Dean Hallows, commercial director at DPAS, looks at the advantages of practice-branded dental plans.
As anyone involved in business knows, stability is one of the key factors that support confidence and growth. Recently, positive figures have come amidst predictions from the International Monetary Fund (IMF) that the UK will remain one of the world’s fastest growing economies during 2014, surging to 3.2% growth by the end of the year (The Guardian, 2014). Such news is welcome for all UK businesses, including small owner-occupier organisations such as dental practices, which rely on the prosperity of the general public to fund their services and buy their products.
But the important question now is not whether statistics and centralised bodies predict growth, but whether the general public really feel positive about the future? Yougov research, conducted in June 2014 (Yougov/Cebr HEAT, 2014), found that although consumer confidence is at its highest level since 2007, there is wide geographical disparity in where the economic optimism is being felt most, with London and the south east forging ahead of the rest of the country. So whilst general confidence is increasing it is not necessarily being felt in every area of the UK.
However, with these positive economic undertones in mind, it is worth considering those business tools that practices can use to help encourage patients with increasing levels of disposable income back into the practice. The challenge for practice owners is to re-engage with these patients and persuade them that returning for regular treatment is in their best interests.
One fact that became very clear throughout the recession was that practices with dental plans found patients much more likely to continue with routine care, resulting in fewer postponed appointments and thereby ensuring a much higher level of financial stability.
The increase in ‘self-imposed’ extended recall intervals became a real issue during the recession, as patients extended the time between routine appointments. Now that financial constraints are easing the time has come to reinvigorate regular attendance, rebuild patient loyalty and ensure that budgeting for dental care is back on patients’ list of priorities.
A practice-branded dental plan provides a particular focus for your ‘brand’, adding value and encouraging a sense of ‘belonging’ amongst patients. Dentists build a sense of trust with their patients and they consequently take notice of professional recommendations, be it to do with treatments, the brand of toothbrush they should buy or the decision to join a dental plan. A plan linked to the practice is likely to be more highly regarded than a national brand simply because it comes with the backing of the dentist.
Dental plans have many benefits for practices, not least in terms of improved cash flow and by guaranteeing a steady income throughout the year, but they also offer important advantages to patients, first and foremost enabling them to budget for routine care. In addition regular check-ups and hygiene appointments will improve overall oral health and give dentists the opportunity to spot any potential issues that could become bigger problems if left untreated.
The financial stability that comes with having patients registered on practice-branded dental plans adds value to the practice, an especially important consideration for anyone considering their exit strategy, as these patients who are returning on a regular basis give tangible and measurable value to the business.
The value of a guaranteed income stream can also be important when it comes to securing funding from financial institutions for equipment and/or expansion. Since the economic crisis many dentists have found banks unwilling to lend as freely as in the pre-recession years. Banks and other lenders now want to see far more substantive business plans and require proof that sufficient income is being generated for the loan to be repaid. Being able to prove numbers of patients on plans strengthens the case for the viability of your business, making loans easier to obtain.
Building a brand
Many practices have already found that offering practice-branded plans adds tangible value to their brand, offering plan members the ability to budget for their dental care, as well as benefiting from discounts on further treatment.
Most practices need some help to develop their brand, which requires consistent and high quality communication. Advice is of course available from external agencies, but as part of our flexible and comprehensive service we supply marketing and patient recruitment support tailored to each individual practice. This includes consultancy, training, design and print; in fact everything required to ensure your dental plans are promoted effectively and consistently in line with your brand.
Annual fee reviews
When it comes to setting fee levels it’s important to remember that not all practices are the same and being offered one fixed fee schedule does not necessarily fit all requirements. Your dental plan provider should work closely with you to ensure that the fees charged are exactly the right fit for your practice, ensuring that the plan remains profitable and competitive with fee-per-item charges, where necessary taking into account the changing costs of the business. DPAS’ annual fee reviews are carried out by business development managers, with the support of a dedicated office-based team, meaning every practice can benefit from our many years of market experience.
When it comes to financial matters, it’s important to work with an established organisation with a proven track record that can support you and your practice. Launching plans for the first time or changing plan providers is a process that needs to be carefully managed in order to maximise patient take-up. Working with a plan provider with many years of experience, which has been through this process hundreds of times, is crucial in ensuring the success of the plans and gives the principal and the practice team confidence and reassurance when taking this important step.
Dental plans are designed to make everyone’s lives easier and a poorly planned transfer can undermine confidence in the plan itself. This can easily be avoided by selecting a plan administrator that has the resources and experience required to make sure the plan succeeds, from providing support with patient communications to ongoing team training, while always being on hand to answer queries during the changeover process and beyond.
As the economic and political landscape evolves, dentistry will find itself affected by a number of factors outside its control, so it’s vital to monitor and manage as many key variables as possible. There are many benefits of dental plans applicable to all types of practices and these can help you take advantage of increasing economic optimism among patients. These benefits will help your practice stand apart from the competition, position you as a healthcare professional with the best interests of your patients at heart, and ultimately make sure that your business is perfectly placed to take full advantage of the more open and competitive market that is likely to emerge over the next two years.
The Guardian (2014) www.theguardian.com/business/2014/jul/24/another-uk-growth-forecast-dollop-egg-face-imf-international-monetary-fund [Accessed 12 July 2014]
Yougov/Cebr HEAT (2014) www.research.yougov.co.uk/services/household-economic-activity-tracker [Accessed 12 July 2014]
For more information please call: 01747 870 910, email: [email protected] or visit: www.dpas.co.uk.