Question from DSN User:
“For those of you paying associates using adjusted production, how are you calculating it in real time? Our write offs don’t occur until after insurance payments come in so how do you calculate this number per pay period? Don’t really want to get into having a different fee schedule for each insurance plan so looking for other ideas.”
From one user:
- I’d look at 2018 % write off, and just apply that number.
- Pay a daily rate, pay their “bonus” on adj prod every 3 months
- Pay them off of collection, or update your fee schedules. Or, pay them a guarantee for 6 weeks, after that pay them on a rolling 5 week lag, so for April, they would get paid first week of May after Adj have been accounted for. Nothing will be perfect in this case, but my ultimate vote is commission off of collection. Granted you don’t have a collection issue.
- Help me bro.
I’ve never understood paying off of collections due to the admin burden and risk of inaccuracy.
How do you track collections for each doctor?
Wouldn’t that be admin intensive as a staff member with likely no college degree is applying money coming back into the practice from insurance companies (sometimes 3-6mo later) to the appropriate doctor?
If their tracking is off, doctors get paid wrong, and getting paid for what you do is a hot button for anyone. So accuracy needs to be 99%.
Other doctor with Associates:
“So this is why we allow 90 days of AR to build up before we switch them over. You can track collection in the software against each provider code, so collection is just business as usual. Once it’s set up in the software, it will handle that. My vote is net production, but in this case, using a % based off of last year’s write off can be less than 99% in either direction. 9 ways to skin a cat, this is just what I’ve seen done in some of the practices I’ve analyzed. Thanks guys!”
“It’s just as he described. The biggest issue is auditing it and which is easier to get right. It’s easy to verify daily that you did something and it is assigned to the right provider. It’s hard to verify if the correct sequence of buttons is pushed to put different payments correctly to several different providers months after something is done. We have 3 docs and 5 hygienists. Say I saw a patient for an exam and my hyg saw a patient for a cleaning then a week later my associate for a filling. Say the total adjusted production for this was $500. Now assume we collect 99-100% of this. If we pay on an accurate adjusted production whether the collections that come in later are divided amongst those three different providers and two different dates accurately doesn’t matter–not that we don’t try to but it’s not imperative. We have spent a ton of time and a lot of grey hairs figuring out discrepancies with historical collections–this wouldn’t have been necessary if we were paying on adjusted production.
- What is your reservation about setting up a different fee schedule for each plan?
It’s easy to set up and, since insurances rarely raise their fees, it’s not something you’d be changing frequently. Once your staff enters payments into ledgers, payment schedules get updated and Dentrix “learns” how to estimate patient co-payments better.”
The benefits of having a different fee schedule for each plan are as follows:
- You can pay your providers accurately
- You can estimate patients’ out of pocket expense accurately
- You know how much money you are making
- If you take PPOs, patient ledgers can reflect PPO fees, while claims go out with your regular fees
- You can show patients how much money they are saving using their PPO in your office
- It’s easy to track your utilization and write offs for every PPO so that you could make good business decisions.
There is no downside, and, did I mention it’s easy to setup and maintain? It’s a lot less work than constantly posting adjustments. If your front office person convinced you that it’s too much work to set it up, get her some Dentrix training.
Any discrepancies are entered as PPO adjustments – either positive or negative and deducted or added to the current month.
- We pay an hourly rate to our associate, then at the end of the month we calculate 30% of net production from the month PRIOR, once all adjustments have been made. We then subtract the last two pay periods from the 30% and pay it out as a bonus. In the end, it still nets out to 30%.
- We do hourly then quarterly adjustments based on collections. There’s very few errors in payment entry to the correct provider. The errors are if the treating provider incorrectly posts the completed procedure with a different provider.
- I think an associate should be paid on net production. The associate has no control of collection procedures, what training is performed, or who is hired for those positions. The owner of the practice should have enough confidence in his/her systems and employees to pay on net production. The owner should take the risk on collections not the associate.
- If you use Eaglesoft and aren’t aware of the existence of “unassigned credits” and what that really means or how running a collection report/day sheet for “end of days” vs “end of dates” gives you different numbers….paying collections may be an issue for you.
There may be many ways to accomplish a task but it’s nice to have a designated place where you can go to discuss those many ways. When asked about how dentists calculate paying associates using adjusted production in real time DSN members came together for a discussion about why they don’t think it’s a good idea and, for those who use this method, how they manage their associates pay.
Being able to discuss a topic and receive feedback is an awesome way to gain reassurance on your thought process or get insight on how to do a task better.
If you’re looking for more actionable information like this, join DSN!