Episode 846: Unconventional Ways to Cut Costs In Your Practice

 Kiera gives listeners tips that you can implement right now to start trimming the fat on practice costs and making more money. Suggested actions include reviewing your PnL monthly, buying discounted supplies, utilizing a productive schedule, and more.

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Transcript:

Kiera Dent (00:00.686)

Hello, Dental A Team listeners. This is Kiera and today I'm so excited to be podcasting with you. I hope that you guys are loving it. I hope you're loving your life. I hope you guys are just enjoying this beautiful ride that we get to call life. If you're loving the podcast, I encourage you to please go leave us a review. Those reviews keep us as the top dental podcast out there. And our goal is to have this podcast in the hands of every dental practice out there. So please share it, tag us, leave those reviews, share this with the dentist, post it in a Facebook group. You helping us helps us reach our mission.

Um, and my goal is to just really, truly positively impact the world of dentistry. Remind us that this is the greatest profession. And today I wanted to go through some not so obvious ways to cut costs in a practice. Uh, right now I know that there is some trickiness around fees and insurances and inflation guys like, shoot, I'm in it too. Uh, I was talking to my coach the other day and, uh, we just looked back even like four years ago of what we had for job postings for certain positions. And like that's archaic fees now.

And I do think things are shifting and settling, but man, I thought let's get on a podcast. Let's do a short, quick tactical for you of some not so obvious ways of cutting costs in a practice. And if you should actually do them, because we've been seeing a lot of threads out there where you guys focus on cutting costs, but there might be another way to do it. So just diving into it, let's think about our two levers when we're looking at our costs. There's lever one, cut costs.

lever to make more money, right? I think about our own budgets, our own lifestyles, we can either cut the costs or we can increase our paychecks. Like that's really how we do it. Or we do investments or different things like that. And so when I look at this and it's crazy because when we interview consultants, I actually have a very similar question to this because I feel like most dentists realize if I want to get better production, I just need to cut my costs. But the re or profitability, excuse me, if I want better profitability, I just need to cut my costs.

But like, is that really the case? It's kind of like, let me go line item by line item by line item. And I'm sure some of us with the inflation have gone through and we've cut out the unnecessary. So I'm not saying to not look at that PNL. I do think like a few things that I'm gonna give you a tactical is number one, if you're not reviewing your numbers, AKA your PNL, AKA your profit and loss statement every single month and looking line item by line item by line item, that's a great opportunity for you. I actually do mine every single quarter. So I look at my numbers, I look at our profitability, I look at our overhead every month.

Kiera Dent (02:23.406)

and every single quarter I go through, I kid you not. Here's mine is, right here. I print out every statement and as you can see, there will be pink highlights over there of things to check. Is this our correct budget? Is this allocated correctly? Is this put in the right chart of accounts? Are we still needing to pay for this? This round, I was actually able to find like we're not using some of the pieces that we thought we were using. I cut those subscriptions. There's no reason to continue on.

Jason and I in our personal life, we only hold onto one streaming service at a time. So we'll rotate between Netflix and Paramount Plus and Hulu because we feel like if we have all of them, we're not even utilizing all of them. So using one just forces us to use that. Then we shut it off, open up another one, shut that one off, open up another one. And it's crazy and that works for us. My husband's also very, very, very, let's say conservative, cheap, whatever you want to call him. But I actually love that it's a solution I had never thought of.

And so in your dental practice, like, is there a way that maybe we don't have to pay for all the things and we could get a little more creative with it. But again, like a streaming service is like $10. And I'm not to say that 10 or 20 or 30, don't worry, I know Netflix is like clear up there on the 30 a month. That doesn't seem like it's going to be a lot, but every penny does count up. So when we're looking at cutting costs, I really do say like, let's not cut unless there's a way that it's actually going to move the needle forward. Like,

In our Tesla, we were paying $10 a month for the car karaoke. I was obsessed with the car karaoke when we first bought the car, but guess what? It was novelty and it wore off and I've just been paying $10 a month. And I looked back, we've owned our car for two years. That's almost 250 bucks that I've just been paying and not even using. So those are the types of things to cancel if we're not using them. So that's one way to cut costs. And I do believe you should do that. So check your numbers every single month and then also run your PNL quarterly just to see is there.

anything that I can possibly get rid of that we're not using that's moving us forward. The next thing that I see of cutting costs is using a company like Synergy or GPO, or it's a group practice, where you're able to get discounted rates on your supplies. I love Synergy, I recommend them. Be sure to tell them Dental A Team sent you. But Synergy helps a lot because what they do is you're able to still use Darby or Patterson or whatever one you're using.

Kiera Dent (04:39.662)

but they just have so many dentists buying that they're able to basically get it in bulk. Kind of like what you would see at Costco, where we're able to get reduced pricing on things. Like you guys, I went and bought a beach towel at Costco the other day because at this other grocery store, it was like 30 bucks for not even as nice of a towel. And Costco had these awesome towels that were super fluffy and way bigger for 10 bucks. Well, how am I able to get it that much cheaper at Costco? It's cause there's lots of us paying members.

and we're able to get that price reduced. So synergy is a great way for you to get your supplies cut lower. And then also one thing I love is putting all of your expenses in the P &L into what I call the overhead calculator. And we do have an overhead calculator. You guys are welcome to reach out. Hello at thedentalityteam .com to get that. And anyone who books a call with us, if it's relevant, we definitely give you that overhead calculator. So I want you guys to be able to get that.

But what's really cool is you take your PNL, you put it in based on the industry standards to see where am I high? Which, which category is it? My payroll? Is it my supplies? Is it my labs? Like what category is high? And then can we go dive into that on the PNL and find out why is it high? So that's honestly where I feel like, yes, you can cut costs. I'm not pro cutting team right now. You guys team is coming in usually between 28 and 35 % of your collections every single month. Like it has gotten so much higher than even when I started dental a team.

but you do need people. Preventing turnover is going to keep your costs lower because when you lose somebody, you have to replace them with usually somebody who's gonna cost you a lot more. That's not saying to underpay people, I want you to be fair wages and to be like more than fair and to be in the highest realm so you keep the great people. But what's interesting about it is guess what? The reality is turnover is gonna be one of your biggest costs. Like it's the human capital cost that's gonna bite you in the booty if we don't have a great culture. So,

do our one -on -ones, invest in that, have team bonding activities, make it a great place where people want to work. That doesn't mean we don't have accountability. It does mean we have accountability, but we make it a place where people really do want to be with us. That is like some costs that we can cut. You can also look at your merchant fees and there is a company called Dental Merchant Advocate. Be sure to tell them that only team sent you and you can actually look at your credit card fees and get it reduced and they can help you reduce those merchant fees. I'm seeing a lot of offices say like,

Kiera Dent (06:56.334)

There's no charge for ACH in cash or check, but there's a 3 % fee for credit cards. I have mixed feelings about that. Do I really want to nickel and dime people? Maybe. But is there other ways that I could do this? And the other side of it is increasing production. And I feel like people are like, I just want to go cut because I can cancel that subscription. It almost feels like taking a diet pill. But my $9 .99 on Tesla is not going to offset my 40 % of payroll costs.

It's not. And so what do we need to do instead? The other side is we produce more. And the way you produce more is not saying you've got to work more. I want you to hear me really clear. Producing more does not mean you have to work more. Producing more is we need to work smarter. And I'm obsessed with, you can call it productive scheduling, you can call it block scheduling, but it's like making our days where they're very productive and they're very easy. So we make an ideal. We say, how much do we want to actually do?

And what do we do from there is we look at it and we say, all right, I want to do a crown. I want to do a root canal. I want to do all these things. And I go off of my lowest insurance fee. Let's not go off of our office fees, but let's go off of our lowest or our more average one. Like most of the time, our crown is this amount. Most of the time a root canal is this amount. Most of the time, and again, we're not going high. And if your lows are, your fees are really low, maybe I'd consider cutting that one insurance plan.

but we want it to be being paid fairly for, otherwise it becomes very hard and you do have to produce more. And so looking at that, is there a way I could possibly drop one of my insurance plans, get them on a membership plan and be able to be producing more that way? A lot of people also are like, well, I've got to just go fee for service. And I think there's a middle ground. You for sure can go fee for service and I'm not here to tell you not to, but what I am saying is fee for service then becomes tricky because you've got to pay a lot more for marketing and people don't realize that. Your insurance fees are your marketing budget right now, just so you know.

And if you can get that many patients on a marketing budget and you're willing to do that, but please don't, please do not kid yourself that you're like, Oh, well I'm now fee for service. You have to now work your freaking booty off to get these patients in. Please, please, please do not miss that mark. And so if you're really good with marketing and you're getting them in because insurance just allows you to have so much more access to people and they come to you because like I have met life or I have Delta. So I'm looking for it. Then I look at the reviews and I come to you. So.

Kiera Dent (09:16.078)

That is a huge piece that's driving patients to you that you don't realize. So what I mean is productive scheduling is actually the best way to do it. So looking at what do I need to do? I have added millions and I'm not kidding millions of dollars just by making a more productive schedule. Um, I've added in over 20 grand a month and they did not work any more days and they actually were able to have a less busy schedule because what I do is I play the game of math and I look at it and I say, all right, this is how much a crown is root canal. We, we do all the procedure makeup.

We build a whole schedule based on how many procedures you're already doing, how many new patients you're already seeing, how much per year you're already doing, or how much we want to be doing. And we block it in and we actually figure out how much each day is worth, like dollar wise, if we were to follow this ideal schedule. And what's crazy is when people then start looking for patients like puzzle pieces and we say, oh, you have a crown. Dr. Smith actually does his crowns on Mondays or at eight o 'clock or on Thursdays at four o 'clock, which works best for you.

And now I'm not saying, Hey, what day works best for you? I say, Dr. Smith does this. This is when they're the most, this is when we do our crowns and I schedule you think of yourself like scheduling surgery instead of that. We are just scheduling a massage. We are specialists. We are people that can stick to a schedule. My surgeons, the doctors, they do not just take me whenever I'm available. They say, this is when we're available. When can you come in? But at a massage place or a hair place, they're like, Oh, what day works best for you, Keira.

That's not who we are. We are specialists and if you start to train your team to do this, you guys can actually have a much more productive schedule. And if all of us are looking for that, blocks are held for 24 hours. That's my rule. So tomorrow at nine o 'clock, if it's not filled, I fill it with something that's close to that, a toothache or whatever that dollar per hour production needs to be. I also have my hygiene team reporting their dollar production per hour, making sure that we're hitting those marks. What can we do? I'm also looking to see, do I have enough perio in my schedule? And are we diagnosing enough perio? Are we doing bloody profis?

If I've done all these pieces and I'm truly doing them, the next question is doctors, are we diagnosing enough? If you wanna be producing 100 ,000, the goal usually is that you need to produce three times, you need to diagnose three times as much as you want to produce. So if I wanna produce 100K, I need to be diagnosing 300 ,000. That's the stats, that's what we see typically. And so looking at that, are you diagnosing enough? Are we watching everything? Are we actually diagnosing?

Kiera Dent (11:40.11)

Are we putting a lot of watches on things? And I'm not here because there's another article that I said of, are people over diagnosing? And I don't think that they are. I think that there's some people who are, but I think that there's another piece on it of, are we making sure that we're actually diagnosing and not just watching things? What are we watching? We're waiting for that decay to get worse. Like it's there, it's present. You know there's decay. Why are we not getting rid of it? And so I feel like getting that confidence of this is where it is. And if you're struggling with that, then get Pearl AI or Overjet AI.

to where now you have AI that's also backing you up and saying, this is what you have. It's black and white and there's no questions. I think that investment, tell them Dental A team sent you, we do have affiliated fees with them. My thing on affiliate fees is I always just ask them to give you guys the lowest deal. So please just mention Dental A team. That way they know we're sending people to them. But the piece is, if you're going to do this and you're struggling with that, get AI on your x -rays. Use them because you can diagnose easier and more confidently. That way it's not just you.

trying to convince your patient they need this. Also assume that the patient wants to do the treatment. Why are we sitting here like, I feel so bad to tell them they have a cavity. I would rather you tell them because Kyra Dent here did not floss. And someone finally told me, Kyra, you've got to start flossing. And let's start it as an Easter resolution. And I kid you not, I have gone five, six, seven, 10 years. Like however long it's been since that one person told me that I needed to do this and gave me a plan and helped me get there to where I floss every single day now.

Simple things like your job is to tell them these pieces. So, um, thinking about how can we just make sure we're diagnosing enough that we're educating our patients and that we're really looking at our diagnosis and then our acceptance rate too. Let's look at our case acceptance. Are we the diagnosis that we are making? Is our team closing them? And if they're not closing, let's look for the patterns. What cases are we not closing? Which treatment coordinator is not closing? Which hygienist isn't closing? Looking for the patterns and then role playing, fixing it, looking for the hygienists that are doing the best on perio.

listening, having them record when they are presenting it to a patient so we can actually hear it. Those are ways that we cut costs, aka increase our production so we don't have to cut costs. Also just knowing your BAM, bare ace minimum. What do we, if we have $50 ,000 worth of expenses, ideally I would love you to truly 1000%. I said truly 1000%. I would love you to look at this and I would love you to see.

Kiera Dent (14:06.542)

All right, what do I need to do to get our acceptance up? What do I need to do to help with that? And when we look at all of this, it just boils it down. It breaks it down. Having a treatment tracker, looking at our diagnosis and acceptance rate, looking to see what patients are not closing cases, recording things, role playing, training, teaching, but we either cut costs or we increase production. Let's make sure that we have a productive schedule.

And if this feels overwhelming and daunting to you, high five, you're in the right place. Reach out. Hello at thedentallyteam .com. This is what I geek out about is helping offices get this in place so you don't have to cut costs. So going back to that example, I don't think I quite finished that. Your costs are 50 ,000 a month. Like you look at everything. You, I want you to be at 50 % overhead. So that means we need to produce a hundred thousand. So if my costs are 80 ,000, what's 80 times two? You got it. 360. Okay.

So whatever, or excuse me, 80 ,000, 160, there we go. Okay, whatever it is, you just double it. If my costs are 100 ,000, I need to be producing 200 ,000. Then I look at if it's 200 ,000, that's my bear ace, like I've got to get that done. I go look at, I work 20 days a month. That means if it's 200 ,000, I've got to be producing 20K a day. If I have three hygienists, each hygienist needs to be producing probably 1 ,000 to 1 ,500 per day.

then I need to figure out doctor schedules and how do I make that to where it actually works? And you basically just turn it into a puzzle.

Do you guys feel like I'm on a rant? I feel like I'm like just so passionate about this and I want you all to do it because you don't have to just penny pinch costs. You need to do that as a smart business owner, but we also need to be looking at diagnosis, acceptance, productive scheduling, and then also looking to see where can we refine each of those pieces. Now, if we're doing all of that, then there might be ways that we can actually add on materials fees or lab fees, which are totally legal and allowable with insurance, but that's gonna be up to you. So guys, if we can help you with this, these are some tips of how you can cut costs.

Kiera Dent (16:04.59)

in a non -conventional way. And I don't think people often realize there's two levers. I cut costs or I increase production. Which lever do I want to pull? Which one can I use? And honestly, this is how I'm able to cover our fees as a consulting company. Every time you joined consulting, we cover our fees 100 % plus some, because we're able to put this in there. 20K to your schedule in a month, adding in multiple thousands and millions of dollars just by being able to help you build a schedule that's productive.

And then we look for those puzzle pieces, AKA patients. We focus on being a specialist versus a massage place. We focus on realizing we direct our patients rather than being directed. We realize that an ideal schedule for us is an ideal schedule for our patients. These are the pieces that are going to drive your practice forward. And we can definitely help you reach out for a free strategy call. Hello at thedentallateam .com. Go to our website, thedentallateam .com. Book on that, book a call. It's 15, 30 minutes, very short. We'll give you a ton of value. And I can't wait to welcome you into our family.

Guys, go figure out ways to cut your costs, be the CEO, own your company. And with that, thanks for listening and I'll catch you next time on the Dental A Team Podcast.