With the future unforeseen at this time it is good to have a plan in place for peace of mind. To have a successful business cash flow obviously is important. It can also be one of the largest stresses and even more challenging for dental practices. Practices with irregular cash flow see problems in every aspect of their practice, from marketing to payroll.
If you’re experiencing these issues in your dental practice, there are many things you can do to fix the problem.
I recently asked some practice owners in Utah, “What payment options do you provide for your patients?” Several responded that they send patients a credit card form in the mail with their statement. Patients then fill out the form and mail it back to the practice. Some offices reported that it took 60 to 90 days to collect. Practices were waiting on the client to get around to filling out the form (while admitting that some patients are not comfortable with this process), and then get it into the mail. This method is antiquated and inefficient. Today’s technology provides a much more viable option that allows patients to pay via your website. Then you have the funds within two to three days instead of two to three months. Start accepting payments on your website today and improve your cash flow.
Start a Reserve Fund
Many of the practices admit their businesses have no form of reserves. This can be a difficult process to tackle, but absolutely worth it. Start small and begin to put money away for a rainy day. This reserve can help your practice get through slow revenue periods, help cover employee salaries, order supplies for procedures, or invest in marketing and other growth opportunities. Neglecting any of these things can result in poor service, which will drive patients to other practices.
Cut out the Middle Men – Insurance Companies
A big thing that can get in the way and affect your profits and revenue stream. Insurance companies can hurt your cash flow and cripple your profit margins. There can be difficulties working with insurance companies as well as collecting from patients.
Over 180 million Americans don’t have dental insurance. Many I’ve spoken with feel as though it’s a waste of money and has very small benefit to them. While this is absolutely a problem, it can be an opportunity for your practice. Some dental practices I’ve worked with see the flaws in the dental insurance system and have opted to provide an alternative via in-house membership plans.
Create a Dental Membership Program
There are many benefits to creating a membership program for your company. Creating an in-house membership plan will give your practice recurring revenue every month while helping patients gain access to the dental care they deserve and more likely to say yes to easy and affordable dental care. These plans involve some setup and ongoing maintenance. There are membership software options available to help you with this process. Automate collections and collect on the 1st and 15th of every month from all membership patients so you have cash infusions before payroll to pay your team and overhead.
Create a High Yield Savings Account
For for your reserve funds as you build reserves for your practice you want to have to automatically grow revenue (look into high interest accounts 2-3%).
A high-yield savings account can be a useful middle ground for your money, offering protection of your principal, the safety of federal insurance, and a yield that’s higher than a regular savings account, though less than you could potentially earn from riskier investments. Just be sure to think through how one or more high-yield accounts can best serve your financial goals and situation, and then do your homework to find an account that will maximize your earnings at the same time as avoiding fees or imposing restrictions that don’t fit your needs.
Utilize Patient Financing Options
Care Credit is a financing tool patients use to get the financing they need. Care Credit is a wonderful option and can really help your practice collect a lump sum of payments as well as help your patients receive the care they need. Care Credit should be used as a first solution to patient financing. They are a great partner for your practice and can help your practice increase case acceptance.
If your practice is experiencing cash flow issues, I hope you’ll consider these suggestions. These ideas may not be the golden ticket to end all your problems, but they can be a great start in improvement. If you are interested in learning more about how BoomCloud can help your practice manage both membership programs and payment plans for treatment, I suggest you schedule a quick live demo with our team.