By Tom Limoli
Stop, look around. Are we alone? Is anyone looking? Now, close the door and dim the lights. We have to talk, just you and me, and it’s about your fees.
Limoli & Associates has tracked dental fees for the better part of the last quarter century. My father collected both international and domestic fees and fee schedules the same way some people accumulate postage stamps and coins. His detailed analysis of data was nothing less than a labor of love for his profession and how it functioned within the confines of differing world economies.
The tracking and reporting of dental fees is no different today. The sluggish economy complicated by rising unemployment and government intervention in the free market system is challenging capitalism as we know it. And guess what? All this shows up in the fees charged by doctors to their patients.
Not so long ago it was common for dentists to raise their fees annually by 2% to 5%. These fee raises were usually “across the board” where each and every procedure code was modified. But, those days have also gone by the wayside. The act of balancing fees is an art form pioneered by my father in his original 1984 textbook entitled The Dental Consultant Looks at Insurance with your Fee Schedule. He and I perfected the process of fee balancing and relative value with our original 1995 text Fee for Service Dentistry with a Managed Care Component. In short, Limoli & Associates is the most accurate source for a comprehensive fee schedule analysis.
What does your current fee data show?
In many parts of the country dental fees are stagnant. We are not seeing dental fees statistically drop but we are seeing areas where the data has reached a plateau and is no longer in a growth posture. I see this also occurring as fewer and fewer dentists are routinely jacking up their individual fees simply because the calendar says so.
In those few areas of the country where the fee data are consistently rising I see this as the effect of simple procedural reality. Artificially deflated fees simply and naturally rise as greater numbers of various procedures continually occur in that geographic area.
Three things must continue to painfully happen in order to maintain growth and establish economic stability.
- Banking and lending markets have to stabilize on their own without government intervention or other institutional manipulations.
- Service industries, including healthcare, have to fundamentally restructure how they do business in order to maintain a more competitive and cost effective posture in delivering their services.
- Corporate models must continue to trim the cost of goods sold while continuing to produce and develop newer market solutions to yesterday’s longstanding problems.
Old solutions are not going to fix the new economic problems.
What do all three phases have in common?
The answer is simply fair market pricing. Fair market pricing is the amount of money that a willing buyer pays to acquire something from a willing seller. What we are talking about is your unrestricted usual fee.
Where do your fees fit in? Where and by how much is your data higher/lower than that of your neighbor? Is it that way by design and intent or do you simply not know?
Stop basing the future of your practice and fee schedule on randomly generated statistical percentile calculations, which is not real data. Let Limoli & Associates professionally analyze your fees. Your potential and active patient base is shopping for quality, price and value. Unfortunately, not always in that order.
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