Cost-benefit analysis ahead of 2016
Louisa Buckingham of Patient Plan Direct explains why practices should consider performing cost-benefit analysis ahead of 2016.
The dental industry continues to become an ever more competitive industry with a generation of tech savvy and business-minded dentists. More than ever, dental practices are looking to differentiate themselves, create competitive edge, provide a unique patient experience and embrace digital dentistry all whilst endeavouring to generate healthy profits and deliver the best in patient care.
A cost-benefit analysis is the exercise of evaluating a planned or existing action by determining what net value it will have for your practice. A cost-benefit analysis finds, quantifies, and adds all the positive factors; the benefits. Then it identifies, quantifies, and subtracts all the negatives; the costs. Should the benefits derived from the action outweigh the costs of implementing that action, then the action should be taken and vice versa.
As practices increasingly seek to cut costs and improve productivity and care, cost-benefit analysis has become a valuable tool for evaluating a wide range of business decisions and opportunities for dental practices; the prospect of a move away from the NHS, which consumables supplier to work with, which plan provider to work with in administering and developing the practice’s private dental plans.
When undertaking this review you should ask yourself questions such as; what value does this opportunity/action represent? What other alternatives do I have and how do they compare? When did I last review this area of my business?
Take for example, dental plan administration. It’s alarming how many dental practices aren’t aware of the fees they pay to their plan provider and nor do many assess what value these fees represent.
Many plan providers profess to offer a range of additional ‘non-plan’ related services, hospitality and support alongside core plan administration. This ‘optional’ access to additional elements of service aside from plan development is rolled in to the fee structures charged by some plan providers. Many practices don’t actually utilise these additional elements, effectively paying for something they don’t fully leverage and therefore not seeing value.
When performing a cost-benefit analysis in relation to working with a plan provider you should make a list of what the provider delivers; the benefits. For example; How many times a year do you see your representative? Do you fully utilise additional services such as regulatory advice, ‘key client’ forums, or clinical events? This should then be compared to the costs of the service and also weighed up against other provider propositions in the market.
If you already work with a dental plan provider, the Patient Plan Direct business development team can help your practice conduct a cost-benefit analysis, a very useful technique you may then consider to assess and analyse other areas of your business.
Patient Plan Direct is a dental payment plan provider working with practices across the UK, recognised for its cost effective (£1 per patient per month) approach to support and administration, as well as its innovative web-based management platform. Patient Plan Direct support practice with; New payment plan launches, NHS to Private conversions and Plan provider transfers
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