Monday, October 30, 2017
For years, dealing with insurance companies was a necessary evil for many dental practices. Accepting insurance generated income and increased chair time, but at a steep cost. Dental practices and patients are now doing something about it.
Dental practices are very frustrated with the hassles brought on by insurance companies and struggle due to low reimbursement fees and complex claim processes. Insurers can take as much as 40 to 50 percent of all payments made by a patient and, to add insult to injury, their complicated claims processes often result in delayed and denied payments. This, combined with treatment limitations and pre-approvals, costs a practice valuable time and money that could otherwise be used to better serve patients and improve practice profitability.
The result? A new era of dentistry where growing a profitable insurance-based practice is next to impossible.
Consumers find dental insurance too complex, too expensive, and are put off by its extensive limitations. Unless subsidized by their employer, most consumers, regardless of age, do not buy dental insurance. As a result, 40 percent of adult Americans do not have dental insurance and many out of this group avoid the dentist because of high cost or the perception of high cost. This is especially true for younger adults who are not offered dental benefits at work and older adults who lose dental benefits when they retire. Unfortunately, these consumers aren’t getting the regular treatment they want and need.
So, what is the financial impact on your dental practice, and your patients, when you’re dealing with the barriers created by insurers? The math is not pretty. Insurers can take up to 50% of all payments made by a patient. And, according to a recent ADA brief, An Analysis of Dental Spending Among Adults with Private Dental Benefits, fees paid to dentists through private dental benefits plans are significantly lower than market fees. The study also concluded that the total copayments, coinsurance and premiums paid by 69% of adults with a dental benefit exceeded the market value of the dental care they received.
To stay viable you have to adjust and change the way you’ve been running your business. Some dental practices are moving away from insurance and instead embracing value-based care, a model that’s winning increased popularity in our industry.
This brings me to in-house dental membership plans. Membership plans offer dentists and patients an alternative to insurance and enable you to generate more revenue and profit. These plans allow patients to become a “member” of your practice by paying a flat fee to cover their basic preventive and diagnostic needs while also providing patients with price information on the restorative and specialty treatments they might require. Membership plans also can help practices improve treatment compliance of existing patients and attract new Fee for Service patients interested in finding a dental care plan that is simple and affordable.
While these plans remove insurance from the equation and come with many additional benefits, they don’t come without issue. To provide an improvement for insurance-based practices, these plans must be simple to administer and easy for both staff and patients to understand.
The solution is a new generation of cloud-based dental plans that are extremely easy to set up and administer. A cloud-based solution simplifies patient and membership plan management and eliminates all of the paperwork, follow-up and headaches associated with paper-based plans. Some of these cloud-based platforms can be customized specifically to your practice’s needs and come with extra features that help you improve existing patient loyalty and attract new patients. The ultimate goal of these cloud-based platforms is to put you in control of the practice, improve revenue and profitability, and minimize the overhead associated with managing your own membership plan.
But implementing an in-house membership plan is not a magic bullet. Existing patients will not automatically begin accepting more treatment and new patients will not just start flooding through the front door. You need to market these plans to existing patients, dormant patients and new patients. It’s very important that the company helping you build an in-house plan provides marketing support to get the word out. This should be a committed partnership for both parties, where everyone does their part to make it successful.
And then there’s pricing transparency. If the Internet has accomplished one thing better than any other, it’s the ability for consumers to get access to pricing for almost any product and service. From real estate to automobiles, the Internet has made pricing transparency a consumer expectation.
The great news is transparent pricing has served to grow markets because consumers are more apt to make a purchase when they feel informed. Dentistry is no different and is an industry that can really benefit from pricing transparency. Our research shows patients are very ill-informed when it comes to dental pricing and are pleasantly surprised when they understand how it works. They realize dental care is not out of reach. As a result, the newer, more progressive in-house plans are now offering pricing transparency as a cornerstone of their platforms.
Take Kleer for example. Kleer’s HIPAA-compliant cloud-based platform allows you to select from five care plan templates, create your own fee schedule, and set your own subscription price. By connecting dentists directly with patients, the platform allows you to keep about 90 percent of all payments made by a patient. As an online system, Kleer is designed to make managing plans and patients simple and efficient. In addition, Kleer includes marketing support and helps promote price transparency via benchmark pricing from FAIR Health.
The bottom line is this: In-house dental plans can help your practice increase revenue AND profitability while improving patient loyalty. That’s why savvy dental practices are looking at implementing their own in-house dental membership plans. Don’t let your practice fall behind!
Dave Monahan is the CEO of Kleer, a cloud-based dental care platform that connects patients directly with dentists.