Dental Collection Statistics 2022-2023 and 2021
- Up to 88% of dentists are worried about their patient’s ability to pay.
- The average dental office has 18% accounts receivable over 90 days past due.
- Dentists need to collect at least 35% of their daily earnings each day.
- Past due accounts lose seven% of their value after 90 days.
- SMS payment reminders have a 98% open rate.
- The average dentist collects $102,542.79 a year of of gross fees of $121,546.21.
- The average dental office collection rate is 91%.
- Dental offices only collect 26.6% of money owed that is one year past due.
- To make money, a private practice dental offices need 1,200 active patients.
Dental Collections Facts 2022-2023 and 2021
1. While up to 88% of dentists are concerned about their patient’s ability to pay their bill, it is not their primary concern. It’s true most worry about their practice revenue, but they have other concerns, too. Demists worry about updating their equipment, updating their practice and more. Unlike many other industries, dentists overwhelmingly ask for their fee after they perform the service. While they may discuss fees upfront, patients in a lot of pain will agree to almost anything to get relief. This makes it harder to determine if a person can pay once the service is rendered.
2. Many dentists have 18% of their accounts receivable past due. It’s less for dental professionals who offer financing, and significantly more for offices that do not offer in-office financing. Dentists have to make their payment policies clear right from the start. Patients who know what to expect in the collections process are more likely to pay and not ignore the bill. People are more apt to pay bills when they understand the consequences of not paying, so they pay bills with the most detrimental consequences first. Since dentists can repossess a crown or dental bridge, they have to explain their use of collection agencies and understand what they can and can’t do to collect money.
3. Whatever a dentist bills each day, they should collect at least 35% of it to remain profitable. If the dentist offers financing, he or she should ask for a percentage upfront to help maintain this ratio. This figure also includes expected insurance company co-pays, making patients with dental insurance highly valuable. The formula for profitability depends on a dentist seeing eight to 12 patients a day.
4. When an account is 90 days past due, it loses seven% of its value every month. Eventually, the account becomes a liability. It will cost the dental office more in staff time, phone calls and mail to collect than it is worth. It’s essential dentists get their staff on board with an effective collection process that takes as little time and effort as possible. Automating the process is also very helpful. There are programs that can send out automatic payment reminders and alert staff when a phone call is necessary. Some dentists have started giving discounts to patients who pay upfront to alleviate this problem.
5. Dental offices that send SMS payment reminders enjoy a 98% open rate. A lot of people, up to 95%, have the ability to receive SMS messages. People see email messages as spam, but not SMS messages. Email has a far lower open rate. Surprisingly. an overwhelmingly high rate of people respond to SMS messages. Dental offices have to use the latest technology tp collect their payments in the most cost effective way possible. Having one person in the dental office coordinate these messages in proven effective.
6. The average dentist bills $121,546.21 a year and collects $102,542.79. Every tear, dentists collect a lower percentage of their gross fess. This means hard work and long hours do not equal more money. Dentists will start pushing procedures that earn them more money, although few will ever push unnecessary procedures. A dentist may market cosmetic procedures to new and existing clients to bring in more revenue to highlighting their advantages.
7. The average dental office collects 91% of the revenue they are owed. There are several reasons for this, including insurance company denials. Dental offices must verify coverage and understand the factors that can affect reimbursement, such as missing tooth clauses, annual maximums and non-covered services to get the most out of insurance payments, dental offices should file claims daily, not weekly. They should also check on every claim not paid within 20 days, since the average is 14 days.
8. When dental offices have accounts that are one year past due. they only collect 26.6% of the money. Of course, there are times when patients simply can’t pay because of financial hardship. These are probably the most challenging cases to collect. Unfortunately, other patients don’t pay because it is inconvenient. Dentists need to accept as many payment options as possible to make it easy for people to pay their bill. Offering payments through digital wallets and text to pay options can overcome patients objections and eliminate the check is in the mail excuse. Dentists should also consider Google Pay and Apple Pay options. Much of the hesitation can be eliminated by getting the payment immediately after services are rendered. Simply walking the patient to the front desk and telling them they will receive a receipt for their payment instead of asking for payment can eliminate patients delaying paying.
9. Based on the above statistics, the average dental office needs 1,200 active patients, since each patient will spend about $700 a year. The average practice loses about 15% of their patients every year. This is quite common, as people move, get dental insurance that requires them to see a specific dentist or they come in for emergency services and can’t afford to come back. Dentists have to keep replacing these patients through marketing and word-of-mouth referrals to maintain their income. With this number of patients, and good dental collection rates, a dental office can be profitable.