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Your patients are consumers. Consumers look for ways to extract value from the world. You are a business owner. Your job is to provide value to the world.
Unfortunately, too few doctors see things that way. They worry that insurance companies are scamming them, that their customers won’t want to pay for service, or that their employees aren’t working hard enough.
These dentists are thinking like consumers, trying to extract as much value as possible from the world around them. If you want to create a successful business, you have to ask yourself how you can provide more value to your patients.
Best Price and Best Value Are Not the Same Thing
In my previous post, Treatment Presentation: Like Dogs, Your Patients Can Smell Fear, I wrote about two doctors who were charging wildly different prices ($1,650 vs. $975) for the exact same crown.
A couple of weeks ago I found myself in an office with a dentist who is charging $2,100 for that crown. And yet patients are lining up at his practice. Why do you think that is?
This doctor is able to confidently explain the value of coming to him for this service over other dentists. His confidence affects his patients, and they want to pay for the service even though it costs more money. If you believe that your work is valuable, your patients will too.
Go That Extra Mile
Entrepreneurial consultant Eben Pagan’s entire business philosophy is built on the idea of providing ten times the value that his clients are asking for.
Yes, Pagan is dealing in information and ideas, which come with relatively little overhead, but it is possible to translate this concept of added value into the brick-and-mortar world of dentistry where there’s a real minimum cost of doing business.
Adding Value Doesn’t Mean Giving Things Away For Free
I was in an office yesterday that’s gotten into the habit of providing free tooth sensitivity treatment. This is a treatment that typically costs $72-$95 per patient.
If you look at their actual expense, it doesn’t seem like such a bad idea. The material cost is only $1.40 per treatment. But if you look at total overhead, the true “direct operating cost” expense is closer to $38.
How long do you think they’ll be able to keep doing that if they want to stay in business?
Look For Added Value Where It Already Exists
All the dentists reading this will remember silver, or amalgam, fillings. They’ll also remember everything negative that was written about amalgams and how composite, tooth-colored fillings eventually replaced them.
The technology has continued to advance. Now we can offer patients fluoride-filled Giomer composites, which keep teeth healthier.
The average composite filling material costs a practice about $22 per gram for the material and the patient about $200 per tooth. This might seem like a huge margin but when you consider the cost of doing business, you begin to realize it’s not.
The price per gram of Giomer isn’t far off from the standard composite material so if you want to look like a hero, you could offer it to your patient at the same cost.
Or you can turn to your patient and say, “Here’s this new technology. It’s a better product with more value, so there’s an upgrade fee of $25 per tooth.”
If you really believe that you’re doing your patient a value-added service by letting them know about this superior technology, they’re going to turn right back to you and say, “Sign me up!”
In my next post, Dr. Thorup & I will continue the added-value conversation from the patient’s perspective. For now, leave a comment below with some ideas for where value might already be hiding in your practice.
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