dental entrepreneur - spring 2012

dentalentrepreneur

Business Beyond the Classroom

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Things Every New Graduate Should Know!

Youve Got Your Diploma Now What?

3 Simple ways to Build Powerful Leaders on Your Team

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2 Spring 2012 Dental Entrepreneur www.dentalentrepreneur.com

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Spring 2012 VOLUME 14, ISSUE 2

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Oral-B LaboratoriesUltradent Products Inc.Proctor & GambleWm. Wrigley Jr. Corp.Glidewell LaboratoriesBenco Dental Co.Tess Corp.Dental Care Alliance

The Pride InstituteThe Snyder GroupMcKenzie ManagementCaesy Education Systems, Inc.Warner-Lambert Co.Phillips Health CareOxyfresh Worldwide

Class of 2012 Contributors

Charter Sponsors

Welcome toDental Entrepreneur

CLASS OF 2012SPRING ISSUE

Editor & PublisherAnne M. Duffy RDH

Assistant EditorMichael Duffy

Brad Beauchamp

Production/AccountingKitty Beauchamp

Director of AdvertisingLinda Hart

Editorial BoardDr. Earl DouglasDr. Gene HellerScott MahnkenAllen Schiff, CPADr. Tom Snyder

Dr. Harold B. SturnerDr. Joe Rubino

Layout and DesignJohn OConnor

Dr. Tanya BrownBruce Bryen, CPA

Edward C. Challberg, CPADerek ChampagneDr. Earl DouglasLeslie Franklin

Peter Gopal, PhDHema Gopal, MVA

Dr. John H. JamesonDr. Roger Levin

John McDonnellBrett S. Miller, CPA

Brendan Morrissey, CEOTammara Plankers

Kathleen M. RomanDr. Roy Shelbourne

Dr. Tom SnyderDr. Richard Weinman

David Woods

By now you can probably see the light at the end of the tunnel. Not that dental school is a tunnel, but you do need focus and tunnel vision to complete your courses. It is somewhat ironic that you are entering a profession where you look into a deep, dark hole, mouth after mouth. So hold on to your lighted loupes and get ready for the ride!

You may feel all sorts of emotions excitement, triumph, distinction and quite possibly a little distress in what lies ahead as you embark on your career as a dentist. You are certainly clinically prepared, and you must trust that. But we are here to help you become entrepre-neurially prepared.

Recently, I took on a project to renovate our familys Charlotte home. !e question was, where do I start? !e "rst thing I did was comb through magazines and websites to get a feel for my style. I reached out to experts referred to me by people that I admired and had a good track record. !ese experts helped me develop my game plan. After all, they do this kind of thing for a living. From those conversations and meetings my team was formed, the process begun and the realization of my dream was complete.

Now its your turn to reach out. Where do you begin? What experts do you call on? What questions do you ask? !is is where Dental Entrepreneur comes in.

For the past 14 years, Dental Entrepreneur: Business Beyond the Classroom has been one of the top resources for future dentists just like you. Weve worked with tons of experts in our diligent search for the answers to those questions, pulling together pros from "nance, insurance, technology, team-building, continuing education and, yes, even dentistry.

We hope we give you a place to start in this issue. Brett Miller answers the question, How should young doctors manage their money?

Earl Douglas explains the di%erent practice scenarios, laying the groundwork for you to make your decision on how you want to get started. Tammara Plankers of Wells Fargo Practice Finance shares how to create a compelling business plan that is unique to you.

Dr. Tom Snyder knows about building strong relationships and he gives sound advise on creating a successful partnership agreement. An agreement that will a%ect you for a lifetime!

Our insurance expert, Leslie Franklin begins with a simple quiz that will surely open your eyes, and she follows it with comprehensive information that will help you take a sigh of relief. Marketing ideas from Derek Champion and the Gopals will answer how to get butts in seats. Roy Shelburne tells one on himself and quite possibly will keep you from learning the hard way.

And last and most important to me is Tanya Browns article on Leadership. I believe you must always strive to develop leadership qualities. Leadership supports success!

Speaking of Leadership, my closing request is for all of you to take a strong look at the National Leadership Conference in Chicago this November, sponsored by ASDA. !at is one skill that will keep you on the right track as you navigate through the many tunnels and many mouths throughout your dental career.

Anne M. Duffy Publisher

All the best,

Dental Entrepreneur Spring 2012 3www.dentalentrepreneur.com

Prologue4 Money 101: What Doctors Need to Know

Before Graduating from Dental School Brett S. Miller, CPA, CFP

Getting Started8 Youve Got Your Diploma Now What?

By Earl Douglas DDS, MBA, BVAL

10 Plan To Succeed: Creating a Business Plan for Your Practice Tammara Plankers

Business Fundamentals14 Creating a Successful Partnership: What

to Include in Your Partnership Agreement Tom Snyder DMD, MBA

16 Things Every New Graduate Should Know about Record Keeping! Dr. Roy Shelburne

18 Fact or Fiction? Quiz Yourself on Personal Insurance Myths & Misconceptions Leslie Franklin

Practice Builders22 Unlock the Mystery of Effective Practice

Marketing: Choosing the Right Identity, Message and Plan Derek Champagne

28 Attract More New Patients with Low Cost Internal Marketing Peter Gopal, PhD and Hema Gopal, MVA, DMD

The Power To Succeed34 3 Simple ways to Build Powerful Leaders

on Your Team Dr. Tanya Brown


CLASS OF 2012 SPRING ISSUEVOLUME IIdental

entrepreneurs

Contents


BRETT S. MILLER, CPA, CF

Prologue

I had the privilege of attending the graduation ceremony for the Uni-versity of North Carolina School of Dentistry in May of 2009. My broth-er, Dr. Chris Miller was lining up with his classmates, who were all eager to graduate and begin their dental careers. Like many graduating doctors, Chris was ready to transition from the life of dental student living on loans to a working professional earning an income! As Chris and I spoke about his plans following graduation, one common theme emerged in our discus-sions how should young doctors manage their money? Most dental curriculums

focus almost exclu-sively on the clini-cal side of dentistry, leaving a critical gap in what new doctors truly understand about managing their own money in todays complicated and ever changing

economy. Below are a few money man-agement tips that will allow young doctors to start their dental careers on the path to "nancial success.

Always Have a Plan We "nd ourselves in di)cult economic

times. Over the past ten years, its been proven that dentistry is not recession proof and most doctors wealth has suf-fered. According to Dental Economics, only 5 percent of dentists can actually a%ord to retire at age 65 and main-tain their current standard of living. Additionally, John K. McGill, editor of the McGill Advisory and principal of the

McGill & Hill Group, says the reason that most doctors struggle "nancially is not that they plan to fail, they simply fail to plan. No doctor works through dental school and perhaps a specialty to end up ,at broke at the end of their career. However, many baby boom generation dentists "nd themselves in this position because they failed to implement a plan that would allow them to retire at the age of 65. !e biggest mistake doctors make is not working with a dental spe-

ci"c "nancial planner as soon as they start their professional career. Developing a comprehensive "nancial game plan, in writing, is one of the most important "nancial decisions that a young doctor can make. Just remember, its much easier to pursue and attain a goal if it is clearly de"ned.

Be Smart About DebtLike many dental professionals, Chris

"nanced his education with debt. Many

Money 101: What Doctors Need To Know Before Graduating From Dental School

Brett S. Miller, CPA, CF


of todays graduates use student loans to pay for dental school and others acquire even more debt to pay for their entire education. Additionally, many doctors have debts associated with a car, home, credit cards, etc. Regardless of the indi-vidual circumstances, Should I pay down debt? is one of the most common ques-tions new doctors ask. !e answer - it depends. Debt should be separated and classi"ed into separate categories based on the interest rate and tax deductibility. Consumer related debts (credit cards, department store charge cards, cars, etc.) have the highest interest rates (typically above 7 percent), and the interest is not tax-deductible. We suggest paying these debts as quickly as possible to avoid the crippling interest costs. Loans secured by a doctors house (mortgage and home equity line of credit) are tax-deductible and the interest rates are typically between 3-7 percent. We understand that many dental students dont yet own homes, but for doctors looking to purchase a home, we recommend they speak with a mortgage specialist to lock in a rate below 4 percent over a "xed time period (15 or 30 years). Education debt (student loans) typically has the lowest interest rates (below 4 percent) and should be the last debt young doctors should consider pre-paying.

Being smart about debt is a very com-plicated practice and we recommend that new doctors speak with a dental speci"c "nancial planner before taking on addi-tional debts. !is will ensure that doctors are in the appropriate debt structures and "nancing terms, along with providing a great basis for discussion regarding pre-payment of debt.

Establish a Budget and Live Within Your Means

Overspending is one of the key reasons that many doctors cant a%ord to retire. !e more a doctor spends, the more money they will need for retirement. Moreover, higher spending leaves less assets available to save. Recent studies indicate that most doctors dont know how much they are actually spending.

As a result, they fail to budget and live well above their means for a majority of their dental careers trying to keep up with the Joneses. Establishing a budget and sticking to it can alleviate this problem by allowing you to control your spend-ing and ensure proper retirement savings. Additionally, it prevents doctors from accumulating consumer debts that have

high interest rates and kill monthly cash ,ow. !e good news is that young doc-tors can choose to avoid this problem by establishing a budget to track their expenses now. Mint.com is a free per-sonal "nance website that allows users to develop a budget and monitor their cash ,ow. If young doctors get a handle on their spending now, it will lay a solid foundation for their dental careers.

Save First, Save Often!e No. 1 goal for all doctors is to be

able to a%ord to retire and its never too early for doctors to start thinking about their future. In the book Rich Dad, Poor Dad, Robert Kiyosaki introduces the concept of pay yourself "rst. Most doctors make the mistake of making money, spending money and then trying to save. !is is a poor money manage-ment technique, and the savings goal is very rarely achieved because the majority of money is already spent. We commonly refer to this as the gone factor. Instead, doctors should build savings goals into their budget and the "rst payment every pay period should be to savings. Doing so ensures doctors will save more money and prevents a savings failure.

Another important tip for new doc-tors is to begin saving as soon as pos-sible. Compound interest and the time value of money are very important factors in determining retirement success. !e longer savings are allowed to grow and earn interest, the bigger the nest egg will become at retirement. For example, assume that two doctors commit to saving $5,000 per year, at a growth rate of 8 per-cent per year, until retirement at age 70. !e "rst doctor begins to save at 30 and the other waits until 40. At 70, the doctor who began saving at 30 will have accumu-lated $1,398,905 in savings while the sec-ond doctor will only have $611,729. !at represents a di%erence of over $785,000! Why? Even though the di%erence in contribution was only $50,000, 10 years of procrastination resulted in the second doctors assets having less time to grow and compound!

Prioritize Your SavingsOnce a doctor has committed to sav-

ing for retirement, its important to save in the proper order. Generally, the rec-ommend savings order in the following order: 1) Retirement Plans, 2) Individual Retirement Accounts, 3) Education, and 4) Personal Savings and/or Pre-Payment of Debt. A doctors "rst priority should be to contribute the maximum to their com-pany sponsored retirement plan (401k, 403b, Simple IRA, SEP IRA, etc.). If that is not possible, at a minimum, doctors should contribute up to the amount that the plan matches. After fully funding the retirement plan, a doctor should consider funding a Roth IRA. Roth IRA contribu-tions are subject to an income threshold, and if a doctors adjusted gross income is higher than the contribution phase out range (Single - $110,000 to $125,000; Married - $173,000 to $183,000), doctors should fund a non-deductible IRA. For doctors with children, the next funding priority is to save for future education expenses. After fully funding these three items, doctors should consult with their advisor about investing the remaining money personally or look to pre-pay debt starting with the highest interest rates.

!e longer savings are allowed to grow and earn interest, the bigger the nest egg will become at

retirement.


Avoid High Cost Commission Based Investment and Insurance Products!e "nal money management recom-

mendation for new doctors is to protect their savings and invest in a prudent man-ner. !e investment and insurance profes-sions are very complex and have been fur-ther complicated by the extreme market volatility over the past several years. Many "nancial experts still recommend the tried and true theory of dollar cost averaging and I fully support this concept. When starting to invest, doctors should use a discount brokerage "rm such as Vanguard, Charles Schwab, Fidelity, TD Ameritrade, etc., to set-up a balanced allocation of no-load mutual funds containing both equi-ties and "xed income that is appropriate for your risk tolerance. From an insurance perspective, we recommend doctors stay away from permanent life insurance and/or annuity products. Doctors should seek to add term life insurance in an amount equal to their future earnings potential. A new doctor will need more term insur-ance to cover their higher load of debt and lack of retirement savings. As a doc-tor matures, their insurance needs should decline as they pay down debt and build retirement assets.

Good Luck!As this article goes to press, a new gen-

eration of dentists will be entering their "nal semesters. I encourage each new doctor to make smart, informed decisions to better their "nancial future. !ere are many advisors who can help along the way, but ultimately it depends on each doctors level of commitment to his or her own "nancial success. Good luck! Q

For more information, contact Brett Miller at [email protected] or toll-free 866.727.6100

Business Beyond the Classroom RESOURCE GUIDE

ADA Insurance Plans 888-463-4545 www.insurance.ada.org

For loan collateral, debt protection, and financial security, dentists rely on the ADA Insurance Plans for best-in-class life and disability insurance, including free coverage for ASDA members during den-tal school. ADA members benefit from group rates that keep pre-miums low and hard to beat. Great-West Life & Annuity Insurance Company insures the ADA Insurance Plans, and protects more than 130,000 dentists, dental students, and their families every year. Please see our ad on the back cover.

ADS Transition Specialists(888) ADS-4237 www.ADStransitions.com

ADS is the nationwide leader in dental practice sales, associateships, buy-in/buy-outs, partnerships and appraisals. ADS is comprised of the industrys most experienced professionals, including dentists, attorneys, and CPAs. We can help you with each step of your next transition. To view a complete list of practice opportunities available in your desired area, visit us at ADStransitions.com. Please see our ad on page 17.

ADS Transition Specialists South770-664-1982 www.adssouth.com

ADS South is the premier dental transition organization in the Southeast. We provide associateship placement, dental practice sales, appraisals, and expert testimony services. Our company was founded over 26 years ago by Earl M. Douglas, DDS, MBA, BVAL, and we continue to control the cutting edge of transition technology. Please see our ad on page 12.

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!e "nal money management

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prote> their savings and invest in a

prudent manner.

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GUIDING AND PROTECTING AMERICA

* * M e s s a g e a n d d a t a r a t e s m a y a p p l y. Te x t C H AT t o 7 1 2 1 2 t o i n i t i a t e a n S M S c o n v e r s a t i o n w i t h a n A i r F o r c e R e s e r v e a d v i s o r. Te x t STOP t o 7 1 2 1 2 t o o p t o u t . Te x t HELP t o 7 1 2 1 2 f o r m o r e i n f o r m a t i o n . T h i s p r o g r a m e m p l o y s o p e r a t o r s w h o a r e p a i d t o p a r t i c i p a t e i n c h a t . H o u r s o f o p e r a t i o n : M o n d a y t h r o u g h F r i d a y, 8 : 0 0 a m t o 1 1 : 0 0 p m E S T. S e e p r o g r a m t e r m s a n d c o n d i t i o n s a n d p r i v a c y p o l i c y a t h t t p : / / s m s . a f r e s e r v e . c o m .


Now that the end of your formal dental education is "nally in sight, youre probably think-ing about whats next. As you search the horizon for options, you will probably discover that your new career will consist of one of the following - an associateship, a partnership, starting a new

practice, or buying an existing practice.

Each option comes with its own risks and rewards, and each option will contain the best and worst of opportu-nities. Your job is to discover which option is best for

you and discover the best opportunity that is available therein.

First, lets look at associateships. !is option requires the least commitment. It doesnt cost anything to get into one, and if one is careful, they can usually be terminated in 90 days or less. !e best associateships with fee for service patients will generally involve a covenant not to compete and non-solicitation agreements as owners of such practices are not willing to allow an associate to leave with their patients. In managed care or Medicaid practices, owners are not as concerned about losing patients, as there is usually a very large supply. You should not expect to enter into restrictive agreements in those type practices.

Dont be surprised if associates are not given the best patients and the most rewarding treatment plans to work with. !ese will naturally be reserved for the owner. Also, if things slow down, the asso-ciates schedule will be the "rst one to be cut, as they are hired to work on a practices

over,ow. If the over,ow disappears, so will the associateship.

Hopefully, you will "nd an associateship where you wish to practice that has an abundance of fee for service patients who have the need, demand, and ability to pay for top drawer services. In such a setting you can sharpen your skills, be productive and pro"table.!e next option is the partnership. I

am more cautious about partnerships than any other option, having observed the experiences of dentists who have been hurt in these situations. Partnerships are like marriages in many ways. You may well spend more waking hours with your dental partner than you will with your spouse, but few partnerships have the luxury of a long engagement period in which the parties really get to know each other. And like a marriage, partnerships can get involved fairly easily and quickly, but can take years of litigation and large "nancial losses in order to extract oneself from them.

Be sure you understand exactly what you are buying in a partnership it is a 50 per-cent (or less) undivided interest in a prac-tice, and its critical to know exactly what that means. Its especially important to know what the rules are as to getting into it, working within it, and getting out of it before ever committing to a partnership.

Another option is starting a new prac-tice. Advantages include being able to set up close to where you want to practice and being able to design your o)ce to your specs and choose your desired equipment. A new practice is most likely to be most successful in areas where there is the high-est demand for a dentist. However, these are usually undesirable areas where most dentists choose not to practice hence the demand for dentists. Dentists planning to locate in upscale suburban areas should

consider investing in a good demographic study before committing to such a venture. !ere are several excellent demographic study "rms that can provide valuable input as to what to expect in a start up. As you might imagine, the most desirable areas for a dentist to locate in are areas that are already saturated and the patient/dentist ratio is very thin. A new practice with no patients faces a huge challenge in having to rapidly gain new patients when legacy prac-tices in the area are losing active patients and revenues as a result of the economic decline.

New graduates will require expertise in setting up their new practice. O)ce leases and build-outs or new buildings need to be in place, employees need to be hired and trained, computer systems need to be pur-chased and put into place, e%ective mar-keting initiatives need to be implemented, insurance plans need to be evaluated and signed onto, and a number of other busi-ness details need to be accomplished, most of which the dentist has no training or knowledge in. !e economics of a new start are very

daunting. An accurate understanding of practice economics is critical to anyone considering starting a new practice. !ey are simple but are unknown to most den-tists.

Here is how it works: Every practice has a break-even point, typically in the range of $150,000 per year. With high rent and high bank payments it will be more and for a practice with low rent and no debt, it will be less. To compute it, the dentist with the help of a dentally experienced consultant should calculate what the expenses and debt service would be for the "rst $125,000 of income, and for each successive $25,000 income increment until the break-even point is discovered. !is is

Youve Got Your Diploma Now What?

EARL DOUGLAS DDS, MBA, BVAL

Getting Started

Earl Douglas DDS, MBA, BVAL


the point at which the expenses equal the income.!e wrong assumption is to assume that

practice overhead is around 60 percent and net income is around 40 percent of the gross revenues. !is erroneous assump-tion could lead a dentist to believe that at a gross income of $150,000 there would be a practice net income of $60,000, when, in fact, there would be no net income at all.

At practice gross revenues below the break-even point, the dentist will need to inject money into the practice in order to meet the overhead expenses and debt service. !e good news is that the dentist will net approximately 75 percent of the amount of collections above the break-even point, and this will be source of the practice net income. !e next step is to carefully develop a

budget of living expenses to see how much income the dentist will need for living expenses, and dont forget to include an allowance for income taxes. If the total amount of living expenses is divided by .75, this will result in how much above the break-even point the practice would need to collect in gross revenues in order to sup-port itself and the dentists living expenses. !ere should be a very realistic plan as to how that practice gross revenue "gure will be attained, or else the dentist will be bor-rowing money to live on.!e cost of starting a new practice needs

to be considered new technology, the build-out of o)ce space, equipment, computerization, and so on can add up to a "gure of $300,000 to $450,000 for a new o)ce. In addition, working capital will be required. !at is the money needed to pay the overhead and live on until the practice hits the break-even point and reaches pro"tability for providing a net income. !is option will involve sizable debt with potentially low income.!e fourth option is the purchase of an

existing practice. Practice purchases are the most predictable choice since they have a long informational track record. We can see what they have done for the past three years as opposed to a new start or associate-ship, in which we have no idea of what to expect. !ere is a great deal of documen-tation for practices for sale such as gross revenues, overhead by each category, net

income, fee schedules, employee analysis, insurance plans accepted, census of active patients, new patients, services performed and referred out, productivity rates, and much more.

An important advantage of purchasing a practice is that the projected net income of a practice is easily determined, and if it is not su)cient, the buyer can start look-ing for another practice that does have a successful net income. Another bene"t of

this predictability is that "nancing is typi-cally easier to obtain for a practice purchase since the risk is lower than for the other options. Lenders can review actual practice statistics and make a much better informed estimate of future "nancial outcomes and have better security for the future of their loan.

Purchasers of practices are always pleased to see a book full of scheduled treatment to

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See Diploma on page 35


TAMMARA PLANKERS

Getting Started

So youve decided to start your own dental practice after gradu-ation. Congratulations! You are about to embark on an exciting project and ful"lling career. Your "rst step towards reaching your ownership goal is to develop a business plan for your practice that details the viability of your venture.

A typical business plan outlines the business objectives, management and operational features, marketing plans and "nancial projections for your proposed practice. It is an indispensable tool for sharing your plans and solidifying support with your lender, contractor and vendors, and should be based on sound logic and

careful research.A good business

plan can take several months to prepare. To hit the ground running upon grad-uation, try to have your business plan completed before you leave dental

school. Use the free business plan tem-plates available from industry resources such as Wells Fargo Practice Finance to help organize your planning and research. (To download your template, visit wells-fargo.com/practice"nance and click on the New Dentists page.)

Key Components of the Business Plan

A business plan for a dental practice typically includes six components, each of which needs to be addressed in some detail. I. Executive Summary!e Executive Summary serves as an

introduction to you and your business

Plan to Succeed: Creating a Business Plan for Your Practice

venture. It is often the "rst impression your readers receive of your project, so it is important that the Executive Summary be concise, complete, and compelling enough to persuade lenders that your practice start-up plan is viable. !e Executive Summary typically

includes a Company Description, Mission Statement and Financing Requirements. In the Company Description, provide a brief overview of the type of practice you are developing and the services you will provide. Describe where your practice will be located and your target patient, and any specialties you will be o%ering.

Your Mission Statement outlines your practice philosophy and rationale for building your practice, while the Financing Requirements sec-tion provides a summary of the capital you will need to get your practice up and running.

After review-ing the Executive Summary, your reader should have a good idea of the

what, why and how of your new practice.

II. Practice Description

The Practice Description goes into greater detail about the structure

of your business, your quali"cations for managing the business, and your business resources. !is section tells your lender that you have the personal know-how and professional means at hand to help ensure practice success.

Elements of the Practice Description include your Practice History, which describes your professional experience to date such as where you went to dental school, when you graduated, and any professional experience youve gained; Management Team & Key Personnel, which identi"es the principals ultimately responsible for "nancial performance of your practice, as well as key team mem-bers and their roles; your Professional

Tammara Plankers


Advisors and how they will help you man-age and grow your business; your Business Structure, including your legal entity (Sole Proprietorship, etc.) and health insurance mix; and the Business Insurance you plan to have.

III. Market Research!e Market Research section demon-

strates that your future practice is based on a solid grasp of the local market and your potential for success. Your lender will look to see that you understand the community you are joining and have considered the competition in this area.

Include a Market Description that describes who lives in the community you have selected for your practice, and what sort of growth is predicted for this area over the next 10 years. Outline your Target Customer by describing your ideal patient, including characteristics, needs, income level, education, gender and age. Provide a Competitive Environment & Analysis sec-tion that de"nes how many other dentists are practicing in the area and the range of services they provide. And "nally, outline the Competitive Advantage your practice o%ers that your competitors do not.

Tools for completing this type of research are available online, including a Market Data Report with detailed practice loca-tion information o%ered by Wells Fargo Practice Finance at https://practice"nance.wellsfargo.com/market-data-report/. !e report is available for $75, or for free with your completed loan application.

IV. Marketing PlanIn this section you will describe the

internal and external marketing activities you plan to use to announce your opening and grow your practice. How will you attract patients and keep them coming back? How will you set yourself apart from the competition? Approximately how much are you budgeting for market-ing activities during the "rst year? What is your marketing mix the balance between print advertising, promotions, referrals, email, and other elements of marketing?

To ensure your marketing plan is realis-tic and e%ective, consider consulting with others who have successfully built a dental

practice from ground up. Find a mentor who can advise you on marketing and promotion techniques that can help build awareness for a new practice and grow business on a monthly basis.

V. Operations!e Operations section of your business

plan details the day-to-day needs and func-tions of your practice. It shows that, far more than just a dream or vision, your plan is a genuine blueprint for success based on well-thought-out ideas about how you intend to run your business.!e "rst part of the Operations section

outlines the Location & Premises of your new practice, including the exact location if available, why you chose it, and whether you will own or lease the space. Include the number of operatories in your practice and how many will be plumbed versus equipped.

Outline the Days & Hours of Operation so your lender understands what your work week looks like. If you will be associating while growing your practice, include that information as well. Detail the Equipment & Supplies necessary now and in the future, and who your major suppliers will be. !e Operations section also addresses

Sta)ng, including your recruitment plans, sta% roles, compensation and personnel

policies. You do not need to include job descriptions, but identify the resources you are using to create those job descriptions.

VI. Financial Forecast!e Financial Forecast is probably the

most di)cult section to complete, as well as the most important. !e "nancing package you receive from your lender is based on the numbers in your forecast, so it is critical that you do your homework and make these calculations as accurate as possible. Turn to the resources available to you for guidance in completing your calculations, such as a dental CPA, practice lender, accountant and industry mentor. !e forecast includes an Income & Cash

Flow Projection for the "rst 12 months of practice operation. Your projected income is based on the number and type of proce-dures performed per week, and will likely grow over time. Your cash ,ow is the dif-ference between your gross income minus operating expenses and overhead. !e forecast outlines Capital & Operating

Expenses as well, or the total funds needed to build and operate your new practice. Try to be as speci"c as possible, including categories such as contractor costs, loan pay-ments, sta% salaries, rent, utilities, lab fees, supplies and other minor expenses.


Aspen Dental877-330-1349www.AspenDentalJobs.com

At Aspen Dental we recognize that our success is a direct result of empowering and supporting ambitious dental professionals. We provide a professional, fast-paced, entrepreneurial work environ-ment based on a mutual respect that keeps our interests aligned together, we build and develop successful, patient focused dental practices. Please see our ad on page 31.

The Artist Evolution LLCToll Free: 866-610-5334 www.theartistevolution.com

The Artist Evolution is a full service, strategic marketing and design firm with a passion for helping practices around the country to communicate effectively with their target patients, to develop an identifiable brand, and to meet their objectives in a cost-effective way. Please see our ad on page 9.


!e Project Financing component of the forecast details how much you need in "nancing to build and launch your practice, and the terms you are looking for. Include here any personal funds or assets, if any, that you will be contributing to the project.

Tips for Completing Your Business Plan t Be clear and thorough in creating your

plan. Include a formal title page or cover for the plan and make sure your writing is grammatically correct and slang-free. Remember that your busi-ness plan provides the "rst impression of you as a business person, so make it an accurate and professional representa-tion of your capabilities and objectives.

t If you lack writing skills, consider con-tracting with a freelance writer to devel-op your plan. A well-written, organized

document gives your vendors a positive impression of your business skills as well as con"dence that you can manage a project of this magnitude.

t Do your research dont guess! Your "nancing package will be based on the "nancial projections included in your plan. You dont want to "nd yourself unable to ful"ll your vision simply because you didnt do your homework thoroughly.

t Build a team of advisors who can help with plan and start-up details, including a dental CPA, attorney, dental practice designer, contractor, and practice "nance lender. A strong advisory team can help you save considerable time and money in implementing your practice vision.

t Remember that your business plan is a living document that should be updat-ed periodically as circumstances change.

With a business plan for your practice in hand, youve got a jump-start on the com-petition namely, new graduates who have not yet formulated their career plans. So if possible, get your business plan started now so you can begin planning your success for years to come. Q

Tammara Plankers, Assistant Vice President, Client Practice Services for Wells Fargo Prac-tice Finance, helps doctors establish and grow their new practices. A Certi'ed Executive Coach and practice consultant for over 15 years, Tammara assists practitioners in successfully transitioning to practice ownership through the use of proper due diligence, and guides them in developing the management and leadership skills necessary to successfully operate a practice. Tammara can be reached at 888.499.8871 or [email protected].

Practice Makes Perfect

Get off to the perfect start. Call your ADS transition specialist for AL, GA, LA, MS, NC, SC, TN and VA today.

ADS South (770) 664-1982

Dr. Earl Douglas and the staff at ADS South have been realhelpful in steering me in the right direction in the purchase ofmy first practice. Dr. Douglass experience, organization anddetail-orientation, pointed out to me where improvement isneeded and how to go about achieving it.Elizabeth H. Guerrero, DDS

ADSsouth.com

ADS.south209 2/25/09 1:42 PM Page 1

Before you see your fi rst patient, youre going to have to choose dental malpractice insurance coverage. Some new dentists give it little thought and automatically settle for the fi rst insurer they hear about or use their employers company. But its your career on the line, and there are signifi cant differences in the quality and value of companies and coverage available. Choose the company that more dentists have trusted since 1899 to protect their reputations, practices and assets. Choose the strongest malpractice insurer Medical Protective.

Ask about our malpractice protection specifi cally designed for new graduates.

[email protected] www.medpro.com 800-4MEDPRO

When selecting dental malpractice insurance, you should choose:

DENTAL MALPRACTICE EXAM

The company with the strongest claims defenseThe most experienced companyThe dental malpractice company with the highest ! nancial ratingsMedical Protective is All of the Above

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Historically, the goal of most den-tists was to form a solo practice. In recent years, this trend has shifted with more partnerships being formed than in years past. Coupled with the fact that many recent graduates prefer not to practice alone, the opportuni-

ties for partnerships as a career choice are de"nitely on the rise.

If you are plan-ning to work as an associate and become a partner, you need to know some of the key ingredients that can lead to a successful

partnership. In this article, well address several of those key points you need to consider when contemplating forming or joining a partnership.

Personality/Compatibility It goes without saying that you have to like and respect the individual(s) that you will be spending more time with on a daily basis than with your spouse! Communication and openness are important ingredients for a successful relationship. You dont have to be best friends, but there has to exist a mutual respect and trust that both parties are working toward the same goal of mak-ing the partnership successful.

Clinical Philosophy As a young den-tist, youll spend years developing your

own clinical philosophy. !is is not in,u-enced just by your experiences from dental school, but by the many hours after gradu-ation that you will be investing in continu-ing education and professional associations. Having a clear understanding of your mutual philosophies of patient care is a

necessary dialogue you will need to have when forming your partnership.

Will you be an Equal Partner?- Oftentimes, the practice owner partner wishes to maintain control when forming a partnership with an associate, so a partner-ship arrangement with the senior partner desiring a 51-percent interest and the junior partner a 49-percent interest is not uncom-mon. However, in our opinion, that sends the wrong message to the new partner. !e fear of loss of control is a common feeling solo practitioners share when they decide to make their associate a partner. You will need to determine whether or not you want another individual controlling your actions as a partner. Some young doctors may agree to this arrangement for the initial few years of the partnership, but do require that the partnership become a 50-50 arrangement at a future date.

Income Division Poorly conceived division of income has led to many part-nership breakups. In the dental world, partners should be compensated based on a combination of personal clinical production and their respective ownership interest. As the senior partner begins to decrease his/her production in the later years, this approach will prevent the junior partner feeling that he or she is being taken advantage of, if income were shared equally. Most arguments over money occur when one party feels they are doing more of the work and not being compensated fairly. An income sharing formula whereby each partner is compensated based on their relative ratio of personal clinical produc-tion with direct expenses being allocated accordingly, is a fair way to compensate each partner for their production related portion of partner income.ly. Conversely,

if overhead is not shared properly that can lead to problems as well. For exam-ple, if one partner utilizes two assistants and one partner uses only one assistant, should those expenses be shared equally? Allocating those assistants directly as part of the compensation formula is only one example of how this concept works.

Establishing Minimum Days/Production Goals As partners grow older, they may be unable to produce at the same performance level as they did in years past. Conversely, if a partner is "nan-cially secure, he/she may not desire to work as hard as they once did. So, establishing minimal production goals to maintain partnership status is not unrealistic criteria to include in your partnership agreement. Some agreements may also require the partners to practice an annual minimum number of days.

Premature Retirement One of the reasons you may want to become a partner is to maintain a long-term relationship with another doctor. In the event that one partner decides to leave prematurely, a penalty should be included that will discount the buy-out value of the depart-ing partner. We prefer to use a sliding scale discounting factor, based on a pre-retirement age to calculate the departing partners decreased value, with the sooner they retire the greater the discount to value.

Management Responsibilities Not all partners share management responsibilities equally, and in fact, some partners have no interest in any aspects of the day to day management of the practice. !ey basically just want to perform only on a clinical level. In this case, the partner who is managing the practice and who probably spends many hours per week doing, so should be com-

TOM SNYDER DMD, MBA

Business Fundamentals

Creating a Successful Partnership:What to Include in Your Partnership Agreement

Tom Snyder DMD, MBA


pensated accordingly. Negotiating either a "xed salary or a percentage of pro"t as additional compensation for a partner who is responsible for the day-to-day operations of the practice is a fair approach. !is com-pensation should be considered an expense of the practice and have no relationship-to-ownership percentage or production-contri-bution levels.

Death and Disability Most partners purchase life insurance in the event of an untimely death. So it is an important habit for partners to develop by reviewing the amount of life insurance to ensure that the face amount of the policy keeps up with the changing value of the practice over time. In the case of partners long-term disability, we have seen many lawsuits occur due to insu)cient de"nitions of disability, as well as poorly crafted valua-tion formulas and payment terms in the event of a disability. !erefore, you need to have clearly de"ned valuation formulae in your agreement that addresses the value of a partners interest in the event of death or disability.

Mandatory Buy-Out Too often, weve been retained to negotiate situations where the senior partner encounters dif-"culty in selling his remaining interest to the junior partner. We believe that the partnership transition model consists of two parts: a Buy-in and a Buy-out. A clearly de"ned intention of the junior part-ners expectation to purchase the senior partners remaining interest at a speci"ed date is critical. !is is especially true in markets where it is di)cult to recruit asso-ciates, i.e. small towns and rural areas. A properly designed buy-out formula needs to be included in the agreement so all parties know what to expect beforehand. Finally, in the unlikely event that the junior partner decides not to honor the mandatory buy-out, a liquidated damages clause should be included as a "nancial penalty for not completing the purchase of the retiring partners interest.

Partnership Valuation Senior part-ners sometimes expect too much for their practices value at the end of their career. !is especially becomes a problem if they have not been contributing signi"cantly to the practice in their later years, and they expect 50 percent of the practices value.

We recommend that a buy-out formula be included in the partnership agreement that will reduce the senior partner value of his/her partnership interest if clinical production decreases over the last several years preceding retirement. !is approach allows the junior partner to pay a fair price for the value of the senior partners interest. !is discount, however, is applied only to the Intangible Asset (Goodwill) portion of the senior partners practice value. For example, if the retiring partners clinical production has decreased over the last three years on average by 20 per-

cent, the Intangible Asset Value would be reduced by 20 percent. !e Tangible Assets (equipment, technology, etc.) should not be discounted, as these are assets having no bearing on the performance of the senior partner. So, for example if you have a 50-50 partnership, the Tangible Assets value for the retiring partner would be worth 50 percent of the appraised value at the time of sale.

Properly designed Partnership/Shareholder Agreements must be crafted in order to avoid unnecessary problems and legal costs to avoid failed partner-ships. An ounce of prevention is worth a

pound of cure and spending the time and money at the beginning of your relation-ship to have properly designed agreements will go a long way in solving any future problems. Q

Dr. Tom Snyder is managing partner of +e Snyder Group LLC. A transition services consulting 'rm that specializes in practice valuations, practice sales as well as design-ing associate and partner relationships. He can be reached at (800) 988-5674 or email: [email protected]. +e 'rms website is www.snydergroup.net


Bank of America Practice Solutions1.800.491.3623www.bankofamerica.com/practicesolutions

Bank of America is endorsed by more dental associations than any other lending institution. We also have trusted relationships with industry leaders who seek our financial expertise andworld-class service.*Subject to credit approval (Please see our ad on page 25.)

Henry Schein Professional Practice Transitions (PPT)[email protected]/ppt

Henry Schein Professional Practice Transitions (PPT) is the practice sales division of Henry Schein, Inc. Our affiliation with the largest dental supply company in the countryintent on servicing the practice buyers future supply, equipment and service needs makes PPT the only company with a vested interest in the buyer and a careerlong trusted relationship with the seller. (Please see our ad on the inside back cover.)

Aspen Dental877-330-1349www.AspenDentalJobs.com/228

At Aspen Dental we recognize that our success is a direct result of empowering and supporting ambitious dental professionals. We provide a professional, fast-paced, entrepreneurial work environ-ment based on a mutual respect that keeps our interests aligned. Together, we build and develop successful, patient focused dental practices. Please see our ad on page 31.

In the dental world, partners should be compensated based on a combination of personal clinical

produ>ion and their respe>ive ownership

interest.


I just "nished another audit for a doctor who is in trouble with a regulatory agency, and the issues remain the same. !e docu-mentation does not support the treatment provided. !is doctor faces signi"cant "nancial loss.

!e entity is asking for repayment for the unjusti"ed services and the demand is sub-stantial. OUCH!

If its not in your dental record, you didnt see it, you didnt say it, you didnt do it, it didnt need to be done and it doesnt exist from a legal perspective. My plea to you is to be careful to document in such a way that theres no question left unanswered, no service provided left to the imagination. !e dental record should read like a story that has a beginning, middle and end where everything is recorded. I know, I know. !ere are only so many hours in a day, but ask this doctor who will most probably write a six-"gure check. !e time taken to document completely would have been very well spent and could have ultimately pre-vented this action. When you are tempted to cut corners in your recordkeeping, billing and coding systems weigh the consequences and choose wisely. Take it from me, defend-ing yourself and your practice is priceless.

What should the record contain? Comprehensive Medical and Dental Historyt Review the history thoroughly at the "rst visit and update at all subsequent visitst Revisit with a more comprehensive

review as needed (the more compro-mised the patients health, the more often the medical history should be reviewed. Err on the side of caution).t Do a Rx review and run a drug interac-

tion screen. Consider using epocrates or lexacon. http://www.epocrates.com or

I understand, as a dental student and soon to be dentist, record keeping may be the very last item on your priority list. Been there, done that and lost the t-shirt.... literally. You see, I not only lost my t-shirt, but almost everything I owned, except the love and concern of my fam-ily and friends, but thats another story for another day. I have come to appreciate the fact that it is a wise man who learns from his mistakes, but a wiser man still who learns from anothers. I was found guilty of health-

care fraud, racketeer-ing and structuring just as my son was graduating from dental school in the spring of 2008. I spent 19 months in federal prison and two months in a halfway house, for-

feited $200,000 as a result of the racketeer-ing and structuring convictions and paid back the $17,899.57 I received over the course of 6 years from the Medicaid pro-gram that I was not entitled.

I learned the hard way that if its not in your dental record: 1. It was not seen2. It was not said3. It was not heard4. It didnt need to be done5. It wasnt done6. It doesnt exist from the legal

perspectiveYour record can literally make the dif-

ference in a jurys verdict, the dismissal of a malpractice claim, a review by the dental board that "nds no grounds for action, or a clean insurance audit. I was accused of fraud, in part because my dental record did not justify the need for treatment. In fact,

DR. ROY SHELBURNE


Things every new graduate should know about record keeping!

http://www.lexi.com t Review histories before each visit there-

after, even if seen two times on the same day.t!e histories must be reviewed, doc-

umented and any modi"cations of treatment necessary as a result of the Medical condition of the patient should be noted and followed.

Documented Detailed Clinical Examinationt Remember, an oral cancer screen is

mandatory when reporting most exami-nations for reimbursement. Make note that the screening was conducted and the result.

Hard and Soft Tissue Exam:t Soft tissues: lips, gingiva, buccal mucosa,

tongue palate.t Periodontal evaluation/charting for

every patient (establish your o)ces protocol).t Hard tissues: bone and teeth.t!e record should be complete and

specify what information was evalu-ated to determine the treatment recom-mended/provided.

Radiographs/Photographt Record Normal Findings and Abnormal "ndings including:t Head and neck.t Soft tissues/photos.t Hard tissues/radiographs/photos.

TMJ evaluation Caries Risk Assessment: CAMBRAChief ComplainttWhy is the patient in your o)ce?t Establish the expectations from the

patient.t If no problem is stated, record the rea-

son for the visit. t Be aware that the chief complaint may

change so note each visit.

Dr. Roy Shelburne


List a De!nitive Diagnosist Treatment Plans should address all

abnormalities.t Complete documentation includes the

diagnostic tools used to arrive at that de"nitive diagnosis.t Diagnosis should list the location and

extent of the pathology.Informed Consentt Treatment needed.t Reason for treatment recommendations.t Material treatment risks.t Bene"ts.t Clinically accepted alternatives.t Cost relative to treatment recommenda-

tions.Treatment Renderedt Anesthesia: amounts, types, and loca-

tions.t Numbness.t Procedure.t Materials used.t Any negative outcomes.

t Does stu% happen?t Inform.t Deal with additional treatment/referrals.t Refusal of any kind or request to modify

treatment.Reason for Next Appointmentt Treatment should be sequenced to

address the condition of greatest concern.t Address the chief complaint.t Address the reason for the sequence.t Get agreement from the patient for the

next appointment. Note Any ReferralstWhere was the patient referred?t Reason for the referral.t Lack of compliance.

All Prescriptions Writtent List prescriptions separately and include

number and strengths.t Indicate what the prescription is to treat.t Inform the patient of any possible side

e%ects.tWhat to do if they experience any

untoward e%ects from the medications.t (Check with your state regarding the Rx.

database).All Phone Conversationst Conversations with business sta%.t Conversations with clinical sta%.t Conversation with the doctor.t Conversation with the referring doctor

about that patient.Cancelled/Missed Appointmentst Compliance can be very important to

outcomes.Remember!Make your notations at the time of the

visit, phone call, conversationIf a correction or addition is needed, note

when and why the correction was made.Subjective comments about the patient

are not to be recorded in the treatment record!

Be very careful with your choice of words.

Making that first transition into your career is the most important decision you will ever make. For morethan 30 years, ADS and its local transition specialists have helped dental graduates like you make the perfectfirst transition. As the nationwide leaders in practice purchases, we know the best opportunities whereverit is that you want to be. We are dedicated to your success.

Get off to the perfect start. Visit us online to find your local ADS representative.

Make theperfect transition

ADStransitions.com/localrep

ADSNL_003 Half Page Ad REV2.qxd:Layout 1 2/14/09 6:36 PM Page 1 See Record Keeping on page 35


True False1. I dont have a spouse or kids yet, so I dont need life or disability insurance. 2. When insurance is cheap, the quality is cheap, too. 3. All disability policies are the same. 4. A fully loaded policy is always the best choice. 5. Locked-in premiums are better than premiums that change over time. 6. Ill get the best service through a local insurance agent. 7. Im young and healthy, so it will be easy for me to get insurance.

LESLIE FRANKLIN


Fact or Fiction? Quiz Yourself on Personal Insurance Myths & Misconceptions

If the quiz above got your attention, thats great! Youve likely heard a lot of misleading, incomplete, and down-right confusing information about life and disability insurance. Acting on misin-formation can cost you hassles and money, or worse, it can lead to poor decisions that you may regret later but cant undo. And not taking any action at all can create its own problems. So lets dispel 7 common myths and misconceptions.

1. I dont have a spouse or kids yet, so I dont need life or disability insurance.

Possibly. But you likely still have "nan-cial responsibilities. !ink of your student loans, car payment, credit card debt, rent/

mortgage How would such obliga-tions be handled if you suddenly died or became disabled? !is isnt fun stu%

to think about, but its very real. Young people die every day in accidents or

unexpected events. And its widely known that dentists face an above-average risk of disability because of the physical demands of clinical practice. So dont make the mis-take of thinking, It wont happen to me. !e fact is, you likely do need life

and disability insurance protection even before you start a family. !ese products also play an important role in business, like providing collateral for a practice loan or funding a buy-sell agreement with a business partner, which are independent of your personal life. 2. When insurance is cheap, the quality is cheap, too.

Maybe, but not always! You often hear, You get what you pay for, but excep-tions do exist. For example, the American Dental Association is able to o%er its members group insurance with high-quality coverage features at surprisingly low rates. How? Volume buying power, low overhead, experience-based discounts, and an intimate understanding of dentists that results in focused (and thus e)cient) underwriting and claims handling. Some ADA coverage is even free to student members because thats how the ADA chooses to invest in its future member-ship. 3. All disability policies are the same.

De"nitely not true! Disability insur-ance is a complicated product, and there are lots of variations in quality and price. You have to take time to read the contract, compare features, and ask questions to make sure you know what youre getting.

One of the most important things to examine is how the policy de"nes disabil-

ity. An own occupation policy, preferred by most dentists, pays a bene"t if an inju-ry or sickness prevents you from working as a dentist even if you could hold down a di%erent job.

But own occupation policies are not all the same. A true own occupation policy will pay full bene"ts if you cant work in your special area of dentistryeven if you could do other types of dentistry or could pursue another career like teachingregardless of how much money you earn while disabled. Also consider the time period you could receive own occupation bene"ts: Some policies limit those ben-e"ts to just a few years, and then switch to a de"nition of disability that is harder to satisfy. Make sure you know how to spot these di%erences. 4. A fully loaded policy is always the best choice.

False. It may be tempting to go for the deluxe model, but why pay extra for bells and whistles if you dont need or want them? Budget-conscious dentists often look for a basic policy and then add only the options (also called riders) that "t their particular needs.

For example, if you want to guaran-tee that you can increase your coverage without having to take another medical exam, it could be worth it to add a future increase option to your basic plan. On the

Leslie Franklin


PRACTICE EXPERIENCESMWITHPATTERSONDENTAL.Call 800-873-7683 or visit www.pattersondental.com to start living your dental dreams.

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P110369d_7_375x5_437:Layout 1 11/10/11 5:51 PM Page 1

other hand, a cost of living adjustment (COLA) option may not be the best use of your money when you could rely on other sources of income during a dis-ability (spouse salary, product sales, etc.) to combat in,ation. A souped-up policy that over-addresses your needs may be no deal after all.5. Locked-in premiums are better than premiums that change over time.

On the surface, this might seem true. It may feel comfortable knowing youll pay the same amount each year for the life of your policy. But if you look more closely at how these policies work, youll see that level premium policies charge more in the beginning than your relative risk of death or disability at the time, in order to keep premiums the same as you grow older and your risk increases. If you discontinue your coverage before the term ends, you will have likely overpaid for the time you were insured. And if you need to keep the insurance longer than originally planned,

your rates can spike dramatically when you begin a new term (in which case, youd be locked in with no alternative but to pay the higher rates or go without coverage).

In contrast, pay-as-you-go policies, with premiums that gradually increase with your age and subsequent risk, can give you more ,exibility and control: You dont have to determine up front how long you will need the insurance. Plus, your insurance costs are lowest at the very time when youre starting out and money is tight. (In fact, most "nancial advisors will recommend you pay as little as pos-sible and invest the rest on your own.) In

rare instances, your premiums could even go down in some years, which has been a recurring and pleasant surprise for ADA plan participants throughout the past 10 years.

In addition, policies with graded pre-miums generally do not make you go through another medical exam to con-tinue coverage, so you know that you can keep your insurance into old age even if you are hit with health problems along the way. 6. Ill get the best service through a local insurance agent.

Not necessarily. Using an insurance agent or broker is a personal decision. Some people like face-to-face meetings with an agent. However, many dentists discover they can obtain su)cient infor-mation from a companys website and/or call center to make an informed decision and avoid costly agent commissions. In fact, they often prefer doing business online or over the phone so they can get

A souped-up policy that over-addresses

your needs may be no deal after all.


information when and how they want it without having to endure time-consum-ing or uncomfortable sales pitches.

Whats more important is to investigate the company or organization that stands behind the policyits strength, stabil-ity, and reputation among your peers. For example, the ADA demands solid "nancial management and exemplary ser-vice from Great-West Life & Annuity Insurance Company, the company that underwrites and administers the ADA Insurance Plans. Many dentists like the idea of having their insurance selected by a professional association they know and respect.

In the end, it may come down to trustwhat company/policy/personnel you trust most to be there for you in a time of need. Everything may look rosy on the front end, but things could get ugly later if you make a poor choice. To con"rm your instincts, solicit recom-mendations from colleagues and mentors, check independent rating services like A.M. Best, and ask the insurance com-pany your most probing questions. How they handle your inquiries may help you predict how theyd handle more serious matters like a death or disability.

7. Im young and healthy, so it will be easy for me to get insurance.!ats truemost of the time. But

you might be surprised at the things that could a%ect your ability to get insurance coverage at the best rates or without any restrictions.

Family history, an old injury, past ill-ness, or the use of certain prescription medications could raise a red ,ag when the insurance companys underwriter evaluates your risk of disability or death, and could a%ect the price you pay or the coverage features youre o%ered. For example, a former back injury might

cause the company to exclude back prob-lems from disability coverage but provide coverage for all other causes of disability. (Note: Most insurance companies use similar underwriting processes and infor-mation repositories; anything discovered by one carriers underwriter will likely be available to other insurers, too.)

What else could a%ect your insurabil-ity? If you use tobacco in any form, your coverage will likely cost more. A driving record with multiple moving violations or DUIs also can raise your rates or even cause your application to be declined. Participating in extreme sports like hang gliding, car racing, or piloting private air-craft could make it more di)cult or more costly to get insurance. Even your gender statistically in,uences the risk of death or disability and can result in higher premi-ums for some policies. !ese principles may not sound fair, but this is an area where statistics do rule.

If you ever are considered less-than-perfect health-wise, its not the end of the world: You may be able to re-apply at some point in the future, and might qualify for lower rates or lifted restrictions if your situation changes. Also, watch for opportunities for guarantee issue insur-ancecoverage that does not require a medical exambecause you cant be turned down.

One "nal word to the wise: Do the smart thing by getting as much insurance as you need as soon as you can because you will never be younger than you are today. Q

Editors note: !is article does not constitute legal, tax, or "nancial advice. Please seek professional input as appropri-ate to your situation.

Leslie Franklin is Director of New Dentist Markets at Great-West Life & Annuity Insurance Company. She helps new dentists and dental students use insurance to attain their personal and professional goals. For more information about ADA-sponsored insurance costs, coverage, limitations, and terms for keeping coverage in force, call (888) 463-4545, e-mail [email protected], or visit www.insurance.ada.org.

MacPractice, Inc(402) 420-2430 MacPractice.com

MacPractice DDS is the leading practice management and clinical application for dentists who prefer to use a Mac, featuring elec-tronic insurance submission, Mac native digital radiography and photos, charting, Electronic Dental Records, Kiosk, Web Interface, iPhone Interface, speech dictation, and Mac stability and ease of use. Please see our ad on page 27.

Medical Protective800-4MEDPRO www.medpro.com

Since 1899 Medical Protective has been the nations leader in dental professional liability. As a member of the Berkshire Hathaway group of businesses, Medical Protective provides den-tists and oral surgeons with four levels of unmatched protection

- strength, defense, solutions, since 1899. For more information, visit www.medpro.com or call 800-4MEDPRO. Please see our ad on page 13.


Lightspeed Multimedia, Inc.Email: [email protected]

Dont settle for the same generic look as every other dental profes-sional in the area! Stand out with a professionally designed image created for you and your practice.

Do the smart thing by getting as much

insurance as you need as soon as you can

because you will never be younger than you

are today.

2012 P&G

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Dont lose us a!er graduation. Go to dentalcare.com and update your profile so we can stay in touch with news for your patients and your practice.

And dont forget to take advantage of student pricing while you still canplace your order at dentalcare.com today!

Counting down to the day you graduate?


Unlock the Mystery of E%ective Practice Marketing:

DEREK CHAMPAGNE

Practice Builders

You have opened the doors to your new practice. You have the perfect location with a nicely designed o)ce space. Your technology is up-to-date, and you have hired a knowl-edgeable and friendly sta%. You have a small core of reliable patients but start to notice that you are not experiencing steady growth. You know that it is time for some marketing and advertising. Maybe you are contemplating featuring a service on Grou-pon or another couponing site, having your sta% post on social media every week, buying some Google adwords to help SEO presence, or even sending your hygienist to hand out brochures at local health fairs.

Warning: During any given month, you and your sta% will be solicited at least a dozen times by various print, TV, coupon-ing sites, online ads and other advertising

opportunities from sales vendors in the community. You cant possibly par-ticipate in all of the advertising options presented to you. Which ones will get you the best return and which ones will

be a waste of your hard-earned money? You may decide to take a chance on a few advertising possibilities while crossing your "ngers and hoping that one will work.

I call this approach blindfold market-ing randomly selecting a variety of media with a variety of messages, hoping that one will hit something valuable. !e problem with blindfold marketing is that it is generally not cost-e%ective, it confuses your audience, and it does not always build

measurable trust, value, or recognition to your brand or campaign. While there is some calculated risk in advertising the blindfold approach is dangerous long term, since a signi"cant portion of your growth is reliant on these marketing and advertis-ing e%orts.

In assessments with numerous dental practices across the country, I have found four major problem areas that commonly hinder e%ective practice marketing: lack of identity and message strategy, lack of or improper marketing tools, and no orga-nized plan/campaign. Addressing these four areas before you open your practice can save years of frustration, money, and guesswork.

IdentityWho are you? Know who you are so that

you can tell others and so that they will recognize your unique signature (your brand). Most simply, your brand is what people know and think about your prac-tice. If they dont know who you are or that you exist you dont really have a brand identity. A corporate identity builds trust and

recognition. !is is the visual part of your brand that should re,ect your company in an honest way and should relate to your industry, your name and de"ning charac-teristics about your practice or the com-petitive advantage that you o%er. Be unique and present yourself clearly and dynami-cally. It is very important that your identity is consistent, with marketing materials that have a similar look and feel. Each piece should contribute to your overall brand equity. !ese branded materials will also

Derek Champagne

Choosing the Right Identity, Message and Plan


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give your marketing e%orts more bang for your buck and make your practice more recognizable.

One way of achieving this consistency is by using brand standards. Brand standard are design rules focusing on your logo, graphics, colors, fonts and illustrative style. !ese rules work by creating aware-ness about your brand and di%erentiat-ing your practice from your competition. When youve identi"ed rules for the above areas, document them as a standards guide for use by employees, vendors and graphic designers.

MessageConsumers are exposed to thousands

of brand messages each day (subtle and blatant), giving your practice only a few seconds to share your values, de"ne what makes you di%erent, and explain why the target patient should schedule their "rst appointment with you. A message strategy empowers you to intentionally tailor your communication with your target patients so that they quickly identify with the val-ues and unique positioning of your prac-tice and readily understand how engaging with your brand will enrich both their lives and their loved ones lives.Communication can only occur when

you successfully break through the clut-ter with a relevant message that resonates with your target and motivates them to respond. In order to create a message

that will resonate with them, you must "rst identify and understand your target. Narrow your target into speci"c segments to further identify what motivates them. Consider what their core needs are and how your service addresses those core needs. Next, you should research the pro"les, patterns, preferences, and envi-ronment of your target. Like most prac-tices, you will discover that you have a few targets on which you are focusing. Maybe you are seeking more cosmetic patients or restorative patients. !ese may be entirely di%erent targets and each need a tailored message that is consistent and relevant to give it sticking power.

Having a message strategy also empow-ers your sta% to properly represent your brand and empowers patients to refer you to others. Patients will appreciate your ser-vice but may be unsure why they should share you with others. An e%ective mes-sage strategy frames up what makes you unique and reinforces the value of your service so patients and sta% can readily share the unique values of your practice with others.

Exercise:Answering the following questions will

help you create the framework of your own unique identity and message strategy:tFor what do you want to be known?tWho are your ideal target patients?tIdentify the core services that you will

o%er: How do they address the core needs of your target?tIn relationship to your o%erings, what

services do your target patients need most? What motivates them? What are they most concerned about? And what will you deliver to address those needs?tHow do you want to be perceived by

your target patients and community?tWhat moods or emotions would you

like associated with your practice?tWhat emotional connection can be

made that will help your target better identify with your services?tWhat is the single most important

An e%e>ive message strategy frames up what makes you

unique and reinforces the value of your

service so patients and sta% can readily share the unique values of your pra>ice with

others.



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Patterson Dental Supply Inc. is a full-service distributor of a com-plete range of dental products and services to dentists, dental laboratories, institutions and other healthcare providers throughout North America. As one of the nations largest dental distributors, Patterson Dental sells consumable dental supplies, digital and other dental equipment and practice management software. Please see our advertisement on the inside of the front cover and page 1.

PARAGON Dental Practice Transitions www.paragon.us.com866-898-1867

Offices located Nationwide. PARAGON offers professional consulta-tion and related services to healthcare professions with primary emphasis on the dental profession: comprehensive dental prac-tice valuations (including a written valuation and analysis report); practice sales; pre-retirement sales; practice acquisitions; practice mergers; associateships; partnerships; practice consolidations and practice management. References available by request. Please see our ad on page 23.

Oxyfresh Worldwide Inc. 800-333-7374 ref# [email protected]

Since 1984 thousands of dental professionals have discovered Oxyfreshs safe and effective oral health products for use in long-term care and maintenance of their patients. Retail sales, wholesale rebates and free product programs allow you to get paid appro-priately for providing professional guidance and instruction to your patients. Ad on page 35.

thing you want your target patients and community to associate with your practice?tWhy will your target patients choose

you over your competitor? What makes you unique?tWhat will be your promise? What are

your Values? What is your Mission? After completing this exercise, frame

your answers into a few well-crafted para-graphs. Practice sharing your newly-crafted message with sta%, patients and your com-munity and make adjustments until you can share comfortably.

An Integrated Marketing Plan:!is is not a typical business/market-

ing plan that includes the marketing mix, SWOTT analysis, and other details needed to get approved for a business loan. !is is a new wave: a focused plan for you to use in executing an integrated marketing plan. !is plan is focused on garnering new patients, keeping existing patients, and building goodwill with your community.My own hybrid de"nition of market-

ing is this: e%ective marketing is not one single action; it is a collaboration of several dedicated, strategic e%orts that are executed holistically. Success results from sharing a cohesive and relevant brand message across multiple platforms, using appropri-

ate marketing tools and executing several strategies with frequency against pre-stated objectives. Disjointed e%orts can work, but they are more di)cult to build upon and they do not add as much value to brand recognition (equity), message and the over-all value of the campaign.

Creating a marketing plan is a balance of creativity and strategy. A good marketing plan contains speci"c tactics for reaching each of your target patients with sensitivity to your speci"c budget. !e plan should

be executed against suggested timelines, frequencies and measures for success. It should also be designed speci"cally for you to reach your target clients in their unique environments. !e end goal is to have a comprehensive plan with a cohesive mes-sage theme guiding patients towards a tar-geted action or place (such as your website) and positioned in venues and mediums where they are most likely to respond.

Steps in building your integrated marketing campaign:

ObjectivestClearly de"ne your short and long-

term objectives (Examples: To increase # of implant cases by x, increase # of quality cosmetic cases by x, etc.).

BudgettCreate a Budget - % of revenue allo-

cated to marketing.t Build speci"c strategies into targeted

campaigns to reach each patient seg-ment. Your overall campaign should have multiple strategies for each target that you identi"ed during your messag-ing development.

External MarketingtSelect two or so traditional core exter-

nal drivers for driving awareness to your target patients. !ese may be radio, television, print, direct mail, or other advertising platforms, but the key is to share a consistent and concise message that stays the same across multiple advertising platforms. You should have a clear and measurable call to action and select the advertising platform based on where your target patients are most clustered as identi-"ed in your message strategytSet up a solid web and social media

presence for search engine optimiza-tion (SEO) and conversion rate opti-mization (CRO. !e goal is to increase the number of patients who sched-ule an appointment after visiting your website or social media outlets.tSet up other external platforms, such

as a PR campaign that creates aware-ness about your practice each quarter. Adopt or start a community cause,

Success results from sharing a cohesive and relevant brand

message across multiple platforms, using appropriate

marketing tools and executing several strategies with

frequency against pre-stated obje>ives.

Business debt consolidation Tired of having to process multiple payments all at different interest rates? Improve your cash flow with a debt consolidation loan.

Commercial real estate* Choose from a suite of comprehensive real estate loan options to buy, refinance, or relocate your practice. Why lease when you can buy?

Equipment financing* Choose from a variety of options and flexible terms tailored to meet your needs.

Practice Acquisition: Up to 100% financing for your

practice up to $5,000,000.

12-month interest-only options for lower payments initially.

Principal reduction and early payoff options.

Practice purchase and real estate combination loans.

Working capital to help you with the transition.

Terms up to 15 years.

Access to our complimentary Practice Heartbeat program.

* All programs subject to credit approval and loan amounts are subject to creditworthiness. Some restrictions may apply. Bank of America Practice Solutions may prohibit use of an account to pay off or pay down another Bank of America account. Bank of America Practice Solutions makes no express or implied warranties with respect to any aspect of the Practice Heartbeat program, nor does it guaranty any success or promise any results, and hereby disclaims the same to the

extent allowed by law. The opinions of Bank of America Practice Solutions are based upon prior experience, and it makes no promise or guaranty that you will achieve any particular measure of success or results by participating in the program. You are not bound by any recommendations provided under this program and retain full responsibility for the results achieved by your professional practice.

Bank of America Practice Solutions engages Scott McDonald & Associates, a national marketing !rm specializing in de

dental entrepreneur - spring 2012

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