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    3 reasons dental membership plans will save your practice

    As insurance takes a bigger and bigger part of your income, it's time to look for a different solution.

    One of the most important trends to emerge in dental office management over the past few years has been Dental Membership Plans. The concept is not new, but the impact on the operation and financial performance of a practice can be tremendous.

    More and more practices are embracing Dental Membership Plans for a multitude of expected and unexpected reasons. Simplicity and a pent-up demand from uninsured patients are just two of the reasons why practices are converting to a subscription-based dentistry model. Why? The subscription-based economy is hot and it’s impacting consumers and businesses at all levels of the American economy.

    Related article: One simple way to build patient loyalty

    Consumers love the convenience, transparency and ease of budgeting that comes with the ability to “pay as they go” on a monthly (or sometimes yearly) subscription basis. And a significant number have become accustomed to doing business in such a manner, joining everything from Netflix to Peloton to Blue Apron.

    For all flavors of businesses, including dental practices, the subscription-based economy provides a meaningful route to creating an increased loyal customer base and generating high-value, recurring revenue.

    Holding money and a toothFor dental practices, this is a highly attractive incentive compared to the traditional dental model based on inconsistent patient visits, one-off procedures and reduced/limited reimbursements from insurance. The loyal patient — and the recurring revenue stream they create — holds greater value over time. Call it the “membership club-effect.”

    You see, patients paying a monthly subscription fee seek to get the most out of their monthly membership. They want value for those recurring payments, so they are more engaged, more loyal, more likely to seek treatment — both preventative and procedural. But there’s more to the story. The Dental Membership model can literally transform a practice by deriving incremental value from an often-ignored patient segment — the uninsured.

    Let’s face it. We all know dentistry is broken as a business. Insurance companies wield too much power and take too high of a per procedure fee, typically 40 to 50 percent. Low insurance reimbursement has served to diminish the financial viability of the industry. In fact, over the past 20 years, as the total dental market grew 70 percent, dental practice profits have remained flat as practices’ cost of supplies, equipment and staff have increased. That’s simply not right or fair. 

    Dental Membership Plans enable dental practices to take back control and tilt the financial playing field in favor of the very people most invested in delivering quality dental care. That’s you and your staff! To understand the transformational benefits of a Dental Membership Plan, consider these three broad categories of financial impact.

    Related article: 8 ways to make insurance less of a pain

    1. The cold, hard numbers

    It may sound counterintuitive to traditional thinking, but Dental Membership Plan members are your most profitable patients. That’s because typical Dental Membership Plan members accept the same amount of treatment as insured patients but generate 30 to 50 percent more net revenue once you factor out the cut that insurance companies take for nothing more than administration.

    Dave Monahan
    Dave Monahan, CEO of Kleer, has a passion for creating technology-enabled businesses that improve people’s lives. Monahan’s advocation ...

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