How to Identify if You Are Losing Money as an In-Network Provider

When you first opened your dental practice did you think it would be possible to see patients all day long and lose money? Many owner-doctors can’t wrap their head around this phenomenon. We see the patient, we get the check, we made money, right? Wrong! Many in-network PPO contracts are now reimbursing the offices below the cost of offering that procedure. So how do you figure out if you’re one of these practices? Start with your hygiene department.

Have you ever stopped to calculate what one hygiene visit costs you as the owner? Well, let’s start with how much you pay your hygienist. National averages can vary, but typically hygienists get paid $35-$40 an hour. What else goes into a hygiene visit? The supplies needed to clean the patient's teeth (bibs, tray covers, prophy cups, angles, etc.) cost the average practice about $10 per visit. The equipment you use to see the patient (chairs, lights, cabinets, etc.) generally costs the practice about $10 an hour if you look at a 20-year lifecycle. The utilities needed to run the practice cost about $10 per hour per operatory. Once the patient leaves the operatory, your front desk team walks them out, submits their claim, and checks-in with the insurance company when something is declined. If you work with your team, you’ll find out that sometimes claims are seamless, and other times they spend three hours on the phone finding out why something was denied or where a check was sent. The average office spends $7-$10 on labor, per claim, to ensure the office gets paid properly. That tells us that you need to make $72-$80 on each hygiene patient just to break even. It’s important to note that the fee paid for a D0120 should not be calculated in this time. The fee paid for the exam also has a cost associated with it that isn’t included in this analysis.

Now go back and look at your last ten in-network patients. Without D0120, did they reimburse you more than $72-$80? The amount above that number is your profit, and the number below is your loss. If you’re seeing claims come through for $50, $60, or even $70, you’re hemorrhaging profit as a result of your in-network agreements. Factoring in cancellations, you really need to be somewhere around $90-$100 in reimbursement per claim to ensure profitability.

You’ve now gotten to the realization that PPO contracts may be killing your practice. Fear not, because Empower DDS has the solution to your problems. Our teams can help you figure out a path to profitability. If going out-of-network is a need, we can assist there too. Our platform will help you develop a better relationship with your patients, restore profitability to your practice, and enrich your overall provider-patient relationship.

Are you ready to take control, and learn more about how improve profitability for your practice?

Get in touch, we'd love to show you a demo: Your dental services as a subscription. - Empower DDS.