How to strategically meet your cash flow goals for Q2

By Lynne Leggett, DrBicuspid.com contributing writer

April 21, 2021 -- If you did not meet your goals for the first quarter of 2021, don't beat yourself up too much. Instead, let's review some items so you can correct the situation and look forward to the second quarter of 2021. The area I want to make sure practices are strategically addressing each month is cash flow, because this may be the most immediate need.

For various reasons, some reports do not get the attention they should on a weekly or at least monthly basis. I want to make sure you focus on certain reports so you can continue into May with a strategy.

Lynne Leggett
Lynne Leggett.

One of those reports that can fall by the wayside is your outstanding insurance report. This report shows which claims you are waiting on for payment. I have seen clients take the easy way out and resend outstanding claims instead of researching and finding out what is keeping each claim from getting paid. Needless to say, this is not the way to manage this report.

Most claims get paid within 14 days if the claim is sent correctly. If you do not see anything on your electronic transaction report, there is a reason why you have not received payment within 14 days of sending the claim. Time must be set aside to follow up with these claims.

Once you have followed up on all of your outstanding insurance claims, you then need to focus your time on the patient accounts that owe you money. This report, patient aging, should be reviewed weekly or at least twice a month to make sure you are sending out statements in a timely manner.

As soon as you get into a regular flow of properly working these two reports, the job in front of you is not so large and intimidating. In addition to actively reviewing these two reports, there is something else you can do to help your cash flow in your practice.

Collecting what patients owe at the time of service -- or before, when they schedule their appointment -- is another area that can help your cash flow. Working this into your daily routine should increase your cash flow each day.

I have had some clients swear to me that their patients will not do this. I believe we need to teach them this is how business is done at your office. Plenty of businesses require payment before services are rendered, and dentistry is no different. I often give examples of going to your physician for a visit or a pharmacy to pick up medications. Payment is made at the time of service.

Since the COVID-19 pandemic, there have been some changes in terms of using a digital flow instead of paper transactions. Most offices have the ability on their website to accept payments or to send a payment link via text to a patient's cellphone. Many options are now available to help you get payments from your patients.

If you have any questions about this or how to use more digital processes in your office, please reach out to me to schedule a complimentary strategy call. You can contact me by going to my website, VictoryDentalManagement.com.

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Lynne Leggett is the founder and CEO of Victory Dental Management and the author of You Can't Coach Quit: How to Create a Winning Dental Practice for Your Success. She has more than 25 years of business experience in several industries, including dentistry, medical, pharmacy, sales, transportation, logistics, and project management. Learn more about her and her services, including some free offerings, on the Victory Dental Management website.

The comments and observations expressed herein do not necessarily reflect the opinions of DrBicuspid.com, nor should they be construed as an endorsement or admonishment of any particular idea, vendor, or organization.


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