It’s vital for dental practices to take advantage of the ridiculous amount of information available through software. Here’s a list of our best tips for finding the most useful data points and using that information to make better decisions in your practice.
We live in a world where we are inundated with massive amounts of data. Business leaders across all industries have valued making the most informed decisions, and due to technological advances over the past 20 years, there is much more detailed information available, as well as software add-ons to simplify and interpret this data for us. Due to the expanded information available and the consolidation of the dental space, a new standard has emerged for data utilization in dentistry. It’s now more important than ever for dental offices to use data to deliver optimal levels of patient care, leverage an ideal cost structure, and improve team member performance.
Ultimately, a dental practice needs to collect and translate data in a way that makes sense for their specific dental organization. Here are 3 key areas where data can improve practice performance and important data points to consider in each:
Use Data to Improve Patient Care and Practice Revenue
Improving patient care and, subsequently, revenues is one of the most essential ways to utilize data in a practice. Data can be used to help an associate doctor or hygienist increase production and can help providers reach income goals by leveraging a variable pay structure.
While it’s important to note that metrics shouldn’t be measured in a vacuum, here are some data points to monitor:
- What’s a provider’s production per exam?
- What’s the diagnostic percentage? What’s the case acceptance percentage? And, how does this drive the production per visit?
- What’s the percentage of comprehensive to limited exams?
- What is the same day treatment percentage?
Use Data to Maximize Capacity
Production measures all help evaluate opportunities while the office is open, but the most profitable practices are those that maximize capacity. You can have a highly productive dentist, but if the office is only open two days per week your largest opportunity is not increasing the doctor’s daily production, but rather adjusting the access to patient care.
Consider the following:
- What is the production per operatory?
- What is the production per square foot of total office space?
If these measures are low, here are a few other things to consider:
- What are the days and hours that the practice is seeing patients? How does this match with evolving patient needs?
- Is there unutilized or underutilized space in the office? Is there excess space dedicated to waiting rooms, break rooms or doctor’s offices? (While some dead space is unavoidable, it’s important to understand these metrics and consider creative ways to utilize as much space as possible.)
Use Data to Evaluate Non-Provider Performance and Plan for Growth
It’s much more difficult to evaluate non-providers, but it should still be done. To do this, there are many intangibles and non-financial measures that you can measure.
For instance, do you evaluate office production per dental assistant or per administrative role? Generally, dental assistants are evaluated in a more subjective measure based on doctor feedback. But through this metric, you might identify opportunities for providers to be more productive with an increase or change in dental assistants. Keep in mind that when evaluating production per assistant, this can often be more reflective of how well the doctor utilizes the assistant rather than individual performance, but key metrics can still be valuable.
Evaluating production per business assistant can be similarly difficult. In looking for industry norms, it’s important to note that different organizations centralize certain processes that can make it difficult for an apples-to-apples comparison. Assuming a fair comparison, the measure should give you a fair evaluation of the efficiency in collections, insurance verification, treatment planning, staffing, and other responsibilities of the non-clinical staff and help you plan on when to add resources as you grow the practice(s).
Other Data Points to Improve Performance
All of these metrics mentioned so far can be used to create expectations in your practice and build annual organizational budgets. Then, budgets are used to evaluate relative performance and reveal more succinctly where performance has gotten off track. This will help your practice focus on the most important metrics and key areas to improve.
Using these metrics will also allow profitability measures to be compared to peer standards. There are ample resources available to the dental industry to evaluate key individual performance, as well as departmental and company-wide performance.
Here are some additional metrics to consider when evaluating the performance of the practice in comparison to peers:
- Payroll costs: How do fixed vs. variable compensation models and overall staffing levels compare?
- Dental supplies and laboratory fees: How do these cost comparisons bring to light opportunities in expense negotiations or the underperformance of a hygiene program?
- Marketing costs: Does the marketing expense percentage make sense relative to how soon you can see a new patient?
- Rent: If your rent expense percentage is comparatively high, is it due to unutilized capacity or a poorly negotiated, out-of-market lease?
The key to these comparisons is to identify the metrics most relevant to your organization and defining the expectation (along with the “why”) for key stakeholders.
Equipped with better data and better financial tools (proper financial reporting and a detailed budgeting process), these insights will allow leaders to build a practice that runs profitably and sustainably. In this way, dental organizations can begin to realize the full potential of the enterprise.