Pearls of Wisdom

A long-term client (let’s call him Joe) hasn’t come in for a while. As part of a systematic and deliberate campaign to reactivate old patients, Joe gets a phone call, which reveals he’s stopped coming because he’s been seeing his health fund practice. Why? Well his health fund said he’d be able to make better use of his benefits and it would be more cost effective for his family. But, what they didn’t tell him was how cold and impersonal it would be, and that really, there was no saving.

Joe’s initial hesitation when he picks up the phone is evident, but he’s gently guided through all the obstacles he puts up to delay making an appointment and locks in a date for he and his family. Once in the practice, he’s greeted warmly, made to feel at ease, various benefits on offer are well presented and he receives top quality treatment.

End result? Joe is back. So, too, is his family… for good. What’s more, he’s told his story to his extended family, his work colleagues and to his friends. His good word-of-mouth about his dentist reinforces his decision to never stray again.

…when people got the idea that going to the doctor was free, they stopped valuing it as much

That one phone call – in this instance made by office manager Enza Raspanti at Kensington Dental in Sydney’s eastern suburbs – did happen exactly this way (although the patient’s name wasn’t
really Joe) and has resulted in three dental consultations and reactivated the loyalty of the patient to his dentist, Dr. Adrian Courtenay.

It is no fluke; Mrs. Raspanti’s success rate is up around 30 per cent.

“I didn’t realise, but I’m told that is a very good, a very effective percentage,” Mrs. Raspanti told mivision.

“We decided this year, to make it a priority to go back over our database,” she said. “We have a big database – we’ve been here over 50 years. The ‘old school’ way was to send a reminder in the mail every six months and patients would make their appointments in their own time.

She said while some patients still preferred that approach, “we decided to be more proactive”.

“Just because people don’t answer the recall, it doesn’t mean they don’t want to come in. Most people say they have been meaning to make an appointment and they’re glad I rang,” she said.

Mrs. Raspanti said one of the keys was flexibility.

“Eighty per cent of the battle is getting them in the books. We make it our responsibility. We send them a reminder. We make it easy for them to change their appointments. Otherwise you are just waiting for them to call.

She also ensures that patients make an appointment before they leave the practice or hang up the phone – even if that appointment is a year in advance.

“Even if they change the appointment, the point is, they are still in the book.”

Challenges for Dentistry

Just like optometry, over the past decade in particular, the landscape for dentistry has changed dramatically, with independent dentists under pressure from a number of areas.

Unlike optometry, dentists cannot fall back on Medicare and they don’t have a large ‘off-the-shelf’ retail offering to supplement income from patients.

Australian Dental Association (ADA) National President Dr. Karin Alexander says dentists do have the kids’ toothbrush market covered with some colourful and child-friendly styles, but concedes it is not quite the same as an impulse splurge of a high-end pair of designer sunnies!

She said dentists generally were feeling economic pressure, with patients being more careful about spending money. Dentists also had restrictions on advertising, and using patient testimonials.

In November 2012, Medicare closed its Chronic Disease Dental Scheme, cutting free dental services to many patients. Dr. Alexander said this had severely impacted some practices that had been built around the scheme, while others were relatively unscathed.

While a new children’s dental scheme was expected early next year, Dr. Alexander said it was good practice to be careful about being too dependent on any government scheme as “they can always pull the plug”.

Dr. Alexander said another major issue facing the profession was the “preferred provider” schemes of major health insurers, which required those taking part in the scheme to charge lesser fees, with the implication that those outside the scheme were charging too much. Health insurer conduct in their ‘de-recognition’ of dentists as being practitioners eligible for a patient to receive a rebate was another major concern. Insurers’ unilateral action in this area had significant financial impact on the dentist with no right of appeal, she said.

So, facing the same issues and more restrictions than many optometry practices, how do dentists build a successful practice?

Growing Old Together

Graham Middleton is the director of The Synstrat Group, business and financial advisers, valuers and accountants, which specialises in dental practices.

Mr. Middleton said the level of loyalty shown to dentists is equivalent to that shown to hairdressers, for example, and far greater than that shown to general medical practitioners: a phenomenon he attributes to bulk billing.

“There’s an old adage among most successful dentists, that patients grow old with their dentists,” Mr. Middleton said.

Dr. Alexander agrees, saying she’d taken over the practice from her mother, who was also a dentist.

“I have patients now who remember me as a seven-year-old child – their children and their children’s children have come to the practice,” Dr. Alexander said. “Over that time, we build up the trust. The personal relationship is important. Patients want to see their dentist, not go to an address for pot luck as to who will treat them.”

Dr. Alexander said it was crucial to educate patients, and to ensure it was seen as a health service, not a commodity.

“We’re not there to sell toothbrushes, we’re there to build relationships and earn a person’s trust. We get to know the family – and we become part of the family almost.”

Mr. Middleton said much of the loyalty given to dentists could be put down to the value dentists themselves placed on the service.

“Doctors don’t get anywhere near the same level of loyalty… when people got the idea that going to the doctor was free, they stopped valuing it as much.

“Marketing people tend to focus on specials, but it doesn’t work in a professional service, it degrades the value of the service… it smacks of going to the supermarket to get a free can of baked beans,” Mr. Middleton said.

He said people go to a dentist in their formative years and get the basic items. By the time patients get older, and their teeth start to break down, they are wealthier and can afford better treatment options.

By then, they have also developed a relationship and level of trust with their dentist.

Mr. Middleton said it’s a “bad mistake for any profession en masse to give away their services” and rely wholly on bulk billing and retail.

The Optom Parallels

Leading independent optometrist Jim Kokkinakis, a partner in The Eye Practice in Sydney, says he “couldn’t agree more”.

Bulk billing, he says, is “perfect for corporate groups though. They are purely about selling product that they can source very cheaply and therefore sell cheaply. The bulk billing mentality fits perfectly here.”

“It’s not about the extra 15 per cent you can make by not bulk billing, it’s about the perception of ‘it’s free’”.

Dr. Kokkinakis said a classic example of this attitude occurred in his practice pre-1988, when he was still bulk billing. A young woman with severe red eye, induced by poor contact lens compliance, was treated and referred to an ophthalmologist… but then refused to hand over her Medicare card because it was not what she thought was a normal eye test.

“What we perceive as appropriate is not necessarily what patients perceive – the Medicare card is not perceived as a monetary transaction by many patients – in fact in this case the perception was that it was somehow my responsibility to look after her, even though she was not even my contact lens patient to begin with.”

Mr. Middleton believes that reversing the bulk billing mentality in Australia will be difficult.

“It would be good (for optometry) to move to paying for consultations but it needs to be united approach. It needs to be something the whole profession adopts.”

But Dr. Kokkinakis says “quite a few optometrists have changed to billing for valuable services outside the scope of Medicare”.

“Unfortunately, not enough have taken the next step and stopped bulk billing their standard consultation.

“It was not hard to stop bulk billing. We had moved to providing high-level eye health assessments in the mid-90s. The average patient with appropriate explanation clearly understood that this was valuable and was happy to pay for the service. This was proven two to four years later when they would return for further care.

“If the patient was not happy with the fee they would either object, at which time we would not force it upon them and they would not return for further service. This is fair enough and not everyone would return. It is a cliché but you cannot be all things to all people.

“There is room for top-level service at a fair price and there is room for very basic service with bulk billing at low product prices with high volume.

“The problem many optometrists have is that they are running their business model like they have always done when there was little competition. The market place has shifted. We will need to shift to either a premium service, where we focus on eye health or move to a corporate model with focus on high volume product,” Dr. Kokkinakis said.

Optometrist Association Australia Chief Executive Officer Genevieve Quilty said practices that had moved away from bulk-billing and started charging for private procedures often reported significant benefits.

“The financial benefits are obvious but overwhelmingly practices report this model supports and enables them to build long and trusting relationships with their patients based on providing quality eye care services,” she said.

Ms. Quilty said the OAA has developed member only resources to help support practitioners consider alternative billing options, including a move away from
bulk billing.

“While recognising the different remuneration structures of the two professions, at the end of the day
patients are seeking an optometrist or dentist they trust who can provide high quality health care.

“The optometry sector is diverse – there are a number of ways optometry services are provided in Australia, as there are in other health professions -– overwhelmingly success is built on excellence in clinical care, knowing the local community you provide services in and tailoring the way you communicate to patients in your community,” she said.

More Proactive

ProVision’s Steven Johnston said he has noticed that his dentist and his vet are “more confident in booking my appointments than most optometry practices appear to be”.

“The key difference is that both of these professions generally work on shorter cycle times – for example, six or 12 months for dentists and around 12 months for vets – so they have a higher frequency of personal interaction than an optometrist with a typical two year cycle – however, the principles remain the same,” Mr. Johnston said.

“Why can’t we ‘pencil in’ an appointment for two years down the track, which gives us permission to call up four weeks out and confirm that the date and time are still appropriate?”

“The other thing that these two professions have effectively managed to do is make me feel guilty if I don’t comply with the appointment! Why should that be any different with our most treasured of senses – sight?”

Investment Parallels

There are other similarities between the health professions. For example, dentists, like optometrists, should weigh up the benefits of investing in sometimes costly equipment, in order to grow their practices.

Regular mivision columnist, Barry Lanesman from Investec’s Banking business, has played a key role in the development of specialist finance products for the ophthalmology and optometry professions. He has worked in medical finance for more than 20 years – and also happens to be a registered dentist.

He says there are common financial themes across the medical profession.

“The cost of purchasing expensive equipment may be a deterrent however the equipment should be looked as an asset rather than a liability. It gives you the ability to improve the quality of treatment you give to your patients,” Mr. Lanesman said.

“Understanding that there are options available for you to fund this purchase and choosing the appropriate financing method to suit your circumstance may enable you to maximise your financial return and leverage savings through various channels.

He said to make informed decisions, healthcare professionals should seek specialised advice from a finance professional with experience in healthcare.

“Generally… medical professionals have a lower risk profile than a standard borrower… This should be taken into account when assessing their needs, however, many banks do not agree. This is where doctors and other medical professionals can benefit by dealing with lenders that have a stronger understanding of their profession,” he said.

Atmosphere

Despite the fact that a dental practice is not a retail environment, like optometrists, dentists realise the importance of offering professional waiting and consulting rooms with a pleasant atmosphere – and a complete absence of 10-year-old magazines.

But Mr. Middleton says one of the most important aspects of a successful dental practice is good front office staff.

He said in most successful dental practices, there will be a small number of people waiting because of a fairly strict (but not inflexible) appointment system.

“People like to be recognised. They like to be spoken to on a professional level and for you to be accommodating with appointments,” he said.

This is a point made by Mrs. Raspanti – that proactive dental office manager we spoke of earlier. She believes much of the rapport between a dental practice and patient is built by the front office – after all, there’s not much opportunity for two-way conversation when a dentist has his or her hands in a patient’s mouth for much of the appointment.

She says it is crucial for front office staff to be able to be informed enough to be able to explain things to patients “in layman’s terms”.

“People are familiar with me. They feel comfortable. He (the dentist she works for) is an excellent dentist and his patients trust him, but people also say they come here because they know I’ll look after them as well.”

Dr. Alexander, National President of the Australian Dental Association, said her patients were deliberately “mollycoddled”.

“It is all part of the package. It is very important that the ‘caring’ starts from the moment the patient first has contact with the practice,” she said. The caring experience continued right the way through the consultation and through to billing and accounts, she said.

But another important aspect was education of the importance of oral health. She said if patients stopped treatment, and didn’t respond to the usual follow-ups, she would write to them, explaining the complications that could arise by not completing a course of treatment.

Not Always Greener

But while it can be interesting to look across the fence to see how green the grass is, there are cautionary tales as well.

“There is a lot we can learn from dentists and other professions for that matter… (but) what I have seen in other areas of health care has (also) given me ideas about what NOT to do,” Dr. Kokkinakis explains.

“Look at Radiology and Pathology, for instance. The impersonal nature of these subspecialties has created huge opportunities for corporates. They have basically been overwhelmed by corporate takeovers.

“For me, optometry allows me to communicate and build rapport with my patients. Ultimately, it comes down to good relationships.