The Dentist's Network #46


	Termination Retaliation Treatment Room Marketing Solo-Group Partnerships

Michael Moore, Esq.
Director McKenzie
HR Solutions
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Avoiding Employee Termination Retaliation

Dr. N operates an established multi-office dental practice in Saginaw, Michigan. Last September, he hired a male dental hygienist—Gary—to work in two of the offices. As part of the office’s procedure, Gary was supplied with the practice employment handbook developed by McKenzie Management containing the policies and procedures. He was given time—paid time—to read the document and signed an acknowledgement that he had read and understood it.

Additionally, Dr. N has in place an alternative dispute resolution policy (also a McKenzie product) that diverts most employee/employer legal claims from the courts to mediation and binding arbitration. Gary was provided with literature on that policy, and signed another document acknowledging his acceptance.

Nine months later, Dr. N’s office manager comes to him with surprising news. Gary’s co-workers are telling her that Gary has been talking about the photographs he’s taken of broken equipment, exposed needles, etc. That isn’t all. He’s also claiming that if he’s ever fired, he will go to OSHA with the “evidence.”

Dr. N’s office manager, following the procedure in the McKenzie employment practices handbook, meets with Gary in the presence of a witness. When asked if he has been taking photographs, Gary admits it, but then claims it was all a joke and that he has emailed the photos to his wife. He makes no reference to any OSHA violations and tries to laugh off the incident. Gary was asked if there were any other issues to discuss; he volunteers that Dr. N is not conducting proper patient examinations.

The office manager confirms that Gary has never approached management about Dr. N’s alleged improper examinations—even though he is encouraged to do so by the “Employee Concerns” process set out in the McKenzie employee handbook. This process provides a vehicle for employees to bring any concerns to the attention of management, including filling out a form with the concern identified. The office manager gives Gary the form and asks him to fill it out, which he does. Again, he makes no mention of any OSHA violations.

Gary’s objections to Dr. N’s examination procedures are found to be without any substance. The employment policy contains a non-exhaustive list of prohibited conduct. Confirming that Gary’s actions have violated several provisions of the employee conduct rules—a commonsense conclusion—Dr. N decides to terminate his employment. A termination letter specifically detailing Gary’s violations is prepared and delivered to Gary by Dr. N at a termination meeting. The letter also confirms that any dispute Gary might have with the practice is governed by the alternative dispute resolution policy, which diverts most legal claims from the courts to binding arbitration.

Had Dr. N not had this policy in place, like many doctors I work with, he would have been consumed by indecision about just how to deal with Gary. He may not even have had the fortitude to terminate the employee.

The only real risk to the practice in this situation was the possibility of Gary making a claim that the termination was in retaliation for his having complained about OSHA violations. The OSHA Act and the common law of many states both allow a civil claim for damages and reinstatement if retaliation is proved. However, when Gary was confronted by management and twice offered the opportunity to identify his concerns, he failed to mention safety violations or any intent to notify OSHA. He confirmed this in writing when he failed to list such concerns in the “Employee Concern” form he filled out. With this, Dr. N was free to terminate him without concern of a viable retaliation claim.

Why was he justified in having no concerns? First, he documented everything including, and possibly the most important, the termination itself. I cannot make this point enough: plaintiff lawyers do not take cases in which the employee’s own words contradict his or her later claims. Gary’s failure to document any concerns about OSHA violations in the Employee Concern form is the kind of omission that causes plaintiffs lawyers to turn these cases away. Second, a plaintiff lawyer will be even less likely to take a case for which arbitration will be the sole means of recovery.

The lesson here is that it never pays to avoid addressing rumors that come from employees. It always pays to have a game plan, to have the employment policies in place and to follow through with them when confronted with a potentially dangerous employee like Gary.

Moreover, it is critical to document the reasons for termination in the file and the letter given to the employee. Remember, if that employee seeks legal advice, the first thing the lawyer will want to see is the termination notice. If there is no termination letter, or if the employer is foolish enough to either give no letter or to justify termination with the far-too-common “things aren’t working out,” the lawyer is much more likely to give an ear to Gary.

Dr. N may yet receive a letter from a lawyer asking for more information. If that happens, it is no problem. Dr. N will send the lawyer Gary’s entire file, including the “Employee Concern” form that Gary executed. Knowing that any claim will have to go to binding arbitration and that there is a solid non-retaliatory basis for termination, the lawyer is not likely to take Gary on, so Dr. N can rest assured that the matter has been concluded successfully.

Mike Moore is ranked among the best in employment law and named one of the top 10 lawyers in Ohio. As Director of McKenzie’s HRSolutions, Mike is the creator of the Employment Policy and Handbook, geared to provide dentists who are unsophisticated in the legal arena with a step-by-step policy manual.

Click here to hear Mike present “7 Elements of an Effective Employment Policy.” Email Mike at mike@thedentistsnetwork.net.

Interested in having Mike speak to your dental society or study club? Click here.

Joel Harris, President
ADA Intelligent Dental
Marketing, Inc.
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Does Marketing Belong in the Treatment Room?

First of all, let me answer the title question of this article with a resounding YES. In every dental practice there are multiple opportunities to utilize basic marketing tactics to improve patient flow, referrals and image. However, the most overlooked area to implement well-executed marketing tactics is in the treatment room with the patient in the chair. This is your chance to really “sell” the advantages of dental health and proper oral care. Many dentists find, though, that their marketing efforts here are not successful. Here is why it fails so often:

Consumers are conditioned to block out boring advertising messages and complex or confusing information. If it’s funny, exciting, sexy, offensive or otherwise emotionally potent, consumers will focus for a brief moment. After that brief moment they’ll move on to one of the other thousands of marketing traps set every day and everywhere. As dentists, you are competing for “consumer attention” with the most sophisticated and brilliant marketing experts in the world. New cars, boats, vacations, college tuition, high-def TV, Gucci handbags and Rolex watches are just a few of the reasons that a consumer may delay their dental care. The list of reasons is enormous and growing daily.

I am convinced that delaying or ignoring dental care is more related to consumer spending habits than to fear of going to the dentist. This is mostly due to the amazing success of consumer advertising in contrast with the failure by many dental practices in case presentation. Patients aren’t afraid. They’re pre-occupied with the financial pressure to pay the mortgage, travel, drive the cool car and have the perfect life that is driven by buying and acquiring more stuff. A root canal and two crowns on teeth that don’t hurt yet are way down on the list.

When a consumer walks into an Apple Store, they immediately fall into a state of buying hypnosis. Apple stores are built to catch consumers like rats in a trap. BMW dealerships, Barnes & Noble bookstores, Krispy Kreme donuts and even the convenience store on the corner know how to get consumers to buy. You can dramatically improve the number of buying patients in your practice by applying the same marketing and selling principles that these companies have all learned, by following some of their rules:

1. Looking successful. Image is everything in the age of the consumer. If your image doesn’t seem professional you’re already off to a poor start.

2. Beautifully displayed products and services. I’m not talking about a set of crowns on a velvet pillow under glass. I’m talking about beautiful wall art of people with perfect smiles in the treatment room. Your product is a great smile, so don’t be afraid to sell it. Also remember that your own teeth and the teeth of your team members will be scrutinized by most patients.

3. Easy ways to pay. Do everything you can to promote easy payment terms by working with finance companies that have good approval rates and creative payment plans. Then, promote your product and services like a car dealer would.

4. Up-selling at the register. Retailers sell dozens of high-profit incidentals at the register. Consumer electronics always come with a sales pitch for an extended warranty. You can do the same with whitening kits, Sonicare toothbrushes or hygiene products. It will surprise you how much merchandise you can sell in a year just by doing what the grocery stores do.

5. Beautifully designed sales tools. High-ticket consumer products and services almost always have very expensive brochures and other printed materials to keep consumers’ interest level high if they leave without buying. Some dental treatments are considerably more expensive than a hot tub or a big screen TV, yet some patients who don’t accept treatment leave the practice with nothing but a business card and a treatment estimate. No wonder the hot tub usually wins.

6. Higher profit hiding in bundles. This retail method has been used for years. Dentists that bundle or package services together instead of billing for them individually can add value to the package of services while making more money by selling more to each patient. One example is combining a professional teeth cleaning with fluoride, x-rays and oral hygiene instructions in one attractive package. In fact, giving such a package a creative name enhances the value. Selling in-office whitening at a substantial discount to patients receiving any restorative procedure over $1,000 is another example of creative bundling.

7. The $99 trick. What's the big secret about ending prices in 9? Research shows that people process information from left to right. In other words, the "1" in $19.99 is more appealing than the "2" in $20. Most dentists round their treatment price up to nearest dollar. Don’t make the mistake of thinking dental services are different than other consumer purchases.

8. Selling products with a wide variety of price options. Consumers love to upgrade to more expensive services and products. Some of them want the “best.” Make sure your fee schedule gives these consumers the option to upgrade.

Joel Harris is CEO of ADAIntelligent Dental Marketing, one of the nation’s leading dental marketing companies. It is focused exclusively on dental practices. ADAIntelligent Dental Marketing provides powerful marketing tools to help dentists grow their patient base, increase their profit and improve their image. Joel can be reached directly at 877.942.8855.

Interested in speaking to Joel about your marketing concerns? Email him at joel@thedentistsnetwork.net.

Interested in having Joel speak to your dental society or study club? Click here.

Thomas L. Snyder, DMD, MBA
Managing Partner
The Snyder Group, LLC
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An Alternative to a Partnership Arrangement

It has often been said that many dental partnerships do not survive. Although there is no hard research to support this statement, you probably know of a dental partnership that has failed. Of course, many partnerships do quite well; their success is attributable to well-designed agreements incorporating “win-win” compensation arrangements and a well-planned exit strategy for the retiring partner that assures a fair buy out at the end. Conversely, partnerships that have been established for many years sometimes run the risk of failure due to changes in the goals and objectives of individual partners resulting from financial problems or personal matters.

In our experience, we have found that partnerships that fail usually have no written agreements to address the many components that need to be considered to function properly. If you are contemplating a long-term partnership and if you are concerned about future problems surfacing in your new relationship, you may want to consider an entity that maintains your independence. That entity is called a Solo-Group.

Establishing a Solo-Group
If, for example, your associate has been employed for several years, he/she can purchase the list of patients that have been assigned to the associate. Valuation methods vary. One approach uses a multiple of associate gross revenue to calculate the value of the patient list. Another method determines a per-record acquisition cost. If you are selling an interest in the practice’s tangible assets and if it is decided that there will essentially be an equal utilization of practice assets, you would sell 50% of the fair market value of all tangible assets. The associate will then have an undivided interest in the tangible assets of the practice.

Tax-Planning Advantages
In a solo-group, there are often advantages for creative and flexible tax planning. The associate will establish his/her own business entity: either an LLC or a professional corporation. If one partner wishes to purchase an equipment item that the other doctor has no interest in using, it’s up to the first doctor to finance it and gain the tax benefits as well. All direct expenses such as lab, dental and office supplies are paid by each entity. Shared expenses such as rent, utilities and common equipment leases are paid equally.

Staffing
Staffing is the major issue that needs to be carefully addressed when forming a solo-group. Often a third entity is formed and sometimes becomes the employer of all staff. A management company would be formed as the third entity. Staff would be paid by that entity. In this particular case, it is assumed that many staff members would be shared in varying proportions by both businesses. In some solo-group practices, a management company may not be established and staffs are paid by each entity. The real problem occurs when staff members are shared by both parties. If each entity employs the same staff, the employee will receive two W-2 statements, which can become cumbersome and expensive with double payroll tax costs for each staff member. Heath insurance and retirement plans complicate the situation if each entity has a different plan. It is critical to consult your accountant or tax advisor to avoid violation of any state or federal statutes that apply to these fringe benefits.

Transition Planning
Sometimes solo-groups can be as difficult to transition as true partnerships. Receiving fair market value for a retiring doctor’s entity can be a challenge. A potential purchaser has to accept the rules and regulations of the existing office-sharing arrangement as well as accept the personality of the other solo-group member. In the end, solo-groups make sense in certain cases, particularly where there may be a long-term relationship. Relative independence, which most dentists prefer, is preserved to a greater degree in a solo-group versus in a partnership where decision-making is always bound by two or more parties. Professional advice, as always, is required to determine the best path to take in the transition planning process.

Dr. Thomas L. Snyder is Managing Partner of the Snyder Group, LLC, a nationwide practice transition and financial management consulting firm. With more than 75 years of experience in the field, The Snyder Group can provide you a full range of services relating to practice transition matters and retirement planning. They can be reached directly at 800.988.5674.

If you would like additional help, email Dr. Snyder at drsnyder@thedentistsnetwork.net.

Interested in having Dr. Snyder speak to your dental society or study club? Click here.