Australasian Dentist Magazine Sept-Oct 2021

Australasian Dentist 121 Finance A t the time of writing this article (late August 2021), Covid was far from over and the pathway out of it, in Australia, was unclear. However, there must at some stage be a return to normality and your practice needs to plan for this and also plan for the cost of the covid era. Demand and supply In simple terms the underlying need for dental services remains consistent, whether there is Covid or not. However, the “supply” of dental services has been reduced because of the unused professional hours lost due to lockdowns and patient concerns. Every practitioner has a finite number of professional hours during his working life and hours which are lost cannot be made up for. It is similar to a hotel with large vacancies during Covid. Those room- night charges are lost forever. In financial terms, this means that your practice has suffered a loss of earnings during the Covid period and will probably continue to do so and as the supply of dental services across the economy has not kept pace with pent-up demand, there will be a backlog of patient demand. In summary, there will be increased demand for dental services, when we hit some sort of normality. In addition, the economy is going through a period of marked shortages of labor and this is beginning to impact wage levels and inflation is rising. There is no reason why dental practices will not be hit by this, so plan for an increase in wage costs in your practice. The outcome of this thinking is that you need to seriously review your prices and factor in both increases in running costs and also increases in prices for dental services across the board. The time to plan and implement this is now, not when our economy is back to normal. Best practice One area where you can plan to improve your back-end processes is in your billing and collections functions. Use some of the free time you have to The post-covid dental practice By Roger Mendelson plan and implement this. It is not difficult and there is no cost involved in adopting best practice. You adopt best practice in your professional work, so there is no reason why you should not do it in your practice operation. With the need for your practice to make up for lost earnings, you cannot afford to provide services you do not get paid for. There is no reason why a dental practice should have any bad debts. However, the reality is that most do. What to do The most basic building block of best practice is for your practice to adopt a New Patient Form (“Form”). Rather than reinvent the wheel, learn from the experience we have gained in acting for many thousands of dental practices over our 45 year history. Go to our website www.prushka.com . au, click on the Products and Solutions tab and scroll down to “Free Credit Application Forms” or enter this link – http://www.prushka.com.au/forms/req_ forms_CreditApplication.cfm. Download the free Form and adapt it for your practice. It is in Word, so this is a simple process. Whenever you take on a new patient or if you are dealing with a patient who has given you some concerns in the past, insist that they complete the Form. Armed with the information contained in the Form, you will have enough information to decide whether or not to grant credit in the first place and if there is a default in payment, you have all the information a debt collection agency would require to find the patient and to collect the debt. Get your patients to pay debt collection costs The Form contains some simple trading terms and an important one provides that in the event of the patient being in default, he becomes liable for all debt collection costs incurred by your practice. Thus, in that case you can outsource the debt to a debt collection agency at an early stage and request that they add their collection Roger Mendelson The writer is the Executive Chair of Prushka Fast Debt Recovery Pty Ltd and is principal of Mendelsons National Debt Collection Lawyers Pty Ltd. Prushka acts for in excess of 58,000 small to medium size businesses across Australia and operates on the basis of NO RECOVERY – NO CHARGE. commission and costs to the amount outstanding. Avoid family disputes The Form clearly stipulates who the patient is liable to pay bills for. This will avoid many problems which occur down the track when there are family breakups. Is it worth suing? It is rare for dental practices to sue for debts below about $5,000.00. However, if the debt is not disputed, the patient has a regular job and the address has been confirmed, there is no commercial reason why you could not sue for debts as low as about $800.00. The reason for this is that in such cases, most judgments would be granted “by default”, which means that there is no court hearing and no need to give evidence. Judgment would be obtained quickly and it would contain a cost order and an order for ongoing interest (at approximately 10% per annum, depending on the state). In some states, particularly New South Wales, enforcing a judgment through the garnishee process is quick, easy and cheap. This would then result in an order on the patient’s employer compelling it to deduct a specified amount from the regular pay period of the patient. This is but one side benefit of having the patient complete the Form in the first place. All the information about employment will be available from the Form. u Contact: www.prushka.com.au Free call 1800 641 617. The writer is also the author of: The ten mistakes businesses make and how to avoid them and Business survival. Both published by New Holland Publishers.