How Healthy Is Your Practice?
As a dentist, you are constantly assessing the overall health of each patient. To do this, you use a variety of methods, technologies, and established procedures to diagnose and treat patients coming to you for care. You also draw upon your previous experience with each and every patient when determining what each one needs. This mental “database” is unique to you and is a critical part of your ability to provide treatment and healing.
In a similar way to how you call upon all of your expertise and resources in caring for patients, there are also important metrics, procedures, principles, and tools that can help you assess the health of your dental practice. Not only can these Key Performance Indicators (KPIs) help you diagnose what’s happening in your practice, they can also be used to help you improve the health of your practice.
At Dental Intelligence, we work with thousands of providers around the country. We frequently hear some variation of the following from them: “Which numbers should I be paying attention to?” This question reflects the commitment these providers have to improving their dental practice. However, in spite of investing significant expense, energy, and effort into understanding which metrics matter and why, many of these providers are still searching for answers.
Focusing On The Right Things
Dr. Craig Spodak, owner of Spodak Dental Group in Delray Beach, Florida, was one of these frustrated practice owners trying to use metrics to improve patient care and team performance. He went so far as to spend significant resources in building a custom solution to gain insights into the health of his practice.
During this process, he learned about Dental Intelligence and what we do to help practice owners and teams use data to grow their practice. After implementing our tools and processes, Dr. Spodak began to see improvement. The key for his practice to grow was understanding which metrics mattered and what to do to positively influence them.
At Dental Intelligence, everything we do is based on our Profitability Formula®: Our goal is to help you start thinking about where your practice is today and to then determine what steps can be taken to improve.
The Five Most Important Metrics
Here are five metrics, based on our Profitability Formula, that every practice should be measuring.
- Annual Patient Value: Are we increasing the value of our patients? Annual Patient Value is determined by calculating collections per patient for all active patients. If APV is increasing, it’s a great sign that you’re increasing the value of your patients, meaning they’re receiving more of the treatment they need. Determining APV gets rid of a lot of the “fluff” around gross production.
Knowing the annual value of each patient helps you accurately answer questions like “Is my practice healthy?” “What am I collecting per active patient?” “Are we seeing our patients enough?” and others. APV is an important lagging indicator. If you look at this compared to Production Per Visit (PPV), you can see deeper into the health of your practice.
For example, if your APV was $600 and your PPV was $325 — this means you’re seeing your patients at most two times annually, which indicates there is likely a lot of unscheduled treatment & production sitting in your practice management software. This is a really good metric for determining the health of the practice and relates directly to the next two metrics you should be tracking.
- Pre-Appointment %: This metric is determined by looking at your active patient base to learn how many of them have a future appointment. This tells you not only whether or not you’re getting new patients, recurring patients, etc. but also how many of them have a scheduled next appointment.
This greatly impacts visits because if your pre-appointment % is low (30-40%) it means a lot of your active patients aren’t coming back, meaning you’re not utilizing the visits that as well as you could be, so your ability to increase production and visits is diminished.
- Production Per Visit (PPV): This is one of the top metrics to look at. PPV helps you identify how much and what kind of treatment you’re providing. Are you decreasing, are you seeing lulls, are you seeing cyclical patterns? I recently received an email from a dentist and dental study group leader in Pennsylvania asking for industry benchmarks (see below) to help the many dentists he works with understand why they’re seeing a decrease in production.
Measuring PPV lets you see if the volume of patients is decreasing or if this is caused by patients accepting less treatment. It also helps you identify at what rate you are getting acceptance of treatment and helps you see how you’re doing in overall treatment in relation to your patients.
- Hygiene Re-Appointment %: How are you doing daily in re-appointing patients who came in for hygiene? How did you do yesterday with getting your patients back in the practice, scheduled for hygiene? This also impacts annual value.
- Periodontal Treatment %: This helps you see from a preventative side how you’re doing as a whole, which drives production per visit. Are you increasing the amount of hygiene care you’re providing? This also drives hygiene production per visit. If you’re not finding perio-related opportunities, are you finding restorative production? And how are your hygienists doing in co-diagnosing this type of treatment?
Where Should I Begin?
Once you start tracking and understanding the meaning of these five metrics, you can then start drilling down into your case metrics, like treatment dollar acceptance percentage, patient acceptance and patient diagnostic percentage. These are the hardest KPIs to change but will also provide you with the clearest window into the health of your practice.
Once you have a firm grip on these metrics, you can also start delegating responsibility to different team members to take ownership of the different metrics. For example, your hygienists should be at a periodontal treatment percentage of 35% or better.
So, if there was one metric to start with, it would be production per visit. Where are you currently at on PPV? Calculate this for each month. Figure out where you are at here and begin building from here. Be sure to calculate for this year and last year. Where do you think you should be? Where do you want to be? The benchmarks below can help you compare. Are you where you want to be, and if not, do you know what to do to get to where you want to be?
Metrics help you start to correlate your data with personal and team member behaviors. This then gets you to your case metrics, which can vary day to day depending on the patients coming in and how healthy their teeth are, but still open a wide window into patient health and practice performance.
Once you know where you are, you can begin setting goals to impact your production per visit, which will drive your annual patient value. Exciting things are sure to begin happening.
If you're ready to learn more about how data can help your practice to grow, request a free demo of Dental Intelligence today. We're here to help you!