Welcome to the Recession pt. 1

The new challenge to dentistry after September 11, 2001 (part 1 of 2)

by Tyson Steele

Disruptions and lost business from the tragic events of September 11 are pushing the ailing economy further into recession. In mid-October, jobless claims reached 491,000 -- the highest level since 1991. In addition, more than 200,000 layoffs have been announced since September 11, and these numbers will greatly increase jobless claims in the next several months.

As unemployment soars, industrial production continues to decline nationwide with September marking the 12th straight month of declining productivity in the U.S. -- the longest string of declines since 1945, when the country was reverting back to a peacetime economy after World War II.

Much of the economic fallout from these trends failed to hit dentistry until after September 11, when consumer confidence plummeted dramatically. In the last six weeks, however, many dental practices have begun to experience increased last minute cancellations and no shows; more patients deferring treatment; slowing hygiene schedules; decreased production; reduced new patient flow and more. As the effects worsen, many people are beginning to realize that dentistry could be facing a devastating economic downturn unseen since the recession of 1979 to 1983.

In August, my colleague Mike Farley predicted that the ailing economy would eventually affect dentistry. His analysis of practices that successfully weathered the dental recession of the early 1980's suggests that only the best practices will exit the coming recession unscathed. (See www.tysonsteele.com, articles, "Surviving the Current Economy.")

In this article, I would like to discuss the key strategies and tactics that will enable you and your team to weather the coming storm of economic adversity.

STRATEGY 1 -- COMMUNICATE WITH YOUR TEAM

First, schedule a staff meeting to discuss the economy with your team. Be honest with them regarding the potential consequences of economic fallout. The worsening economy could be a great challenge for many practices, and you and your team need to have a solid understanding of the potential effects on your practice.

Discuss some of the statistics mentioned at the beginning of this article. Then discuss evidence of this as seen in your own practice. Have some patients been laid-off? Have you seen a decrease in hygiene appointments? Have some patients deferred needed treatment? You see, statistics are interesting, but no one believes statistics until they are impacted personally. You need to understand the general economic trends and then confirm them viscerally from your own experience.

Of course, some practices have yet to be noticeably affected. If you are one of those practices, staff members may have difficulty believing that your practice will eventually be affected, despite all the evidence to the contrary. Keep in mind, however, that many "unaffected" practices had excess demand several months ago -- they were booked way out. Thus, even with a reduced patient demand, these practices still have a full schedule. Depending on the overall decrease in patient demand for treatment, those practices (and yours) are still in danger of being affected.

You and your team must also realize that much of the potential fallout has yet to be determined. This is because patients have already scheduled their hygiene recall appointments for early next year. However, you won't know for certain if those patients will keep their appointment until the time comes.

Finally, you should discuss how any decreased production might affect your practice and your team. Be honest with each other. For many practices, staff layoffs or reduced work hours are a definite possibility. For most practices, the doctor faces a dramatic decrease in personal income, which, combined with an ailing stock market, could easily affect both discretionary spending and retirement timelines. (In fact, we have heard several reports of dentists pulling their practices off the market and delaying their retirement in the last month.) As a team, you need to know that these consequences are possible and work together to counter the effects of the current recession. As with most adversities in life, hard work is the key to success.

STRATEGY 2 -- FOCUS ON HYGIENE

The hygiene schedule is the lifeblood of the practice. Patients who are consistently in hygiene are more likely to receive restorative treatment and refer other patients. Because of this, the health of the hygiene department becomes even more important during a recession.

Unfortunately, when money is tight, patients tend to view their dental hygiene appointment as OPTIONAL. "After all," they think, "it won't hurt to wait another six months." And, for the most part, they are correct -- gasp! -- they can survive without dental hygiene.

The problem is that one missed appointment leads to another as patients are out of communication with you and your team. Ultimately, patients who drop out of the hygiene program are difficult to re-activate. They simply disappear.

Of course, this can be devastating to the patient's oral health as their periodontal care deteriorates and decay is left unchecked. However, the patient often experiences little discomfort, so they assume everything is okay.

Do not let your patients disappear. You must do everything in your power to keep them in the hygiene program. Otherwise, you will have to try to reactivate them later (very difficult) or try to attract new patients to take their place (even more difficult.)

Improve Patient Hygiene Education

Begin by taking the time to educate every patient you see regarding the importance of maintaining his or her next hygiene appointment. Let patients know that consistent professional hygiene care is very important to their health. In addition, explain that regular care and exams can help you save them money in the long run by enabling you to detect problems early and prevent decay and gum disease. This discussion should be the responsibility of the hygienist or the doctor for every patient seen each day. (Of course, this type of patient education should be ongoing in your practice. However, now is the time to step it up a notch.)

You can also use the patient's future need for restorative treatment to reinforce the importance of hygiene maintenance. Say something like, "Mrs. Smith, I'm concerned about the old filling you have on this tooth. Eventually, we're going to need to replace it with a better restoration. It will probably hold up for a little while, as long as you maintain it well at home. But you've got to promise me you will be here in six months to see Sally for your hygiene appointment to help maintain it. Is that okay?" Ultimately, this builds the foundation for future restorative work while promoting hygiene.

Have Providers Make Reactivation Calls

Call patients who cancel their scheduled hygiene appointments. Granted, it is hard to reactivate patients who drop off the schedule. However, it can be done, and although your closure rate may not be great, every patient retained is another patient you don't have to replace. These follow up calls can have greater impact if made by the doctor or hygienist than a front office person. (Remember that "hard work" I talked about!) Of course, many practitioners are nervous about making this type of call. But, don't worry -- a couple calls will warm you up. Besides, compare your discomfort with reactivation calls to the discomfort you would feel if you had to live on pork and beans.

You should always have a "reason" to call. If you need to leave a message, just say something like, "Mr. Smith, this is Dr. Williams, I noticed that you canceled your hygiene appointment for next week and didn't reschedule. I just want you to know that I'm still concerned about (your periodontal condition, that front tooth, maintaining your bridge, or whatever) and I really want to help maintain your health. If you have any concerns that haven't been addressed, please call my office and I will schedule a phone call with you. I would really appreciate an opportunity to get your feedback. Thanks for your time. My number is ..."

Be certain that you provide your front office with a list of patients you have called and your reason for calling. That way, they will be up-to-speed if the patient calls.

Defer Restorative Treatment If Necessary

You must also be willing to delay restorative treatment if necessary. Remember, hygiene is the key to the long-term health of the practice. So, you should do almost whatever it takes to keep a patient involved. This may mean putting off restorative treatment until a patient feels they have the money, as long as the patient agrees to remain in the hygiene program to prevent a larger problem from developing.

If the patient is in hygiene, you will get the restorative. If the patient drops out, you will be lucky to get anything.

(to be continued)

Watch for Part 2 of Welcome to the Recession, including the final two of four defensive strategies, in our next issue.