If you’ve ever tried negotiating fee schedules with insurance companies, you probably know it’s like arm-wrestling a sumo wrestler—slow, exhausting, and you’re not entirely sure it’s worth the effort. But here’s the kicker: it is worth it—if you do it right.
Let’s dive into how renegotiating dental insurance fees can skyrocket your average revenue per patient (ARPP), why you should pair that strategy with a patient membership plan, and how BoomCloud™ helps you slay the profitability game.
Average Revenue Per Patient: The Holy Grail of Profitability
Why does ARPP matter so much? Because every dollar you’re not making per patient is a dollar of profitability flushed straight down the drain. Most practices live and die by this metric, but here’s the catch—PPOs love to choke your ARPP with fee schedules that make ramen noodles look luxurious.
Let’s break it down:
- PPO Patients: Average revenue per patient is often a measly $500/year. That’s because of low reimbursement rates, write-offs, and red tape.
- Membership Patients: Average revenue per patient can shoot up to $2,150/year. Yep, that’s 4X higher, thanks to no write-offs, higher case acceptance rates, and loyalty-driven spending.
Renegotiating fee schedules is a huge driver of profitability, but there’s an even bigger game-changer hiding in plain sight: membership plans.
Step One: Negotiate Like a Boss
Negotiating fee schedules isn’t for the faint of heart. Here’s how to tackle it without losing your mind:
- Know Your Numbers: Analyze how much you’re writing off due to low PPO fees. (Spoiler: it’s probably enough to make you cry.)
- Leverage Your Value: If you’re crushing it with patient volume, use that as leverage to negotiate better reimbursement rates.
- Get Expert Help: My buddy Ben Tuinei over at Veritas Dental Resources is the king of insurance negotiations. He can help you fight the good fight.
Even if you win the negotiation war, you’re still working within the confines of PPO limitations. That’s why it’s critical to also diversify your revenue streams.
Step Two: Build a Membership Plan That Pays (Literally)
Membership plans aren’t just a trendy buzzword—they’re a legit strategy for escaping PPO purgatory. Here’s why they’re a big deal:
- No Write-Offs: Membership patients pay you directly. No insurance middlemen. No red tape.
- Predictable Revenue: Monthly recurring revenue (MRR) smooths out your cash flow and keeps the lights on.
- Loyalty That Lasts: Members are more likely to accept treatment, show up for appointments, and refer their friends.
Case Study: Smile Oasis Dental’s Membership Revolution
Smile Oasis Dental was stuck in PPO quicksand—low reimbursement rates, high write-offs, and a constant struggle to stay profitable. They decided to renegotiate their fee schedules and launch a membership plan with BoomCloud™.
The Results:
- Membership Patients: 1,238 active members paying $45/month.
- Monthly Recurring Revenue (MRR): $55,710.
- Annual Recurring Revenue (ARR): $668,520.
- Average Revenue Per Patient (ARPP): $2,175/year.
By pairing better insurance reimbursements with a booming membership plan, they doubled their profitability in under a year.
Why BoomCloud™ is the MVP of Membership Plans
BoomCloud™ isn’t just software—it’s a profit-generating machine. Here’s how it helps you dominate the membership game:
- Automated Billing: No more chasing down payments. Patients pay you every month, like clockwork.
- Customizable Plans: Create membership options that fit your practice and patients.
- Metrics That Matter: Track MRR, ARR, and patient growth in real time.
BoomCloud™ takes the headache out of managing memberships, so you can focus on scaling your plan and watching your ARPP soar.
Step Three: Use Both Strategies for Maximum Profitability
The magic happens when you combine renegotiated fee schedules with a thriving membership plan. Here’s why this dynamic duo is unstoppable:
- Insurance Optimization: Even if you’re still in-network, higher reimbursement rates mean better ARPP.
- Membership Freedom: Membership patients provide recurring revenue and reduce your dependence on PPOs.
- Revenue Diversity: A balanced mix of insurance and membership income protects your practice from economic swings.
The Bottom Line: Negotiate, Build, Thrive
Negotiating fee schedules with insurance companies can boost your revenue, but it’s only part of the profitability puzzle. Adding a patient membership plan is the ultimate power move, giving you higher ARPP, recurring revenue, and loyal patients who actually love your practice. I recommend you hire Ben Tuinei from Veritas Dental Resources to help with the negotiation process.
So, grab BoomCloud™, get negotiating, and start building a practice that’s as profitable as it is stress-free. Your ARPP—and your sanity—will thank you.
