By ADMC member Jordon Comstock
Dental Membership programs are growing like crazy! Dental Economics magazine just released an issue dedicated to the rise of in-house dental membership programs and subscription dentistry, But what are they and how do they help your dental practice?
Membership programs are plans with dental benefits that your dental office sets up and offers to your uninsured patients in exchange for a monthly or yearly fee. You control the benefits you offer, how much you charge the patient and cut out 3rd party insurance companies. Much like Amazon Prime, a patient will become a “subscriber” to your practice and pay a monthly or yearly fee to get access to your benefits. Here are a few reasons why you should consider a membership program for your dental practice:
Reduce dependence on dental insurance
I have been in the dental industry for 15 years and one of the biggest complaints I hear in our industry is how bad it is to work with dental insurance. I strongly agree and have see the financial effects dental insurance has done to this industry. Image a system where you do not have to submit claims, deal with denials and delayed claims, which creates the miserable problem of delayed cash flow, Imagine eliminating the insurance mindset for both patient and staff. An in-house dental membership program can do this for your practice. if you focus on growing and signing up members you can reduce dependence on dental insurance and break free. This takes a lot of focus and work but it is worthy of your time.
Increase Patient loyalty
Loyalty is one of the most important aspects of having a strong and successful business. Loyalty is what makes growth possible. It is pointless to run a practice where your patients come in, get one cleaning and never come back. You need lifetime patients and you need predictable revenue to run your practice efficiently. A membership program can be a great way to increase loyalty to your dental practice if you choose to market it to external and existing uninsured patients.
Activate over 55% of the uninsured market
According to the US Surgeon general in 2012, over 108 million Americans didn’t have dental insurance and the number has continued to increase. It is estimated that over 55% of American don’t have dental insurance. This is a large amount of potential patients to attract and acquire for your dental practice. By using external marketing strategies like direct mail, online ads and word of mouth you can potentially grow your program to hundreds or even thousands of members who pay a yearly or monthly membership fee to your practice.
Generate predictable recurring revenue
One of the greatest benefits of creating an in-house membership program is the ability to generate predictable recurring revenue. This type of revenue stream is the holy grail for all types of businesses, especially for dental practices. One of the biggest problems in dentistry is managing the “feast and famine” cash flow cycles. One month your practice might produce a considerable amount of revenue and the next month may be a different story. Imagine if you signed up over 1,000 patients at $30/mo your practice will generate 30,000/mo of predictable recurring revenue ( this can be done as I have multiple clients that have achieved or surpassed this number of members). Could this number help you predictably cover pay roll or other expenses you may have while running your practice? The other benefit of utilizing a membership program is that you should use the discounts from the plans as an incentive to increase case acceptance. Discounts can be a very positive strategy to help increase case acceptance, only if you know your numbers/ profit margins.
Conclusion
I hope I have peaked your interest in starting and growing an in-house membership program. If you have additional questions I would love to help you answer them and continue educating you about the wonderful strategy that can help you grow your practice. If you would like to learn more details about how you can star a successful membership program, you can download my free ebook titled: “How to create and grow an in-house membership program for dental practices”
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This article is by ADMC member Jordon Comstock, founder and CEO of BoomCloud Dental Membership Software.
He started managing the marketing and sales for his family’s dental lab and has been in the dental industry for 15 years. Jordon is also the co-host of the Navigating Dental insurance Podcast – saynotoppos.com