO
Rounding out the list of leading causes for high practice overhead, right up there with too many employees on your payroll and raises that are based on longevity rather than productivity, is an under-producing hygiene department.
The hygiene department often presents a real challenge for dental practices because on the one hand, the schedule is booked out for months. On the other hand, appointment failures and no shows are continually pounding the production potential. Consequently, the hygienist is trying to patch together a productive day while the dentist is trying to patch together a profit.
How do you get it under control? Follow the three rules for hygiene overhead management. Rule #1- The hygienist’s salary should be no more than 33% of her/his production excluding the doctor’s fees. To determine how much the hygienist is producing, divide the hygiene salary for the past year by her/his production. If production is falling short, take a careful look at the schedule. The hygienist must be scheduled to produce at 3x her/his daily wage. Achieving that requires you allot the right number of hygiene days - enough to ensure patients don’t have to wait an inordinate amount of time for an appointment, yet not so many that the schedule is riddled with holes and hygiene salaries tip above 33% benchmark.
Determine approximately how many hygiene days the practice needs each week:
- Count the number of active patients – those seen in the past year for oral health evaluations.
- Multiply that figure by two, since most patients come in twice a year for oral hygiene appointments.
- Add the number of new patients receiving a comprehensive diagnosis per year. For example: your practice has 1,000 active patients + 300 new patients = 1,300 x 2 = 2,600 possible hygiene appointments.
- Now take that number and compare it to the hygienist’s potential patient load.
If the hygienist works four days a week, sees 10 patients per day, and works 48 weeks a year there are 1,920 hygiene appointments available. - Subtract that total from 2,600. You are losing nearly 700 appointments per year or 14 patients per week. In this scenario, the hygiene department should be increased 1.5 days per week.
If your practice schedules patients when they are due rather than pre-scheduling appointments, examine how far ahead patients are booked for appointments. If there are no openings in the hygiene schedule for a solid three-week period and some patients are being bumped into the fourth week, begin increasing the hygiene department’s availability in half-day increments. If you find there is more hygiene time than necessary develop a patient retention strategy and focus greater attention on filling those extra days.
Rule #2 – Improve your recall. Delegate responsibility for the recall system to a designated patient coordinator. This person – not the hygienist – is accountable for the system’s success and is given the time, tools, and training to ensure that the schedule is full and patients are in the chair at the designated time. In addition, this person should be expected to schedule a certain number of hygiene appointments and ensure that the hygienist achieves specific daily and/or monthly financial goals. They also should be responsible for following up with patients who have diagnosed but unscheduled treatment in their records. And they should be responsible for filling openings in the hygiene schedule.
A good patient coordinator typically can handle a patient base of 500 to 1000 on an average of 15 hours per week at an hourly rate of about $15. This is the type of position that will pay for itself quickly.
Rule #3 - Integrate a new system of patient recall education. At the next appointment, the hygienist should clearly explain the need for follow-up prophies and exams to the patient. Ask the patient to address the envelope in which their recall notice will be sent. The hygienist writes a personal message to the patient on the professionally written recall letter, noting something specific relating to that patient’s dental needs. Also included in the mailing is an educational brochure. I suggest the American Dental Association’s mini-brochure 5 Great Reasons to Have Your Teeth Professionally Cleaned.
Follow a few straightforward rules to make your hygiene department a full contributor to the success of your practice and enjoy greater profits and reduced overhead.
Sally McKenzie is CEO of McKenzie Management. a nationwide dental management, practice development and educational consulting firm. Working “on-site” with dentists since 1980, McKenzie Management provides knowledge, guidance and personalized systems that have propelled thousands of general and specialty practices to realize their potential. Sally can be reached directly at 1.877.777.6151
Interested in speaking to Sally McKenzie about your management concerns? Email her at Sally@thedentistsnetwork.net