A healthy dental accounts receivable (A/R) turnover ratio is essential for a thriving practice. It indicates a good cash flow and successful dental practice management. While some A/R balance is to be expected, an excessively high ratio indicates that your practice may be in some trouble. Fortunately, there are some proven strategies that can increase your practice revenue while still maintaining solid relationships with your patients.
At Dental Practice Enhancement, we are experts in all areas of dental billing. We can provide training for your team to improve your dental accounts receivable turnover ratio. Or you could outsource your dental billing to us entirely! Whatever you choose, our services will be completely tailored to your needs.
Contact us today to learn more about how we can help you enjoy better financial health.
What is a Dental Accounts Receivable Turnover Ratio?
A dental accounts receivable turnover ratio measures your ability to collect on services rendered with credit. To calculate the A/R turnover, you must divide the total net credit sales by the average accounts receivable. You can also divide this number by 365 to calculate the average number of days it takes to receive payment for services paid with credit. If you consistently have patients taking more than 90 days to pay their bills, it’s time to implement better strategies to improve your dental accounts receivable.
1. Make Payment Easy and Convenient
Gen Z now makes up 27% of the population – a significant portion of the consumer base. Gen Z’ers, born between 1997 and 2012, grew up entirely in the digital age. Online and digital payment options are a great way to ensure timely payment from this tech-savvy generation.
2. Offer Incentives for Timely Payment
As much as your patients might appreciate you and your team, they probably don’t think about their impact on your financial stability. What will get them to pay on time? Discounts! Offer incentives for same-day payments or payments made in full.
3. Be Specific about Payment Terms
You can’t expect your patients to stick to your boundaries if you don’t make them clear from the get-go. Before treatment, let your patients know when you expect to receive payment. (30 days is considered a reasonable timeframe.) And don’t be shy about charging late fees – just make sure your patients know about them beforehand.
4. Use a Predetermined Script for Collections Calls
Calling to collect on overdue accounts can be awkward – both for you and for your patients. If you need help coming up with the right way to ask for payment, Dental Practice Enhancement can help. We can assist you in writing a script that feels natural for your team and fits the relationships that you have with your patients.
5. Outsource Your Billing to the Experts
Finally, if your dental accounts receivable really needs some work, consider using virtual assistance. We can take care of all aspects of billing, including collecting both from your patients and from insurance companies.
Contact Dental Practice Enhancement Today
Ready to improve your A/R turnover ratio? Contact us to learn how we can make it happen! Send us a message online or call (833) DPE – FOR – U.
