The Dentist's Network #77

Dr. Lorne Lavine
Dental Technology Consultants
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Is Your Website An Undervalued Tool?

I’ve had the privilege of working with over 1200 dental practices over the past 10 years and I’m pleased that many of them have embraced technology for the benefit of themselves and their practices. What I find troubling, however, is that most of the websites I see out there, even ones for tech-savvy offices, are often poorly designed and implemented. In a down economy, the natural tendency for many practices is to curtail their spending, especially on marketing. I think this is a big mistake and the practices that seem to be doing the best in this economy are the ones that have increased their financial commitment to marketing. The beauty of a dental website is that it doesn’t have to cost a lot to setup or maintain. There are eight important points for any practice that is re-evaluating their presence online.

1. Understand Your Business Model
This may seem easy but many offices have not taken this first step. You need to ask yourself: “What do my patients really want, and how can I make money from that?”You’ll also need to evaluate where you are currently spending money in your practice and most importantly, how your website can support these above points. This would often be through modern conveniences like online scheduling, completing patient forms online, automated reminders, and newsletters.

2. Understand Your Customer
Notice I said customer and not patient: you need to realize that patients are consumers and they shop for dentists just like they shop for other services. Don’t discount your older patients, 65+ is the fastest growing segment of online users. You need to find marketing that will stir up emotional responses in your customers. If you don’t know what your patients want, ask them, they will let you know!

3. Lay Out The Process
There has to be a method to your madness. The protocol should be designed to get people to the website, catch their attention as soon as they get there, and make it easy to have them provide contact information. Many practices have found that free reports or other giveaways are a good way to provide a service for prospective patients while establishing your credentials at the same time.

4. Design and Content
Many dentists do not have degrees in design, so why they try to do this on their own is beyond me. There are very qualified people out there who can help you design a website that won’t break the bank. Keep it clean, keep it simple, and keep it unique. You should have photos and other pictures on the site, as long as they enhance the content and do not distract people from it. You should keep the customer in consideration here, think about what they want, not you.

5. Use Outbound to Draw People In
Remember that famous line: Build it and he will come? It’s not just a business strategy; there’s no way that patients will find you if they don’t know you are there. You will likely want to focus on more traditional methods to raise awareness of your site, such as direct mail, newsletters, postcards, etc.

6. Incentive to Sign Up
Getting a visitor to your website is half the battle, the rest is getting them to provide you their contact information. People are reluctant to do this, so you need to make them an offer. It may be access to a free newsletter, access to reports, perhaps a discount on services you offer. You’ll have to figure out what works best in your specific community.

7. Close the Sale
If a prospective patient does complete your online form, someone from your office should be following up within 48 hours…and no, email doesn’t count! It should be a live human who does this. Many offices report that having scripts makes the process much easier, as you really should have an objective in mind. A basic rule of thumb: have 3 questions and give 1 piece of information right up front.

8. Track the Number of Visitors
The area where many dental websites fail is proper tracking of visitors. There are many tools available for tracking visitors, and quite a few are free. Google Analytics and HiStats are two that I have used with great results.

9. Learn to adapt
Things that work now may not work in the future, and until you’ve tried some ideas you have no idea how successful they will be. Keep an eye on things and make changes as necessary. Websites are no longer billboards that you plaster online and wait for the calls to come. You need to be proactive and monitor it on a regular basis.

Lorne Lavine, DMD is the Founder and President of Dental Technology Consultants. Dr. Lavine holds two prestigious certifications, the A+ Certified Technician designation and the Network+ Certified Professional. These designations demonstrate proficiency in computer repair, operating systems, network design and installation. Dental Technology Consultants provides dentists a full range of services relating to the implementation of technology.

Interested in having Dr. Lavine speak to your dental society or study club? Click here. Dr. Lavine can be reached at drlavine@thedentistsnetwork.net.

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Bruce Bryen, CPA.
Managing Partner
The Snyder Group, LLC
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Buying a Dental Practice: What is the Actual Cost? Part II

Defining The Cost Of The Practice

After completing Part I of this series, the reader was ready for detailed ideas of how to reduce the acquisition price of a dental practice so a buyer would have a net after tax cost that would be as low as possible. The allocation of the items sold determine the ability of the buyer to enjoy the benefits of tax write offs that assist in determining the actual practice cost. Evaluating the dental practice is the starting point.

One would not buy a house without an appraisal. Lenders want to see the percentage of their loan to the value of the dental practice. When purchasing a house, a lender wants to advance no more than a certain percentage of its valuation. Lenders who forward sums for the purchase of a dental practice want to see an equity stake in it and not have 100% of the risk. The lender analyzes the sale price to determine if the formula makes sense.

So what about the allocation of price? When the price has been agreed upon, there is still time to discuss its allocation. This is the essence of how a buyer and seller can work together to each have a tax benefit. If there is agreement to institute a qualified retirement plan, a liability would be created so that the practice value would decrease. The funding requirement would be the buyers so that a subtraction from the purchase price could occur. The buyer has an IRS approved plan and can deduct the liability from the seller’s price. The seller defers his or her income and accumulates earnings that are taxed on withdrawal. If a qualified plan was in existence, it can be upgraded to increase a liability and give the buyer and seller an economic motivation to reduce the price.

Here are other ideas for acquisition that can save money with a sensitivity to tax allocated items: If the practice has debt, based on its legal structure a buyer can assume it and reduce the price. In this case, the seller benefits because instead of reporting the income from the higher sale price, paying taxes and then paying the debt, the practice is conveyed at a lower price and the buyer pays the debt. The seller’s net proceeds are higher because the sale price accommodates the debt. The seller’s taxes are reduced. The buyer’s cost becomes reduced, on a present value basis, because the cost after taxes is deferred for as long as the assumed debt remains. It also allows the buyer to arrange a loan at a reduced amount for the purchase because of the existing debt assumption.

Here are some other concepts to consider when attempting to reduce the purchase price to the lowest level: If the selling dentist remains in the area, or is available on a regular basis for consulting regarding the care of patients or for administrative functions, a contract can be agreed upon whereby the seller is paid for work that is being performed. The sale price can be reduced or the payment deferred to take into account this contractual arrangement. Sometimes the seller will remain for a time at no charge in order to induce the buyer to purchase the practice. These payments for services performed are available as tax write offs. This concept can greatly influence a buyer and seller to close the sale. This contract creates an obligation to the practice and reduces its value.

If the buyer is entering into or assuming a lease, there may be an opportunity to use the cost segregation method of depreciation for writing off those leasehold improvements. This creates an exceptionally quick write off for the buyer. This is an approved method of depreciation that requires some work but is well worth the effort to get a deduction over possibly five years or less rather than potentially thirty nine years.

The ability to use the structure of the practice for additional deductions is also possible in the event that it was registered in a certain format. Equipment can be purchased, for example, in one company and leased to the practice, which may be in a different legal entity.

These ideas give indications that the completion of the transition should not be finalized until the dentist knows the actual cost of the acquisition. That cost has issues that involve loan terms, interest rates and some major tax considerations.

Bruce Bryen, CPA has successfully assisted dentists with their personal and financial matters for more than thirty years. As a partner in The Snyder Group, he delivers creative and prudent financial strategies to help dentists build and protect wealth at every stage of their careers. His extensive expertise includes financing, debt restructuring, retirement planning and tax advising to help dentists keep more of what they earn. Bruce is also experienced in providing litigation support services and has testified on numerous occasions as an expert witness.

If you would like additional help or are interested in having Bruce Bryen speak to your dental society or study club, he can be reached at bruce@thedentistsnetwork.net or at 1-800-988-5674.

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Louis Malcmacher
DDS MAGD
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Let’s All Work Together

This article is about another one of my columns that was printed in these pages just a few months ago. In that last column, I strongly urged dentists to open up new vistas in their dental practices by expanding the services that they provide to patients. “Line Extensions” is a term that I frequently speak about in my lectures and I have dragged this term from general industries into the dental industry. A line extension is a new service that you can provide that fits in very well with your current service mix, and gives you and your patients new options for treatment of their dental needs. A good line extension for your practice will bring in new patients, because there are not that many dentists who offer these services in your area. It will also give you the ability to offer more services and more treatment options to your current patients. Having line extensions in your office is one of the key ways to build a successful dental practice.

Many dentists provide the same services over and over again to their patients. One day, your patient picks up a newspaper with an advertisement from another dentist who may be offering no preparation Cristal veneers. The patient thinks, “I have been going to Dr. Strangelove for the past 10 years and we never even discussed how to make my teeth look better.” The patient then proceeds to call the dentist whose number is in the ad.

You need to have line extensions for your office and you need to let your patients know about them. Learning new services that you can provide to your patients also gives you a new jolt of energy and excitement for your own professional development and for your team.

The article that I wrote a couple of months ago suggested bringing these line extensions into your office now: Narrow Diameter Implants (Atlas Implants by Dentatus, www.dentatus.com ), Anesthetic Free Laser Dentistry (Powerlase AT by Lares Research, www.laresdental.com ), Botox and Dermal Fillers for every dental office (www.commonsensedentistry.com) , and No-Preparation Veneers (Cristal Veneers, (www.aurumgroup.com). You will get excited about these services that you will offer to patients and your office will most certainly grow.

I received a few phone calls after that column from some specialists around the country. One could not believe that I would suggest that dentists expand their practices when in his words: “The dentists in my area should limit their practices to basic dentistry because I am always fixing their mistakes.” Another specialist called to tell me that, “I spent six years in an oral surgery residency and you mean to tell me that a dentist can place implants after a weekend course?”

I let each one of these doctors speak their mind and then asked them the following questions: “Are you suggesting that dentists should only be doing restorative dentistry and nothing else?” They both answered no. “Tell me the dentists who are the best referrers to your specialty practice?” They all answered that hands down, it is the dentists with the most training who are the best referrers for the implant/perio/ortho/endo cases to their specialty practices. Then I told them to go back and read my article, which specifically talks about the importance of training for whatever areas of treatment a dentist is going to add to their practice. They all whole-heartedly agreed and were pretty satisfied with our conversation.

Training is absolutely the key to incorporating line extensions into your office. No dentist should be doing anything on their patients unless they have been sufficiently trained. Successful patient outcomes are what build your practice and that only comes with continuing education and hands-on experience.

I also left these dental specialists with one more message. In dentistry, too many times we are finding that specialists are trying to limit what others may be doing, thinking that their own revenue and prestige will rise. What has happened historically in dentistry has been just the opposite – the more general dentists understand, learn, and practice orthodontics, endodontics, oral surgery, total facial esthetics with Botox and dermal fillers, periodontics, and other disciplines, we see a much greater rise in these services than ever before. Let’s all learn to work together and share our knowledge as general dentists and specialists to increase our own place as total healthcare providers and benefit all of our patients.

Dr. Louis Malcmacher is a practicing general dentist in Bay Village, Ohio, an internationally known lecturer, dental consultant and author, and consultant to the Council on Dental Practice of the ADA. Interested in knowing more about how to truly enjoy dentistry? Click here.

Interested in having Dr. Malcmacher speak to your dental society or study club? Click here. To reach Dr. Malcmacher, email him at DrMalcmacher@thedentistsnetwork.net or call 1.800.952.0521.

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