The Secret to Fee Increase Acceptance

Right now most practices are taking a look at modifying their fees for 2012. Here are some  thoughts about circumstances that should cause you to think twice about raising fees at all, then about some factors to consider that might affect the amount of the increase, and finally the number one factor to consider in the fee increase equation.

Clearly, one needs to take a serious look at the state of the local and regional economy. If factories and businesses are continuing to suffer or fail in your area and/or your practice is shrinking, any kind of the fee increase would most likely be noticed, and considered by your patient base to be unfair.  If you have recently purchased a practice it might be a good idea to wait until the dust settles before instituting any change in fee structure, regardless of the fact that a new year is about to begin. Finally, if you have recently set up practice from scratch, let’s say within the past six months, you might want to wait until you have some perception that the practice has stabilized before instituting any further fee changes.

Although I have not personally subscribed to annual fee surveys as a basis for resetting fees each year, I do believe that surveying some of your closest competitors in stealth telephone mode for most commonly billed procedures, is a pretty good idea. Submitting your fee schedule to somebody for analysis and adjustment taking into account regional fees may also provide some value. Some suggest that you can somewhat arbitrarily increase your fees on a more frequent basis than annually, and continue the process until you see some evidence of patient push-back or attrition that precludes any further increases for a while. With the overall state of the economy in this country as it is, this “what the market can bear” approach could be very risky in my opinion.

Regardless of the state of the economy, the most significant factors to consider in the fee equation are “soft” ones not so subject to rigorous number crunching as some of those previously mentioned. For example, a general practice that provides a broad range of services, some of which are not provided by competitors in the immediate area, and that is well established over many years, is in a much better position to adjust fees upward than a practice that has been around for a couple of years with a limited procedure offering.

By far the most important factor that will ensure acceptance of most any planned fee increase is the overall level of trust that you as a leader and your team have created in your patient base.  A perceived very high “quality of caring” that pervades every aspect of your practice is the best assurance that any change to your practice, including a fee adjustment, will be interpreted by your patient base as part of a well intended effort to continue to maintain and improve the quality of care and quality of caring that has been provided in the past.

A great read on the subject of customer caring, especially in regard to the impact of one-to-one engagement in social media, is Gary Vaynerchuk’s new book “The Thank You Economy.” In his book he quotes the Customer Service Impact 2010 Report as saying that “85 percent of US consumers say they would pay 5 percent to 25 percent more to ensure a superior customer experience.” If your patients are receiving truly great customer service, they will be willing to pay for it – including fee increases!

What are your thoughts on adjusting your fee schedule? Please comment below and share your experience.

Dr. Patrick Cassidy

Dr. Patrick Cassidy is a dental graduate of the University of British Columbia, and holds a Masters of Public Health from the University of North Carolina. He is the founder of Research Triangle Dental and Implant Center in North Carolina where he contributes his 30+ years of dental knowledge. Dr. Cassidy’s innovation and creativity co-founded Net32, Inc., a dental industry leading comparison shopping.

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Dr. Patrick Cassidy is a dental graduate of the University of British Columbia, and holds a Masters of Public Health from the University of North Carolina. He is the founder of Research Triangle Dental and Implant Center in North Carolina where he contributes his 30+ years of dental knowledge. Dr. Cassidy’s innovation and creativity co-founded Net32, Inc., a dental industry leading comparison shopping.

Last modified: March 7, 2019

3 Responses to " The Secret to Fee Increase Acceptance "

  1. Interesting article. Unfortunately, Delta Dental in Washington State, now in Idaho and soon in Oregon & California is directing dentistry similar to what Medicare has done to medicine. In Washington, Delta Dental has frozen our fees since 2009 and recently reduced our compensation by 20%!
    Yes, we do have the option of dropping Delta, but that does not help us when other major insurance companies see that they too can lower their compensation. The big players have the strength to endure this economy and are taking advantage of the situation by using “tough times” as their reason for reduced compensation. In submitting to insurance carriers, we ALWAYS submit our base fee and then adjust off the 15-20% after payment is made. Personally, I would be delighted if I was compensated my for my fees of 2009, let alone raise them!

  2. Don Kinosian DDS says:

    Very correct statement…..Here in California Delta Dental has forced all new dentists to sign up for the PPO Plan if they wish to become a premier provider…it appears premier will be a thing of the past and the only patients a premier dentist will see are private pay which may be the only way to survive if the fee schedule they are proposing for the large groups stay so low.
    What else can we do?

    • Pat Cassidy says:

      Your post and Michael’s have me wondering about the percentage of your practices that are subject to fee control by insurance companies? I participate in Delta Premier, but no other plans beyond that, including Delta’s PPO. With what you are saying I will certainly be running the year end numbers to see what kind of hit I can expect to take when Delta turns its attention to North Carolina.
      The thing that really bugs me about all this is the way we are setting ourselves up to eventually be under full control of the whims of the large insurance companies. What can we do to stop that from happening? When I practiced in British Columbia every year the College of Dental Surgeons negotiated with the large insurance carriers, the result of which was the College setting a fee guide to which dental insurance companies were essentially obligated to follow – consequently no PPO’s in BC. Why hasn’t that type of professional epresentation come into play in the US? Are we just wasting our money on Dental Society fees or what?

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