Dental Unscripted | Getting into Ownership and Practice Management Insights

Welcome to Dental Unscripted.

Where Mike Dinsio and Paula Quinn break

down the practice ownership journey,

one episode at a time.

Starting up, buying,

and running a successful dental practice.

What up?

What up, guys?

Welcome back to another episode of Dental

Unscripted.

This is Michael D'Incio and Paula Quinn

potting it up again today, this afternoon.

We're excited to be on the air again.

It's been a minute since we've been doing

this.

And yeah, we've got a good episode today.

It's all about due diligence and what to

look at after you've made an offer and

it's gotten accepted.

And we've gotten a lot of clients that,

not our clients,

but a lot of people

that have expressed issues, concerns,

things that they've missed going through

the due diligence and we're practice

management client coaches.

And we hear about all this stuff after

they've closed.

And so, you know,

today it's just a really a breakdown of

like what Paul and I think are the

most important things to look at before

you actually sign on the dotted line.

And it's a scary thing to sign.

And I, you know,

i don't want to go on too much

of a rampage here but like at the

end of the day that anxiety that you

get right before closing um a lot of

people get it i'm hoping that our clients

have less of it i think there's always

going to be some of it

But I can imagine folks that don't have

a consultant buyer advocate, buyer rep,

and they're really relying on the practice

broker and maybe their CPA and accountant.

There's some anxiety going into that close

because maybe they didn't look at the

practices performance deeper.

They may have looked at the contract.

The attorney walks you through all of the

scary legal parts of this transaction.

The CPA talks about all of the numbers

and financials and the black and white of

the practice.

But did you spend enough time looking at

how the business, the practice,

the clinic operates on a daily and what's

coming at you

Post close.

And I think that is why there is

a world of buyer reps,

because you need to look deeper.

You need to see what's going on in

the office, how you can improve it,

things you need to fix,

things you should be aware of before you

get the keys and the team comes at

you with all of the things.

And look,

you might not change all of it day

one.

But you need to be aware that some

things might be broken in the house.

And so, yeah,

that's what today is all about.

I'm super excited.

Paula bought multiple practices more

recently is right out of COVID.

And, um, you know, she,

she felt that real pain of owning in

the first ninety days.

That's a scary thing.

It's a scary thing.

So anything to add to that, Paula,

why maybe a buyer rep makes sense for

folks, uh, selfish plug for us.

I know, but you know,

even if we're not your buyer rep,

why does someone need someone looking at

stuff, uh, that like,

did you feel like you were totally

prepared when you bought your practice?

I mean,

No,

I don't think you're ever totally

prepared.

I had your help.

So that definitely opened my eyes to some

of the things.

I think it just boils down to you

don't know what you don't know.

And if you can have somebody there to

help you not make an expensive mistake,

maybe even help you save money,

give you advice.

I mean,

you wouldn't probably buy a house without

a realtor.

You probably wouldn't.

Would you buy a house without an

inspection?

Yeah.

Yeah, that's even better.

You know,

you wouldn't usually typically sign a

contract without having an attorney read

it.

I mean, it depends on what it is.

Right.

So I think that's the same thing.

It's just like you said,

the brokers are great.

But at the end of the day,

their client is the seller.

And at the end of the day,

they've never worked in a dental practice

either.

They only know what they know as well.

So I think having...

someone who's done it a lot,

people on the team that have worked in

dental practices, uh,

people on the team who have bought and

sold dental practices, um,

really can just help point out, you know,

even some of the mistakes that I made,

um, you know,

you and I learned from them,

which is great.

You know, you know, you know,

what's interesting,

Paul is like when I left bank of

America, I thought I knew, uh, everything.

Um, and the learning curve,

for me on these transitions was like boom

like straight up um and it felt at

times like drinking from uh you know of

uh what did i say fire hose um

and like of course all of the knowledge

i had about all those transactions i did

with bfa obviously made me very capable

but

When I started doing stuff with you and

Stefani,

I was realizing there's a lot of stuff

I was missing.

So I'm sitting here thinking that I have

conversations with CPAs all the time,

attorneys all the time.

And honestly,

I don't even think they know why they're

negotiating some things that they

negotiate because they don't really know

how it works in the office, truly.

You know,

they're just like they come up with these

clauses or they say these things.

I don't even think they really know how

it works.

And I didn't.

You know,

I said all those same things coming right

out of B of A,

because that's what you do.

That's how you negotiate.

This is how it is.

Boilerplate contracts.

This is just how we do it.

But if you, if someone like actually said,

well, why do you do it that way?

And is this really a big deal?

You'd say it's a big deal,

but you wouldn't really know the

consequence of it.

If it's just a thousand dollar problem or

a twenty thousand dollar problem.

And they're just like dying on the hill

over certain little five hundred thousand

dollar problems.

And they're not.

big problems, actually.

So I just think that like this episode

is really, you know,

just getting a little bit more operational

and less risk and and

and uh risk things transactional things

that you might get from a cpa accounting

banker this is going to be more

operational so so all things due diligence

of course we could never cover all the

things we look at but i did write

down some of my most favorite things and

i think i think the first one's the

hardest topic so let's hit it first it's

active patients

And it's,

it's active patients because that's truly

what you're buying.

That's your goodwill.

That's the goodwill you're buying.

You know,

otherwise it's just a bunch of equipment,

you know, hard assets, computers,

operatories, cone beams,

whatever hard assets.

And there,

there is value on just hard assets,

but typically when you buy a business,

you're buying goodwill and that goodwill

is, is what's most valuable.

It's,

it's the thing why it's the thing that

you're paying for the most.

and active patients and or hygiene

patients is in my opinion kind of that

goodwill it's a count it's the only number

that i know of that actually represents

good goodwill and so paula i like i

know there's a bunch of ways that folks

come up with kind of active patients when

you're looking at active patients

You know,

how would you define active patients?

What are some good ways?

And you taught me this.

What are some good ways to really get

a decent estimate on actual active

patients?

How would you approach active patients

when you're looking at a practice?

Well, I mean,

the rule of thumb out there is obviously

the eighteen months.

And the reason being is because not

everybody's great.

going to the dentist um so there is

some room to recapture people who have

gone over that twelve month mark

Once it starts hitting over that eighteen

month,

it's more and more doubtful if they're

really truly an active patient anymore.

Do we have the right email,

the right phone number?

Did they already go somewhere else?

You know,

if we smiled and dialed and truly called

the eighteen month to twenty four month,

like how many people are we actually going

to get to come back in?

When we're talking the twelve to eighteen

month,

rule of thumb is, you know,

there's still a chance, obviously,

twelve months.

you know,

they've been in the last twelve months,

you know, one hundred percent,

I would consider them an active patient.

But rule of thumb is last eighteen months.

Eighteen months.

OK,

so so a lot of softwares kind of

have twenty four months.

Some have twelve months.

It's like,

why can't they just have an eighteen month

button?

And some of them do of all time.

Yeah, all time.

You know,

in a good practice management software,

if they're truly deactivated,

or they're a patient who is a guarantor

who's never had an appointment,

or they haven't been in an AT month,

we would be able to narrow all that

down so that you don't get the guarantor,

you don't get the patients who haven't

been in, you know,

we forgot to deactivate, whatever.

That's the best way to report.

All practice management softwares are not

created equal.

And therefore, like you said,

they may include guarantor.

They may include people who haven't even

had an ADA code attached.

Somebody may forget to deactivate.

They haven't been in an eighteen months.

It still may count them.

So there's kind of all kinds of things.

If we were really,

this would never happen in the world of

active patients.

But really,

if we were really going to get to

the nitty gritty,

anyone that's only had a D zero one

four zero wouldn't even really be counted.

You know,

it's just like a marketing company.

We count it as opportunity.

And that's why it's considered an active

patient,

because anyone who's been seen in the last

eight months is an opportunity.

Did somebody go try and get them?

No.

But if you you know,

they only came in for like an emergency

exam and they haven't been in in thirteen

months.

Yeah.

But we can't get that nitty gritty.

So we say, look,

if they've had an ADA code,

they've been in the last eight months,

there is still an opportunity to go get

these people.

I, I get a lot of the, um,

that I get that a lot as the

as a buyer's rep.

And that is, you know, emergencies versus,

you know, true hygiene.

So so like the purest of the pure

active patients are folks that come into

your hygiene department once a year or

more, hopefully.

And but it's interesting when you're

looking at dental practice to purchase is

like as you start digging into this,

the number starts getting smaller and

smaller.

So the truth is, is like like

You know,

all the things that you might hear on

this podcast, other podcasts is like,

don't buy anything that's less than a

thousand patients.

But then you start whittling it down.

It's like really only six hundred of them

on the books.

That doesn't mean it's a bad practice.

It's just.

it's just you're trying to figure out

really what the like paula said is what

that opportunity is to grab some of those

patients and bring them in now if they've

been too far out hey good luck you're

not going to get them paula said that

um you have to remember too though michael

it's better than a new patient so a

lot of our clients will go out and

throw out mailers or throw out uh click

uh what do you call it clicking uh

yeah pay-per-click or mailers

pay-per-click

And they're doing that on, you know,

patients that have never even been in

their practice and they're just throwing

money to the wind and hope it sticks.

If you think about it,

if you buy a practice where it says

there's fifteen hundred active patients,

but truly only nine hundred of them.

I mean,

just put something together for them

that's marketable and appetizing because

they have been in before.

And if they've only been in an emergency,

they probably still don't have a dentist.

So, I mean, to me,

you have better luck sometimes going after

those.

You just got to get creative.

But I wouldn't bank on it.

So the big rub, right,

is that the brokers pull a report.

I'm working on a deal right now in

Sacramento and the broker pulled a report.

The report says fifteen hundred after

further investigation.

It's closer to a thousand.

And the reality is like the broker.

Guys,

you need to understand this broker's

liability is is simply to pull reports and

post what they what they what the report

says out of the software.

The software's

Not accurate most of the time.

So you're sitting here thinking, well,

I'm going to sue the broker or screw

that guy.

He's trying to screw us over.

He's misrepresenting.

there's got to be some liability there.

There isn't, guys.

If the broker goes in, pulls a report,

says active patients X,

and posts it on the prospectus,

that's literally all the liability they've

got.

And they can cover themselves.

Hey,

that's what the practice software said.

The truth is you've got to look at,

like Paula said, exams, hygiene,

the cleanings, all the things,

and really make a determination of what

you think is the range of active patients.

the other thing that i will say is

some fun statistics is that like on

average a patient's value to a practice on

average if it's ppo i've seen a lot

of fee for service practices lately the

practice is ppo driven not so much

medicaid just you know heavy ppo you're

looking at like seven to eight hundred

dollars per patient per year

So if you take the total collections and

divide it by what you think the active

patient is,

and it's a lot higher than seven,

eight hundred dollars,

then maybe you're off or vice versa,

really low.

Okay,

so that's kind of a nice little KPI

or a little metric that you can use

is eight hundred, seven hundred,

eight hundred.

The next person is going to ask, well,

what is it for fee for service?

Dude, it could be crazy high.

We just saw one that was twenty five

hundred dollars per patient,

and I think it might be accurate.

So so just the rules kind of go

out the window with fee for service a

little bit.

But if it's PPO,

it's a little bit easier to figure that

out.

OK, so we covered kind of active patients.

You really want to dig in.

The next thing I was going to say,

though,

is kind of retention pre-appointment.

To me,

it kind of goes hand in hand with

active patients.

But pre-appointment slash hygiene

reappointment slash kind of all of the

retention metrics matter to me when I'm

buying a practice or thinking about buying

a practice.

And usually you can smoke this out by

seeing how many active patients there are,

like we just discussed,

and then looking at the schedule and

seeing how far out your schedule.

So like,

if you have a crap ton of patients,

like twenty five hundred active patients

and you get into that chart audit and

you're seeing that hygiene's only out

three weeks, we got a problem.

Why is that a problem, Paula?

Because again,

It's every practice has kind of like this

DNA with collections,

with reappointing protocols,

and the patients are trained a certain

way.

So as a buyer, well, first of all,

what's pre appointment?

What do you think about retention and all

of that kind of why is that?

If you're a buyer, is that a problem?

Is that a concern?

What should you be expecting?

You know what I mean?

Yeah.

So people get real confused with the

reappointment versus pre-appointment and

pre-appointment is basically your entire

active patient base.

So whether it's your entire active patient

base or your entire active hygiene patient

base,

depending on which reappointment you're

talking about,

it's how many of my active patient base

actually has a next appointment.

So when we're looking at hygiene,

if we've got a thousand active patients,

and fifty percent of those have a patient,

we're at a fifty percent pre-appointment

rate.

That's not good.

We see it a lot,

but it's not good.

And what does that mean?

That means that our patients are either

not rescheduling when they're leaving or

they're calling and canceling.

know they're falling off the schedule

reappointment is when they left did i get

them on the books so my reappointment rate

could be ninety percent everybody's

scheduling and then when we go take a

look at the pre-appointment they could be

falling off for whatever reason they could

be appeasing me and scheduling

They we could live in a place where

everyone vacations and people just keep

calling and canceling whatever it is.

They're not on the books.

So the problem with that for a buyer

is, you know,

you mentioned three weeks out.

It means a couple of things.

It means our patients either don't value

their hygiene appointments.

They don't think it's important to have a

six month recare or whatever.

frequency you have them on or our team

just doesn't reschedule them.

And what that means six months from now

is our schedule's empty and somebody's got

to smile and dial to fill our hygiene

schedule or even our doctor's books.

Now, doctor's books

aren't scheduled six months out.

You know,

we like them a couple of weeks out.

I've seen everything from a couple of

weeks to a few months.

Being a few months out can be a

problem because then patients are waiting

on the doctor's schedule,

but being a few months out to six

months out on hygiene is actually a good

thing.

So we won't talk about block scheduling

and how they should leave.

No, let's not get crazy.

Yeah.

it should be pretty full six months out

um yeah so that's that's kind of i

don't know if that's no that's perfect and

i and i and sometimes it's kind of

funny like guys get into the you have

to understand what kind of practice you're

buying like like i have clients that are

buying like really small practices i don't

want them to be buying these practices but

they want to deal with

It's almost like an asset purchase or they

think it's like a fixer upper.

There's a lot of those deals.

And I don't love you did one.

And I don't love those deals.

I really don't.

And it's hard work.

It's hard work.

And there's a lot of reasons for it.

That's a different episode, different day.

But if there's like five hundred patients

in the practice did, I don't know.

six hundred thousand dollars last year and

you go into a chart audit and the

restorative schedule was like four days

out three days out the hygiene appointment

the hygiene book is is not six weeks

out don't be shocked by that there's no

patience it's a small practice if there's

only five hundred patients active patients

and the height and the restorative

schedules two days out

That front office person is constantly

trying to schedule it.

They're trying to do the same day

dentistry immediately.

It's kind of a high pressure situation

until it's very painful.

It's very stressful.

So understand that's what you're buying.

It's not the seller's fault.

That's the business you put an offer in,

and that's the business you're going

after.

Don't be expecting, I don't know,

a blonde when you made an offer on

a brunette.

That's just two different things.

Bigger practice has that kind of full

schedule, or at least they should.

And pre-appointment, hygiene appointment,

reappointment, retention,

all of that matters with big practices,

small practices.

But like if you've determined that the

practice is five hundred patients.

And four hundred of four hundred of them

are on the schedule.

They're they're damn good.

That's good.

But guess what?

There's only four hundred.

That's it.

That's all you got.

It's this schedule's not that full.

So just think about that.

Right.

Like you are leaving big practices,

making good money.

You work probably for a DSO or some

busy practice.

That's probably not what you're buying if

it's only five hundred patients.

Hell, even a thousand.

You know what I mean?

If you're at a really busy practice today,

a thousand patients is nothing.

So just keep in mind that all of

that.

Um, the one big thing that like, um,

I'm going to hit real quick is cashflow.

Now,

now the CPAs and the bankers do look

at cashflow.

Um,

What's that mean, cash flow?

So it's like a profit of the business.

And, you know,

if you this shouldn't be part of this

episode, like due diligence,

you should know the cash flow.

You should know how much money the

business makes before you even make an

offer.

So that's like before you even get into

due diligence.

This episode is all about chart audit due

diligence.

But what I will say is we get

into a lot of conversations of scenarios

where you

the business throws off, I don't know,

two hundred thousand dollars,

but the seller wants to stay on or

we're going to open up days or

You're going to put a lot of money

into marketing because the business needs

to grow or you're losing a hygienist or

there's a doctor doing hygiene and that's

weird.

So we're going to fire them and we're

going to do that.

Whatever the scenario is,

a lot of scenarios of what that transition

plan looks like.

What I don't think a lot of people

do is they don't.

re-look at the numbers based on the

transaction, the transition plan.

So some CPA banker told you he was

making two hundred, but your plan,

the way you see it or the way

you're thinking it's going to,

the seller's going to stay on,

they're going to get paid, all this,

all these things happen.

You're actually netting way less than what

the CPA banker thought that you were going

to make when you looked at the deal

initially.

So you have to run kind of like

projections

Again,

things we do for our clients is like,

okay, you've got a couple of scenarios.

You could kick the seller out and make

all this money, make two hundred grand.

Good for you.

Or you could keep the seller on one

day a week.

If you gave them one day a week,

that's X amount of procedures.

You're going to pay them thirty percent of

those procedures minus the two hundred

grand.

Now you're only make one hundred and

twenty.

Is that cool?

No.

Oh, well,

then maybe we shouldn't keep the seller on

or whatever the scenario is.

Make sure that you understand what the

cash flow looks like before you even make

an offer and then what the projection of

the scenario is going to be and how

that affects the cash flow.

know this whole thing is like there's no

reason why you should be like oh after

you buy you should know exactly what this

looks like post close because you should

be doing all of this before you buy

including adjusting the cash flow so

that's my little rant on cash flow but

you know cpas bankers they they kind of

look at it in the beginning and then

nobody really discusses well what if the

seller stays on well the bank didn't

underwrite it that way you're deciding to

keep the seller up

They're thinking you're firing the seller

and they're saying yes to the loan.

But maybe if you told the lender that

you were going to keep the seller on,

maybe the bankers wouldn't be doing this

loan.

But still,

that's something that you should know.

So that's my little thing.

And that kind of lays us up into

the next one.

And that's procedures by count by dollars.

There's been a few times where we've

looked at practices and thought that it

was a bread and butter practice.

And it turns out we got into it

and they didn't really tell us they were

doing all these implants or all on Xs.

Because when you look at procedure codes,

And Paula,

you're going to be better at this

conversation than me.

But like, if you're just seeing implants,

you're thinking they're just dropping

implants,

but it could be all on X and

that's four implants, right?

So like, or whatever.

So how would you smoke something like that

out?

Because I got to be honest, guys,

next level CPAs, bankers,

even brokers that don't know dentistry,

they're looking at the procedure counts

and representing the

And they might not really know what's

going on in the office,

and it's your job to determine if you

can do the dentistry of that office.

That's the whole point of a chart audit,

by the way, is to look at charts.

So, Paula,

what would be some things that you could

do?

And I'm putting you on the spot.

I don't know if you have an answer

here.

Let's maybe just have a discussion.

But what are some things that you can

do just to determine if you can handle

this clinic procedurally?

Procedurally, again,

putting you on the spot a little bit.

Yeah, I mean,

there's going to be additional codes that

go with all-on-fours that are in addition

to just a one-off implant.

I mean,

you're probably going to have more massive

numbers of implants.

I mean,

it's just going to be the other codes

that go with it.

You're just going to look at all those.

The cluster of codes?

Yeah,

like the different codes that are going to

go with it.

Well, do dentists know that?

Like the clusters and the combos?

Or we're just telling them that that's

what they need?

Yeah, I mean, no, I think they know.

I think they know.

I mean...

They're going to know if they drop

implants,

they're going to know the three codes they

use to drop an implant.

When other stuff stops going,

starts going with it,

like hybrids and things like that,

there's going to be other additional

codes.

They're going to be like,

what is this code?

Cause it's also typically a six thousand

code.

So there's going to be like other codes.

I think you could probably also look at

some lab bills.

Like if the lab is out of control,

you know, when you when you do,

you can look at referred out, I mean,

most dentists when when an all on X

is being treatment plan and performed,

they're either going to have the lab come

in and help them out,

or they're going to send some things out.

So I think

looking at referred out,

I think looking at lab expenses and I

think looking at codes.

Okay.

You know,

if you get in there and there's five

implants all year long.

Yeah.

And even if they did a high,

you know, an all on four, who cares?

It was one, you know, or two.

If you get in and there's a ton

of implants and,

you know, yay, if you drop implants,

but then you're going to want to go

three steps further and start asking

questions to make sure that these are

single and not something crazy.

Yeah, no, I think that's on point.

I mean,

I know it's on point because like,

I just don't think guys,

if there's one thing to take away from

this episode, it's this part,

because most of the due diligence is,

that any of us could do that could

mitigate some big risk.

But this one,

this segment of procedure counts and how

to snuff out if you can handle this

practice,

this is the single most important due

diligence factor.

And I feel like going into the chart

audit, people think,

at least our clients or folks that I

talk to,

they think it's about validating what the

broker represented.

Well,

they put in the prospectus that the

collections were three hundred and twenty

thousand.

And so we need to pull our report

and make sure it's three hundred twenty

thousand guys.

The brokers have no time to manipulate

reports.

It's not what the chart audits for.

We will pull those reports.

Sure.

And we're going to do our analysis.

Sure.

But like you're missing the whole point of

a chart.

But we're pulling those reports to just

dig

two layers deeper we're not pulling those

reports to see if the broker

misrepresented exactly because there's

other information that we're looking for

like like these you know with this implant

you're gonna you're gonna look to see if

there's yes exactly a prosthetic i well i

can't even like a denture not a denture

code but a um

Like, yeah, basically.

Yeah, we're digging in deeper.

And it's not about trying to catch the

broker in an aha situation.

You know,

active patient account is one of those

things that your broker is probably wrong.

It's just they just are.

They're pulling a report and posting it.

um we get the number we've got to

kind of like i know i gotta be

honest i'll never know exactly what your

active patient count is but i'm gonna look

at it three different angles and kind of

narrow in on a bracket that's my that's

the way i i coach but like

Again,

just make sure you can handle the

practice.

That's what the chart audit's for.

You're going there,

you're looking at procedures,

you're looking at x-rays,

you're looking at the befores and afters

and trying to figure out what the

diagnosis is.

And then you're also looking for big stuff

that you can't do.

That is like,

we've coached some clients post-close that

could not handle the practice.

And they said we could.

Is that our fault?

No, that they,

they should have really dug into that and

made sure only you can tell us that

you can handle or not, which,

which kind of leads me to the big

cases, ortho work in progress.

So like guys, gals,

if you can't like big cases,

ortho work in progress,

this is always something that gets

discussed.

And, um,

You know,

I'm throwing this up just because

specifically because of ortho lately,

I had a conversation with a broker once

and the broker's like, well,

doctors come out of school.

They know how to do ortho.

They do cases in school.

I'm like, dude,

what school are you talking about?

First of all, and second of all, no,

they are not comfortable doing ortho

unless they are ortho kings and queens at

their associate job.

so like this is the the brokers think

that you guys can do well and this

line is in almost every but to think

but to think that someone could come in

and do exactly i i just looked at

a practice that was doing two hundred

thousand dollars worth of ortho and i

asked my buyer do you do ortho they're

like no but i can learn it i'm

like okay we're talking about fifteen

percent of this practice is clear liners

This is like a full blown indoctrination

of the practice.

They're diamond whatever with Invisalign.

Most people can't do that.

Right.

Otherwise, everybody would do it.

We try to get our clients to do

it and they don't want to do it.

That's the point is like, no,

you don't just pick up ortho.

You don't just pick up implants.

So implants, big cases, ortho,

you got to look at that.

You got to look at it.

Even sometimes endo.

I mean,

a lot of people aren't comfortable doing

endo, third molar extractions.

If they do do endo,

they don't love upper molars.

There's all kinds of things.

And that's why on the prospectuses and the

bank's application,

you're going to see break down the

procedures by percentage.

That is literally the box they're filling

out for you.

And you should pay attention to that and

look at it.

And if you see three percent,

four percent, five percent ortho,

now we got to look at the eighty

ninety code and we got to dig into

that.

We got to look at the chart.

We got to look at the cases in

the in the pantry on chart audit day.

And we've got to see how much money

they've collected.

Because most of these big cases,

there's a collection amount up front that

the practice holds before the procedure.

So if you close in the middle of

one of those procedures,

we've got to figure out the money.

So anyways, big procedures,

specifically ortho, implants, big stuff,

we've got to work through.

That's obvious, guys, but like...

Be very humble in this process and just

say, well, you know, I could be better.

This guy or gal seller is probably better.

How am I going to bridge that gap?

Be humble about it.

Too many buyers are like, oh,

I can do it all.

No problem.

And then that's how they get themselves

into trouble post-close.

So talk to the seller.

You know,

you'll have the opportunity to talk to the

seller.

Talk to the seller.

What do you?

What kind of cases do you do?

What kind of cases do you love?

Which ones do you pass on?

Tell me about your ortho protocols.

That's the kind of stuff that you need

to figure out as a clinician.

So procedure counts by count, by dollars,

big cases, work in progress.

We kind of covered it.

The last thing before we shut this episode

down, it's kind of a longer one,

but this is a good one.

This is a good one.

It's collection protocols.

Paula,

and this is something that I've been

really digging into more lately.

It's interesting.

Your career develops just like doctors.

Your career develops stuff I wasn't even

looking at the first five years of my

career.

Now I'm like,

what's going on with the billing and the

codes they're using and their adjustments?

And does that really matter about the

value of the business?

No.

We're never going to like ask for a

concession because they use too many

adjustments or write offs or their

software sloppy or their whatever they're

building their collections over the

counter sloppy.

It doesn't affect the value,

but it does set the tone for how

your what you're going to inherit back to

the conditioning of the patients.

We coach a lot of clients.

I'll I'll say it again, like

there's oftentimes a reconditioning of the

patients.

And the team.

And the team, thank you.

It's really the team,

which then conditions the patient.

So it started with the team being that

way,

and then they conditioned the patient.

So do the patients expect to pay the

day of service?

Are the patients expecting to be

reappointed?

like are they expecting a very crystal

clear treatment plan that's exact dollars

like just all of that right and um

the collection protocols is something that

i've really dug into or started digging

into more um so i just find in

general um that front offices need a lot

of help so paula like

like when when we're coaching a buyer post

close what are what are very common things

that need to be fixed let's just say

the top two most common things that need

to be fixed day you want i know

that's it's like opening up literally a

can of worms but like the ones that

matter the most i suppose i don't know

um i would say the first is um

like rescheduling patients before they

leave.

Usually hygiene's a little bit better,

not always,

but usually we're conditioned when a

patient's back in our operatory to go

ahead and get them scheduled for their

next appointment.

What everybody's bad at is saying,

do you wanna reschedule?

Thank goodness we have some patients that

just say yes,

because the way we ask and the way

we do it is typically,

not going to get the best results.

Front office,

it's a little bit different story.

I would say we're not as conditioned to

get people on the treatment,

on the schedule for treatment.

We leave it a little bit up to

them.

There's money, bigger monies involved,

there's decisions involved.

And I wouldn't say more often than not,

but a lot of, but enough.

patients want to look at a schedule.

They want to think about it.

They want to talk to somebody if there's

any type of investment,

which means they're going to walk out the

door without an appointment.

And not only do we allow them to

do that,

we have a horrible follow-up system and we

leave it in the patient's hands to call

back and reschedule that fifteen hundred

dollar crown or a thousand dollar crown or

what have you.

i would say that's probably one of the

biggest things is training or help

recondition the front office to you know

number one let's get them scheduled we can

find creative ways to go ahead and get

them on the schedule and they can still

think about situations number two is if

they don't get on the schedule making sure

that we don't leave it in their hands

to give us a call back that we

control that situation so i would say

that's number one um

if we want to throw collecting money it

is probably number two it's we either

don't know the exact amount um you know

we there's things we're doing to not get

an accurate treatment plan so we're either

sending a pre-d or which i don't like

and i can that's a whole another episode

or we're guesstimating.

We think we're doing as accurate as we

can.

We're chicken scratching,

trying to figure out how much because

we're not using our software

appropriately.

So that's kind of number two is,

They don't even know how to use their

software appropriately.

So then their treatment plan isn't

accurate.

So they're either afraid to collect

because they're not a hundred percent

sure.

And they're going to wait on that EOB

to come back so they can then collect

or they're just weren't ever

made to collect so they invoice the

patient.

So whatever that collection system is,

it's broke in some way, shape or form.

And that's what I've been seeing a lot

of lately is like looking at accounts

receivables and seeing claims versus

patient portion and then seeing credits

and then trying to draw and then looking

at

adjustment percentages so it's a hot mess

so like when i'm looking at all of

that you're trying because you can't

interview the front office person that's

the hardest part of being a buyer's agent

or rep or whatever is like figuring out

how nancy joe at the front does this

without talking to her and and it's just

all based on like

random reports but you can see what's

going on at a high level but you

don't necessarily know what the problem

specifically is and so like i think that's

important for buyers to see uh going into

a purchase is okay they're good at

collecting insurance payments or they're

or they're not or they're good at

collecting over the counter or they're not

or

Um, they are not good at either or,

or their adjustments are so big because

they're not using the software, right.

Or maybe they're not doing insurance.

Sometimes it's so clean because what

they'll do is instead of cover up their

trucks, that's right.

It off.

Um, yeah, when it's too clean,

that's exactly what I think is someone's

club covering up their tracks and it's

like, okay,

they're trying to show that the reports

are like, perfect.

There's no way.

Yeah,

I've always equated it to I've probably

heard me say this, Michael,

and maybe even the audience is like,

it's like when you get your car with

a lot of technology,

or even your cell phone,

it's

You know how to in my cell phone.

I know how to text.

I know how to get on social media

and I know how to schedule an appointment.

That's about it.

Sometimes people will show me something.

I'm like, oh, wow, it does that.

I didn't know.

My car is the same way.

So you have to think about these front

office gals and guys do the best with

what they have,

whether they taught themselves or they

learn from somebody else.

And they're at the helm of this ginormous

ship

just doing it.

And sometimes it's a super hot mess.

And sometimes they figure some of it out.

But at the end of the day,

there's no school or there's very few,

which is something we help with on front

office and how to use your software

correctly and how to really,

when to do adjustments.

And by the way, when you do adjustments,

how do you allocate them?

You don't just stick an adjustment in

because you want those adjustments to tell

a story.

That's the biggest thing is, yeah,

you got to be careful on those ARs

and what is really the problem for sure.

That's right.

That's perfect.

Well,

this was a forty-minute jam-packed due

diligence tutorial.

If you didn't look at true active

patients, the retention, pre-appointment,

kind of that, procedures by count,

dollar-wise,

by count, making sure you can handle that.

ARs.

ARs, collection protocols.

Patients versus interns.

Work in progress, big cases,

things like ortho.

If you haven't looked at any of that,

if some of those things you haven't,

go back to the office and look.

The brokers are going to really love you

doing a second chart audit.

But these are all things that are very

important and things that we help our

clients with.

So

Thank you all for always listening in.

We appreciate it.

Please like, subscribe, all the things,

giving us a little star, a five star,

not one star on Spotify.

Whatever you're listening to,

it really does help the program.

So without further ado,

let's close this thing down and make it

a great day.

All right.

Peace out.

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