Data shows orthodontic treatment still in high demand nationwide
When the pandemic began this spring, dentists of all specialties temporarily shut down for all but emergency appointments, bringing production to a halt. Almost all have reopened, yet reports state that millions of Americans are still delaying dental appointments due to coronavirus concerns. According to the American Dental Association (ADA), while 99% of dentists have reopened, the number of patients visiting offices remains about 20% below usual levels.
This does not seem to be the case for orthodontics. According to data pulled from Gaidge, an orthodontic practice management platform, CWA orthodontic practices seem to be surpassing 2019 benchmarks on telling metrics such as production, collections and starts.
In an informal sample of approximately 140 orthodontic practices around the U.S., comparing practice metrics from June through September 2019 to the same 2020 timeframe, the result was encouraging.
YEAR OVER YEAR AVERAGE FOR ORTHODONTIC PRACTICES
June to September 2020 compared to same timeframe in 2019.
Production: +24.3%
Collections: +11.8%
Starts: + 21.6%
Compare more orthodontic metrics by downloading the Orthodontic Practice Comparison Report.
In addition, conversion is up from 63% in 2019 to 69.2% in 2020. Percentage of paid-in-full is up from 16.8% to 21% in 2020. Same day start percentage is up from 13.1% to 22.5% in 2020.
This data is consistent with what our advisors have been hearing from most of their orthodontic clients. Doctors are observing that when today’s patient comes in the office, they want to put more money down, pay more in full and start the same day so they don’t have to come back. This increased demand offers orthodontists an opportunity they may not have had yet in 2020.
MINOR CHANGES TO INCREASE YOUR BOTTOM LINE
Consider a slight increase in fees. While patients may have more access to disposable income, it’s a perfect time to reevaluate annual fee increases.
The ADA estimates that the average dentist is spending an extra $15 to $20 per patient on protective equipment and other measures related to COVID-19 prevention. Rather than absorbing these costs, they could be passed along to the patients to help the practice maintain profitability.
Ensure you are working to get your contracts receivable balance back up to pre-COVID levels by year end. During the 6-10-week COVID shutdown, many orthodontic practices continued to collect from patients while not starting new cases. The result of this phenomenon was a decrease of around 10% in contracts receivable balance for the average CWA practice. Increasing this balance back to pre-COVID levels will help ensure collections remain strong going forward.
Another thing to keep a watch on is the depth of your observation pool. If recent patient starts are primarily coming from this bucket, or adversely the quick-to-convert new patients mentioned above, this prospect pool may start to dwindle if not proactively refilled.
This could lead to a slow down once this group is depleted. Now is a perfect time to restart marketing, especially if it was pulled back during the spring. Leverage digital strategies to reach current and prospective patients virtually.
With this year’s current volatility and next year’s uncertainty, doctors who are experiencing this burst of activity need to take these steps to capitalize on it, rather than sit back and enjoy the ride.
Our advisors understand the nuances of orthodontic practice ownership and can help you feel confident in your decisions during times of uncertainty.
