How Much Production Are You Losing to Write Offs?

Let’s say your practice bills out $5,000 of production today. How much of that production would you expect to collect? There are typically differences between what is produced and collected, and the reasons for the differences can be found in write offs (also known as adjustments).

Keeping a pulse on your practice includes understanding why you do not receive the full amount of what you produce. Most write offs are production related and caused by PPO discounts, staff and family services provided at no charge, cash and senior discounts, redo of work, and uncollectable accounts.

Money

When you review your write offs, keeping asking why. Start with understanding why the write offs were taken in the first place. This is especially important when your write off codes are not very descriptive and/or you have a catch all codes such as courtesy discount. Are appropriate procedures being followed when giving the write offs? Sometimes courtesy discounts can be driven by an over-lenient dentist who is unsure how to handle conversations about cost. This is usually resolved by having the dentist and team redirect questions about cost to the front team.

Understanding why write offs are trending a certain way is also important. For example, if your write offs for redoing work have increased, are you having issues with your lab that need resolving? If bad debt write off is higher than you would expect, what can you do differently to collect out-of-pocket costs at the time of service?

billed

Finally, if your practice accepts PPO plans, it’s good to understand why you have so many PPO write offs. You may need all or most of the PPO plans in order to remain competitive, or you may find after reviewing write offs and other metrics that it’s in the best interests of the practice to remove some of the plans.

You can learn a lot about your practice by regularly reviewing write offs. Instead of just giving dentistry away, strive to reduce writes offs so you can collect more of what you produce.

Comments (1)

  1. Eric says:

    I think this is a popular hot topic. However, most of the time it simply comes down to whether a dentist is contracted with a PPO plan or not.

    Being contracted or not is the major difference in my opinion.

    From there all write offs are treated a certain way.

    So basically for me, being contracted generates a lot of write offs, which in turn causes at times a lot of unwanted / un-needed panic . At the end of the day, my write offs are a lot but correct.

    It does however make it difficult to “sift through” the pile to figure out legitimate inefficiencies.

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