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1368 Cash Flow Strategies with David Wiener : Dentistry Uncensored with Howard Farran

1368 Cash Flow Strategies with David Wiener : Dentistry Uncensored with Howard Farran

3/4/2020 3:00:00 AM   |   Comments: 0   |   Views: 103
David Wiener (aka Mr. Cash Flow), CEO of Cash Flow Strategies, Inc.,  is an internationally recognized authority on Accounts Receivable management and cash flow optimization.  He is a sought-after speaker on topics surrounding optimization of Accounts Receivable and Collections, Medical and Dental Practice Management, Insurance Claim Resolution and Leadership. David has over 30 years experience in medical and dental practice management and consulting, practice management software, Accounts Receivable management, cash flow optimization, medical billing and collections, EMR and staff efficiency.
VIDEO - DUwHF #1368 - David Wiener

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Howard: it is a huge honor today to be sitting in the podcast area with David Wiener and my son Ryan is here podcasting they say hi Ryan hey he's by the camera you got to get in front of the camera right somehow come on over here Ryan right Ryan started the show for daddy when he finished college yeah was home for a week thanks buddy what yeah he was home for a week and now he saw me struggling on my podcast he said dad you're not very sharp in the head and let me help you and so he did how many did you do right in the first or he did a thousand shows and then he let me down like I couldn't believe it he left me for some gorgeous girl I mean I never saw that coming when he was growing up I never thought somebody's gonna leave me for a gorgeous woman and he made me a grand kid named Jasper and it's all mine he gave it to me and but I let him raise I let him pretend that it's his kid but hey we're here with David Weiner and it's kind of a an ironic show because he's the CEO of cash flow strategies and I don't have one to listener day that even knows what cash flow is that their accountant only gives them a P&L and it's only made for a third-party IRS tax collector they they only get a balance sheet when they're gonna get a loan or divorce and a statement of cash flow I've never walked into a dental office and the dentist could show me that he's had a statement in cash 

David Wiener: because they don't know what cash flow is

Howard: that's why I have a job yeah yeah but I feel sorry for your job because I know my homies they they want to learn how to do a better root canal they want to know how to bone graft they they they don't even they don't even know that they should know about cash flow so David Wiener known as mr. cash flow is the founder and CEO of cash flow strategies inc and is a fellow of american college of healthcare trustees David has recognized authority in improving cash flow and has been cited locally and nationally in print radio and television David has been involved in the business medicine and dentistry for almost 35 years a former practice administrator CEO of a medical billing company trainer and practice management consultant David understands the difficulties of managing the cash flow of medical and dental practices and facility he conducts webinars and speaks regularly across the country at cpa conferences business seminars dental conferences he addresses the changing world of business cash flow regulatory compliance medical and dental receivables and how practice can adapt to new realities when protecting their cash flow and bottom line profits beginning with dental practices and facilities the idea for cash flow strategies grew out of a passion for helping business people understand the changing times and maximize their cash flow and profits it is his passion and a true labor of love so this is gonna be a great show so I just want to say to the kids real quick that well cash flow means is so when you look at bankruptcies when you look at personal bankruptcy the United States you know forty to sixty thousand Emer a year or four for health care when you look at business businesses that the top reasons of what hmm I believe our banker position from getting my MBA at ASU the number one reason for going bankruptcy was cashflow and what that means is let's say you have a business where all your bills cost you $1 a month and you do this job and it's very successful and they paid you a dollar but they're not gonna give it to you for 90 days so now you need three dollars in your savings account you need to pay January February and March cuz you're gonna get this money at the end of 90 days but you don't have three dollars in your savings account so you're a profitable business on paper on your P&L everything's fine but you went bankrupt because you ran out of cash and now we're seeing this in China massively because as they've quarantine cities and they're nobody's one of the restaurant they think after the first 60 days one-third of all the businesses will be bankrupt whether they're they were interviewing and in Bloomberg on someone who I was a big car lot that's selling really nice luxury cars but they don't have this savings account to pay all their bills for two months waiting for this business to pop back up and then the number two reason is the after cashflow was the Mack trucks in demand the Mack truck syndrome is um every single person on your team has to be able to ram be ran over and killed by a Mack truck so what happens you'll see a lot of businesses that have like 25 employees or less they do a million dollars a year everything's fine but you have five guys in the back welding parts for say a baler for a tractor and you got the owner and you got everybody's in fine but the whole but you got one sells guy you got one guy in a three-piece suit and tie who knows the business been in at 20 30 years and sells a million dollars worth a year and he gets ran over by a Mack truck so then you hire Anthony and Anthony Weaner I'm playing today and this is the Twitter name yeah so you have Carlos danger is he your brother or your cousin no relation no relation okay right and so you are so you hire Carlos dangers and he is a great guy and he does like seven hundred and fifty thousand his first year which he knocks at the ballpark but you had to do eight hundred thousand to pay the bills so again you went bankrupt so that's why in my office I've always had a associate Dennis so that it's you know something wrong with one dentistry on shutdown I here at dental town I don't have one programmer have five and and you know you always want redundancy I don't have one bookkeeper Stacey I have a backup so I've um and then the greatest companies the founder like Ray Kroc can die and McDonald's doesn't blink they still get up and make a - I'll be patties special sauce cheese less and I'm gonna suck ceed button that sounds really good right can you go ready yeah that's some big macs so so thank you so much for coming my pleasure office so what made you want to teach people about cash flow nobody wants to know about cash flow

David Wiener:  they don't want to know about it they just want to have it oh yeah so it came out of a consulting business that I was doing consulting practice I started hearing from my doctors and dentists you know I'm working as hard as I can work I'm seeing as many patients as I can see I'm not making money anymore what do I do when I dug in a little bit to that and started looking at what was really going on it wasn't a matter of revenue their revenue was okay it was a matter of cashflow so productive dental practice medical practice but couldn't make payroll they couldn't pay their bills and so I started to dive in a little bit to where are the areas that actually get them stuck and I knew a lot of people I I work with a lot of people who consult with medical and dental practices so for awhile I would just say well here's here's a problem that I see you have why don't you call so-and-so and they can help you here's another thing called this person I knew a lot of people who did a lot of things the next time I would meet with the doctor I would say so did you call these people I told you about and they'd say well no I mean I tried but I never got a hold of them and then they continued to complain about not having any money so after a while of that I thought you know what they actually talked to me so why don't I just become all of these people so I took a couple of years and I started vetting some of the best companies in the country that provide those services and wound up affiliating myself with probably eight or nine of them so that now I can walk into a practice in 30 to 40 minutes of just talking with the doctor and the the office manager I can see where they're sticking points are but then I can also help them get the services they need to approve their cash flow

Howard: which is what a businessman should be a conductor I mean I I have my back you said have your back to the customers and if you need a drummer well you don't have time to go out learn the drums because you're gonna need a bass guitar and electric guitar clarinet and a piano so you're a conductor so you can you have all the instruments available and I 

David Wiener: I can work as straight yeah just like as we work with ten specialists you know there's ten specialties dentistry you're not gonna do all that so I and the idea is you do what you do best eating fixing teeth oh and and let me work with you and and take care of all the rest of the things for you so that I I'm a big believer in Business Process Outsourcing you know if it's not your specialty area it's not what you're really good at there's probably a way that you can get it done better cheaper faster there's a lot of hesitation for people to go outside they they they trust what they what they've always done so let's cert 

Howard: first what would generates the phone call what why would a dentist be calling you what made him call you

David Wiener:  in the first place either they read an article that I wrote or they hear me speak somewhere or they get referrals from them what's the problem though oh just they're not sure what their cash flows like they're not they're not making the kind of money that they want to be making so they just feel like I'm working really hard I am yeah and I don't my consultations don't cost anything so you know that's always a big issue okay and how do they get a free consultation they just give me a call or shoot me a message on my email well what is it I mean you gonna give it out right now yeah they can call me Mike my toll-free number anywhere in the country is eight eight eight seven eight oh one three three three okay say that again eight eight eight seven eight zero okay seven eight zero seven eight zero one three three three that'll get right to me I'll get right to you or they can go on my website cash flow strategies dot us and there's a response form I get these messages all the time give me a call I'd like to talk okay that's all it really takes and and I and they can then at eight they can text you on that 888 no they can call then call if they want a text they can call seven seven they can text to seven seven zero three six seven 8:09 one 

Howard: Ryan you know what you're my favorite son out of all four because Ryan if you call him he answers the phone the other three boys denied the call event acts up SUV so Ryan wait why is that so that's really it just is a behavior and that's another thing that we notice on website conversions that you know the average dental website a hundred people up to land before three convert and call but you put that little text book up which I think it just be stupid and annoying but that doesn't matter I'm not gonna project myself on the market but it doubles another three percent will start doing that little text box and the ones who know it the most who or who advertise the most or orthodontist because their average new patient is sixty five hundred where a dentist is gonna be a fraction and in fact a dentist won't capture the money from a what orthodontist does it takes five years orthotics capture in two years for the treatment 

David Wiener: part of the problems an orthodontist has is almost every patient is on a payment plan and when a patient is on a payment plan very often they will make a few payments and then stop so what we need is a better way to make sure they get paid and there's a number of different ways of doing that but and it kind of depends on the individual orthodontist and the direction he wants to go in but we can do guaranteed payment plans we can do reminder service we can do all kinds of different things that help them collect on that and dental practices have a - but a lot of the dental practices hesitate to do payment plans because they're really really tough to manage on your own 

Howard: that is why I was I'm really excited about yesterday Intuit to acquire Credit Karma because my my theme if I've had any theme on my public speaking in dentistry it was all the way back to beginning with the 30-day dental MBA because all my friends I was crushing and all my friends didn't even know if they are crushing on because they had all their information in there dendrix computer and then all their accounting in QuickBooks and here it is 32 years later and now we have one dental software open dental that's open so any of your programmers can just program to it and quicken is finally become a stupid and they've gone from a baby consumer you know something something  that um you know for the individual to now a serious small business operation oh yeah and now that they're buying a care stack for seven billion so my dream and because like on a patient payment plan like my homies there'll Erin open dental they were gonna extend David Wiener deal they would say okay well you can make payments of this but they don't have the sophistication to run a banking check or a credit check and to sit there and say no in fact this would be you know not a wise decision so I think five or ten years from now a lot of these problems you're dealing with today may be solved by a better infrastructure 

David Wiener: could be it's still if you're if you're managing a payment plan all on your own you still have to wonder what do I do when the patient stops paying because they do and they do often there are services out there that can can white-label a payment plan for the practice and guarantee that you receive every payment okay so I'm gonna I'm gonna start going over 

Howard: some of your posts I had a big fan of your posts on dental town thank you much for sharing so a guy puts in accounts receivable says I am a small office owner with need for a collection agency in Michigan with my research including discussion buh-buh-buh-buh and then you reply trans trans world system seeing TSI is the largest collector of dental debt in the US and is the preferred vendor for the Michigan Dental Association they can start as early as 30 days and do outsource fall so let's start with the accounts receivables what would account receivables have to do with cash flow

David Wiener:  well everything the AR is probably the largest asset that doctor owns more than this house or is dental practice Wow yeah and and in a lot of cases I can't tell you the phrases that I hear over and over again are boy they never teach you that in dental school I probably hear that which is lame or sometimes 

Howard: which is lame because they're not gonna teach it in plumbing school like you know you go you go to Welding school you go learn how to drive a semi truck excuse me we're gonna stop welding right now

David Wiener:  they're not accounting what they need to learn to be a dentist and what they don't teach is how to run a dental practice which I think everybody comes out of dental school assuming that they can figure that out and they don't so the accounts receivable is huge and if your accounts receivable the older and accounts receivable gets the faster it depreciates I would in fact quote a study by the US Commerce Department all the time to my clients if you wait six months to collect today it's less than 30 percent collectible and and people say well I don't know why my collection agency isn't doing a good job I send stuff to them at 120 days 180 days that's one of the reasons right there and so we can look at their accounts receivable take care of the payment plans for them and and also get them into a process where they don't realize every time you send out a statement a letter a phone call candy flowers whatever you're doing to a patient who owes you money it costs the practice between ten and twelve dollars every single contact doesn't generate a statement to generate a statement letter phone call whatever labor so if somebody is four five months out and your balance is for a general and cosmetic dentist aren't that high for patients you've probably spent the value of the account at least your at margin it doesn't make sense so there are ways to collect faster better cheaper without tying up your staff and which is illegal by the way I've found out what's that tying up here did you try it yeah turned out that that is indeed illegal

Howard: but I know I want to beat this in the ground my homies because I'm number number one you you're there they come in your office they're in pain they went out of your pain and you're gonna do a root canal and you're gonna go through all the time and labor a billing the insurance companies which is about 30% of the US healthcare cost because Delta can't automate it on an app and you have to have a human called them and you know they just can't do anything that should be obvious and and then you say to that patient okay now your portion is 300 how would you like to pay for that today well he's the most motivator right now I'm in pain I'm missing work you're gonna this is a thousand dollar procedure and you're gonna do a lot of work to help to get the insurance paid which is to benefit that my employer paid for your portion that do today and he says I just send me a bill what I mean you can't do that at a mall you can't do that at a restaurant you can't do that anywhere so you got a McDonald's you order a hamburger you pay three bucks and then you get the hamburger and the person doing it 16 then I go to your office you're 26 i order a hamburger you give me the hamburger I eat it and as I'm walking out the door you say hey I'll send you a bill and so now look at this so now it gets even worse so you have three fingers you have two of the fingers or overhead the ad a shows every year great studies that average overhead a 65% so you make a third percent yourself so you don't collect this guy's three dollars that means that to get your three dollars that's gonna be the profit from the next two patients that come in they give you a dollar so not only when you don't collect on that so so your collection policy in my opinion is the number highest effect on overhead well it be that or labor you know some people have like high labor but they collect all their money and they have good cash flow and they make 250-year but man when you have high labor and then a over 30-60-90 the overheads to the roof a

David Wiener:  couple of the things that I speak about when I speak around the country to to medical practices dental practices and organizations two of the most requested things that I talk about as a part of my talk are how to build an effective compliant financial policy and we go through a little workout of words what would say it again how to build an effective compliant patient financial policy you hand somebody a document when they first initial policy so patient comes in new patient you hand them a form they're supposed to read it understand it and sign it even if they do well most of them don't read it but even if they do you're expected to enforce it I find so many practices that are using patient financial policy forms that either they  took from somebody and they don't understand it or it's the same one they've been using for the last 20 years it's not compliant with the law anymore it's totally non effective and they don't enforce it anyway and to be honest the person who is the biggest culprit in not enforcing the financial policy is the doctor because dentists are softies and that guy comes in in pain and a lot of the doctors will say to them don't worry about how you're gonna pay for it will take well we'll make sure that you that's why I know and 

Howard: that's why I love them they ever I remember we were matched on that charity dentistry missionary Dentistry thing and we were we kept talking about how isn't dentistry so cool because the dental students were just so I mean they're cool yeah and they're very different than some other professions I don't want to mention my name because in my lawyer you're gonna give me ventia but it dentistry health care physicians dentists are entirely different breed and the people attracted a lot law 

David Wiener: I believe and that's why I love to work with them yeah I've worked with doctors my entire life my father was a CPA who only worked for medical and dental groups I've been around him I I speak doctor I knew who is more boring a dentist or a CPA you know what I had found neither neither are boring neither are boring I've had the opportunity to speak at the annual meeting of the Academy of Dental CPAs a couple of times out in San Diego and in Kansas City and yeah my first thought was this is gonna be fun what an incredible group of people all CPAs all deal with dental practices in a large way tremendous people and I won't hang out with doctors anyway so

Howard; so I'm things I want to tell you I'm one of the biases that I'm Dennis have is them if you're really really smart cuz cuz Dennis are used to their whole grammar skills are horizontal now smart they are is farther because they're crushed in in geometry and trig and algebra and calculus and Newton and all that stuff so you're one of your biggest clinical heroes pelo Melo who we had on this show who invented the all on four and was a gazillionaire I mean he's probably the richest dentist that never came out of Portugal possibly Europe and but he decided on these expensive treatments that he was gonna start carrying the paper so what happened to him he got up to seven point four million dollars in debt and and the newspaper post lista eighty-eight creditors claiming around ninety four million euros and he behaved there is there's his clinic bankrupt and that was I mean so you can be the smartest surgeon the smartest guy in implants and vent the all on four and be the richest guy in the block but he didn't understand extending credit the bhisma now now he thing he basically and his mind said what what is this Chase Bank Bank of America I'm I'm a dentist I mean what what could chase know that a dentist doesn't know could they know anything I I think maybe they do and maybe it's a sovereign profession so this trans world so on account receivables you said they so so first of all Trans World Airlines is when our trans world airlines I'm taking a TWA so so talk about this on what is the Transport Systems trans world system with so how is a as a largest um you said is the largest collector of dental debt in the u.s. I did not know that so tell us more about that well they don't advertise but 

David Wiener: back in 1970 a couple of guys who were looking to start a collection agency realize that by law the first contact that a collection agency has to make with the debtor is by mail okay its federal regulation and the scammers always think that they're calling you on the phone and well they do do that too but they said you know if we know we have to use the mail and we know that our costs are fixed why do we have to charge them a percentage of what they of what we collect why couldn't we just charge them a simple fixed fee it'll be cheaper for our clients everybody's happy we're not sure it'll work but let's give it a shot and they invented the concept of fixed fee collections back in in 1976 fee collections right so typically when a dental practice works on account for as long as they can possibly work it in-house wastes all their money chasing the money and they throw their hands up in the air and they say you know what we're just not gonna get this often they will turn to a traditional percentage-based collection agency and turn over the debt and if that money's collected they wind up paying 30% 40% 50% of well you've already spent a lot of money chasing it yourself the kind of the dirty little secret of collections is that eighty-five to ninety percent of the money that's collected by a collection agency in the United States is collected on the very first contact because there's a group of people pretty good-sized group of people who are simply waiting to make sure you're serious about collecting the money and once they hear from a third party you know that they're third parties involved they'll pay it so these guys decided to invent the concept of fixed fee collections so you pay a fixed fee to turn an account over that average is now around twelve dollars no matter what your balance is for general systems right they utilize the mail at first maybe some phone calls if the money's collected you keep a hundred percent of it way less expensive they're also far more efficient and effective than than any other collection agency in the United States now they don't just do medical and dental but that's the world that I live in so I'm more familiar with that they're the preferred vendor for a whole slew I know where I live in Georgia they're the preferred vendor for the Georgia Dental Association like you said I mentioned to someone that they're the preferred vendor for the Michigan Dental Association and there's a whole bunch more state dental associations that have chosen them as the preferred vendor they are also the preferred vendor for the American Association of oral and maxillofacial surgeons and I've been very a lot of work with a mouse on you I do a lot of work with a Mohs so what's order oral surgeons are they doing the pelo Melo 

Howard: are they financing the big implant cases or is this their

David Wiener:  I mean they're they're billing you know a lot of them have to file both medical and dental insurance which takes forever Transworld systems also offers a service to speed up slow pay insurance claims for a fixed fee that averages like 12 bucks nobody's gonna pay a collection agency 30% to speed up a dental claim but if if the collection if the insurance company is not responding to you you can actually turn the insurance company over to the collection agency for that fixed fee and they have a whole separate service where they'll contact them on a number of times and speed up that claim for you now it may result in a denial but that's okay if you if you get a denial then you know it's patient responsibility and you can go from there since the time that Transworld systems was founded they've also added a layer of first party follow-up and so we can actually start we transport can start the day the EOB clears get explained TLB to my homies the explanation of benefits that comes from the insurance company if there's a patient balance left over typically most of my clients that are using Transworld systems they'll send one statement after the explanation of benefits comes just to establish the patient responsibility thirty days later they start with with Transworld systems for a fixed fee they can do the first party follow-up the pre collections and full collections yeah 

Howard: so many things we can talk about this some thanks for coming in and doing this um so when you have cash flow problems the first thing that we start talking about was accounts receivables and we talked about it's it's coming back it's funny how you look at progress it's always two steps forward one step back and always I thought this dog was slayed thirty years ago about carrying your own paper and now it's making a comeback and what do I see the similarities well when the markets all going up I mean from 94 to 2000 what percent of your friends thought they were a genius stock picker everybody yeah everybody and then March of 2000 they all realized maybe I should do root canals really and and now and this bull markets been going along he's been going a decade and in the last couple years you start seeing these things and and Aran's is plenty this morning barons had an article on it also correlates the amount of ponzi schemes so right now the FBI is tracking like 30 major Ponzi schemes and they they always pop up at the tops of the market because you're so what did Greenspan call it the euphoria irrational exuberance you're so irrationally exuberant optimistic that you can't just smell baloney and say that's a Ponzi scheme so everybody kind of gets caught up in the excitement and I think that Corona buyers might be thrown a little water on this so I think so the end of the tenure yesterday anyway yeah dropped a thousand yesterday but again I think that it's become sad to cash flow so so give them some metrics what is a healthy cash so like I'm on account receivables if your dental office produces and collects a dollar a month twelve dollars a year what would be a healthy amount of over 30 60 90 120 and due to the corona virus in China where they're shut down for a month and don't have any savings what should be the healthy cash flow savings

David Wiener:  well looking at somebody's cat their accounts receivable when I was doing traditional consulting with the dental practices and I don't do any clinical I just do the business end of the practice but I would look at their aging report and if they were reducing 50% between buckets so 60 days is 50% less than 30 days 90 days is 50% less than 60 days and they were doing it on their own they're doing a pretty good job so Ryan what's the formula for that reducing your receivables 50% every month going forward yeah I mean that wouldn't be a fractal what would that be an algebra you can work on that I'm just journey to be a problem when I was first introduced to Transworld systems about 12 years ago I'm looking at their percentages saying okay in dentistry alone in the first 30 days that they have the account if the account comes to them at 30 days in the first 30 days they're seeing over 82 percent of them collected depending on the specialty in the next 60 days they're seeing between 40 and 55 percent of what's left collected that's before anything has to go to full collections which is exactly what you want you want it done while you still have a relationship with the patient that can be salvaged you know you're not you're not dismissing the patient at this point but you're getting your money within the first 90 days which is crucial so I look more at not as necessarily what's a healthy cash flow or what's what's a healthy collection percentage I look at where you are now and how do we improve it and can we consistently improve it year to year 

Howard: so a lot of people wonder if I'm really really busy and I'm not making any money is my girl up front surely stealing money in some cases yeah is that what would it what would be more likely a bad collection policy theft

David Wiener:  another thing that I speak on when I speak a lot is on how to speak to patients about money you know I've heard some of the craziest things and not only like HIPAA violations you know just not good ways of saying things and there's certain ways to phrase things we're gonna be a lot more likely one not to take the patient off and to to collect more money rather than less at the time of service well it's whatever your scenarios I'm here for my hair transplant it's simple things patient cut says I can't pay all of this today often I hear them say well how much can you pay that's the wrong thing to say because what you're doing is you're giving them control back and you know what they're gonna say oh I've got ten bucks in my wallet you know so rather than saying that what you want to say is how short are you because now you're you're giving the expectation to them that you intend to collect it all you want to see you know exactly what they can pay expecting that they're gonna pay the bulk of it today or somebody says you know I I need to make payments on this if you can you don't want to say well how much can you pay a month because again you know what you're gonna hear I could send you five dollars a month and so you want to say what what I did in the practice that I helped run and and what I encourage my my clients to say is will that take you 60 or 90 days to get that paid and if they said it was it would take more than three payments or 90 days my response was I'm sorry I can't help you now we've also developed new services where you can make payment plans where you're guaranteed to receive the payments without paying a ridiculous interest rate and I'm not going to mention any names there are there are outside financing companies that charge the doctor ridiculous discount rates and interest rates on that you can actually do a guaranteed payment plan that only costs the practice 3% which is what you're gonna run it pay to run a credit card anyway and you're guaranteed to receive every payment in that case make it six months if you need to make it eight months and who's that gonna be with that's where the company called Verity Verity VAR ID i VAR i di i nee i another company that I'm affiliated with so if you want to use Verity service or you want to get a demo call me you know I'll help you get it get it taken care of as quickly as possible but they will they will allow you to set up a payment plan as your own because really a patient would much rather work with the practice on this than they would be willing to go to an outside financing company and we all know who those are and those are Care Credit you're talking about your credit and there's others 

Howard: but it is is Care Credit the I'm having a hard time putting my mind here on care critic is I mean when got my first 20-30 years she was the biggest company Jack Welsh was the biggest celebrity and they owned care credit and then they just fell off a cliff unexpected so are they the 400-pound gorilla they once were or

David Wiener:  everybody uses care credit I mean it's old it's no longer owned by GE almost almost everybody I know uses Care Credit and I have a lot of friends at Care Credit that I don't want to tick off it at this juncture but Care Credit rejects 50% of the people who apply Care Credit also charges a pretty hefty interest rate to the to the practice what is it it varies depending on the practice I've seen it as high as 11 or 12 percent they also and does that dentists is that because of that dentists or that dentist patient is I mean is it different for both I'm bad I'm not absolutely sure of I just hear there's a lot of algorithm yeah and and also you know they offer to the patient if you pay in six months or if you pay in a year it'll be interest-free I would love to see see stats on how many people actually pay during the interest-free period and and I've got to say I I use Care Credit but the way I use Care Credit is so that I don't ever have to talk with money about my doctor my dentist they put it on Care Credit I paint the next day when I'm home and sitting at my desk and so I never pay any interest and they're happy to do it but this verity service they'll guarantee acceptance for anybody under $1500 automatically if it's over if the balance is over 1500 then they're gonna have to run some credit they guarantee that you will receive all the payments even if the patient stops paying and they only charge the practice 3% crazy and we've 

Howard: so what do you think it's not a a bigger thing why do you think I'm more Dennis why does everybody know about Care Credit and not this on 

David Wiener: Care Credit has done incredible amounts of marketing there at every conference I'm ever at with a big big booth and a big display and you know they just because somebody's the biggest doesn't necessarily mean they're the best and I think there are cases where Care Credit works great for people but in my estimation this works better now I have a doctor that I work with who is a huge Care Credit fan okay good it works for you you're happy with it that's wonderful what do you do with the 50% of the patients that they don't accept and

Howard: maybe they're not experiment maybe that doctors not experiencing maybe they're in a more affluent area 

David Wiener: yes another doctor they're not actually but he started using Verity just for the cases that CareCredit doesn't accept and is very happy with it that's great I'm happy as long as they're happy and their cash flows better I'm I'm fine and so that's helped out a lot and one of the reasons one of the ways that I found out about Verity is because they're actually using Transworld systems to collect from the patients who don't pay them so not my client I wish they were but they're not but I've worked with Verity now for a few years and and that's Roger Girard I haven't dealt with Roger particularly but yeah that's the CEO but it's it's worked out great for my my clients and I think it's if nothing else it's worth looking into and they do a 20-minute web demo for anybody is interested in it and they'll show you the actual numbers and everything is 

Howard: so as someone was asking you what did you think of a treating age AR with a benefits have you heard of that company denna Fitz not familiar with it not familiar so then another thread on good book on running practices and you said highly recommend the e-myth dentist why most practices don't work and what to do about it by Michael Gerber I'm a

David Wiener:  I'm an e myth fan i I believe in what he's talking about I read the e-myth years and years and years ago and then read the e-myth revisited and I found out he's done all kinds of specialized books and so I've read the e-myth physician I've read the e-myth dentist it's just good he covers all kinds of areas of your practice and where your sticking points are and what you can do about it and and that sort of thing I'm a big fan

Howard: yeah that is a that is a hell of a book so to the kids though I fourth of my listeners are still in dental school can you succinctly describe that what the e-myth is about

David Wiener:  it's a quick read I mean it just basically breaks it into talking about people and money and patients and all kinds of different things and just kind of where where the potential traps are where the potential pitfalls are what's hanging up most practices and then how you can address it and addressing it's not always easy but at least you know what the problem is and you know so what

Howard: the way I I see that book is it's just it was so obvious um because my dad was in the restaurants he had he had Sonic tribe ins and Sonic Sonic state franchise has had a franchisee well you everybody want to know why do the franchises have like a 95% success rate and the mom-and-pop businesses 20 to 40% of restaurants they fell the first year and it just came down to it's very simple when you own a restaurant all the work that you all the hours of the day are serving the customers you're seating them taking their order cooking their food you you're doing all that you're always working in the biz but if you have a franchisee that doesn't have customers there working on the business so McDonald's had a headquarter and they're trying to figure out all the details of running a business like I remember Ray Crock I'm when he for a dozen McDonald's in a row they would go in there and just lay the slab and have the architects come in chalk everything out and then get all the employees from 10 other restaurants just come circle around this parking lot and say hey what's working and some girls say well you know every time I make a malt I turn around to put on a tray and David knocks knocks me down you know and so they're all looking at this stuff and it's all operational logistics

David Wiener:  Ray Kroc didn't didn't franchise a restaurant Ray Kroc franchised a system and it was exactly the same everywhere it was done the system they put a ton of work into the system creating it to be almost foolproof and all you do is you go in and you operate their system and it's a success and

Howard: by the way for you young generations ears who are all outraged at how and healthy the food is go back to bed I mean when we were a little kid I mean it was a big event if you had the money where your mom was seven kids could take you to McDonald translate the damn thing in the world

David Wiener:  Zoe's kitchen healthy food fresh food same thing yeah they've created a system every Zoey's you walk into across the country is gonna be identical and the food is always consistent and the system is always working because it's all spelled out before a franchisee walks in

Howard: and Southwest Airlines is the only airline where every plane is identical the same yeah and then you walk in every dental office in America every single one and except for possibly mark Kostas office who's the master of this and you go now in any opportunity any drawers the same but you go in a dental office and and a dentist is doing a filling how would you like to have be having brain surgery done on you and every 15 minutes the assistants got to run out of the room to go find something that's done on and my gosh you uh you even go in for a hygiene check hey can you do a little filler there's only a buccal pit on number 30 it shouldn't take five minutes ah no this room doesn't have a drill yeah we're a dental office we're a dental office and guess what room one doesn't have a flippin drill and a dental office I mean it's just crazy and if you go in there and make every single room a 737 and the same day treatment is the highest way to get your treatment plan acceptance rate is when I tell you got a cavity you want to do it right now I mean you're here I mean you're right here in my oh you want to do it right now that's that's the highest deal but when you say now we can't you gotta come back tomorrow cuz you're like well it'd only take five minutes well I'd have to move you to another room because this 737 doesn't have any wings and I can't put you in that room because those 737 dynamic wills and this one does outta gas and it's like dude just it's all that operates logistics so let's go back to word dentists so prevention is worth a pound of cure how do you build an effective compliant financial policy there I'll have one I can cut and paste 

David Wiener: no I do give them a sample of what I consider to be a good one I've made it as generic as possible but I will walk them through all of the elements that need to be in a financial policy and a bunch of the elements that shouldn't be in a financial policy and and we just walked through step by step where we'll work through a worksheet where I'll say okay what types of payment do you accept which credit cards you know those kinds of things they write it down which insurances are you in network with if you're in network which insurances are you out of network with you know write it down all of those become building blocks in putting together the financial policy if they want me to actually complete it for them make it look pretty and put their logo and everything on it I can do that too but they can do that themselves I see all kinds of stuff and one of the things that I find in almost every insurance policy in almost every financial policy is some kind of a statement that says the patient agrees that if they don't pay their bill they are responsible for all collection costs on the on the that is not legal Braille a that's not legal you can't put that in there also you should have a and the reason is and Tax Court or the courts have determined that if you're paying a collection agency 40 50 percent you cannot add that on top of the bill so that your collection cost is nothing first of all the math doesn't work out anyway if if I owe you a thousand dollars and you turn to turn it over to a collection agency who charges you 50 percent and so you add five hundred dollars on top of the bill and I pay it which is not likely to happen if I can't pay a thousand I'm not gonna be able to pay fifteen hundred but if I did you still give them fifty percent and all you get is seven hundred fifty bucks so the math doesn't work out but that according to the US government is usury which is charging an illegally high interest rate and you can't prove that that is the actual cost of collections now it's the cost of collections to you but that's not what they're looking for they're looking for the actual cost to collect the money you cannot add a percentage on top the only legal thing that you can do in your financial policy is to say if this account goes to collections there will be a collection fee added to the balance of X number of dollars but don't make it too high because too high is usury now how high is too high nobody knows and as and 

Howard: this has deep religious roots because the all through the Christian Europe for two thousand years they didn't like interest banking financing and it was an illegal trade for the most part and then Islam came along in a big way where they just spelled it out they don't interest banking so it's always it's always been kind of a I like like drug dealing or prostitution or banking has the first two thousand years of banking was kind of like in the alley you know what I mean yep it was not a it was not a noble profession 

David Wiener: well who was the most hated person in the Bible was the tax collector right so same idea you know because they were always skimming off the top and taking extra money and that sort of thing 

Howard: so geez knocking over the money changers and those those guys and and those are in every airport because the money changers were the what do you call that the the currency what what's a currency exchange yeah currency exchange I mean people are coming in from all over Egypt and the Mediterranean Basin and and they didn't like that so so your dental services you do we've been talking a lot about a patient account receivable management you do merchant funding you do insurance 

David Wiener: well I'll tell you one of the other big ones what I look at first are their biggest assets so we start with the accounts receivable second thing for a lot of dentists and when they

Howard: but when they call you and their biggest concerns account receivable how big is the problem I mean is it one month two months three months what

David Wiener:  I've seen from minor little tweaks that are necessary all the way up to Katie bar the door the place is burning down you know and what does that usually mean like three months AR or five six months four or five or six yeah it's it can get crazy before somebody actually realizes I sit down with the office manager and the doctor when we first start and I ask them to print a copy of their aging report in the vast majority of cases the doctor has never seen the aging report or hasn't seen it in eight a long long time I know you just got back from a Chicago Midwinter Meeting and he ran 30 red lights because they have a new laser they're selling for a hundred and fifty thousand dollars it does that's what someone you know so my point is I'm gonna see where the pain is and I'm gonna point it out so that so that everybody realizes okay this is an issue we need to address and I can generally tell by looking at the aging and and would you and

Howard: I want to get your feedback on this because because you've been looking at this industry for 30,000 feet for 30 years you're almost ah you must be an old man I'm older than you oh my god are you I'm just well at least you're alive but um a lot of my friends that are well run business with a big account or CEO problems are in the state of Illinois who is sometimes takes a year to pay on dental yeah I mean and and it's kind of um it's kind of bizarre cuz you know being talking about HIPAA and usury fees so so they make all these laws about usury they make all these laws about HIPAA and OSHA and all this stuff and then when the health care systems broke they're out there on the political stands blaming it on doctors of course and the solution is gonna come from the government that broke it there yeah after we broke it for 50 years it's time that we just take it over because you're so broken I mean does that does that I know that it's a that's a political hot dog question but is that the way you see it or careful with the hot dog stuff with the last name Weiner oh sorry Mr. wanker Mr. wanker so so does that sound kind of absurd that is absurd I mean what would what do you think of Medicare for all then

David Wiener:  opposed to it with every atom in my body and so it's so and

Howard: I love the fact that the young dentists and dental schools are passion like well this is a really good thing because their hearts in the right but I know their hearts in the right place you chose to be a dentist you chose to work with your hands doing surgery on people in pain you're you're a good person 

David Wiener: I'm not crazy about Medicare you're not you're not a good economist Medicare is coming for me shortly I'm not I'm not real happy about Medicare for me let alone Medicare for all if you look through the history of this country the government's not real good at running things they're good at killing people they killed six percent of the popular last 5,000 but they're not real good at running things and and I I think we need to do some work in health care we need to get those things taken care of turning it over lock stock and barrel to them and making a single provider system is crazier than most of the stuff I deal with every year 

Howard: yeah my focus is um when you have grandchildren grandchildren yeah I do how many five six Wow my god is your wife's name fertile murder season well I

David Wiener:  I am remarried my first wife passed away so I have four natural grandchildren and two step grandchildren who are my grandkids anyway you know what I call that III I used to when I was a young new grandfather I was used to always thought I should be explaining this a choice and I thought screw it's Modern Family grandkids coming on I don't know how some of them are even my grandkids but they're my grandkids if they call you grandpa oh yeah it's your grandkid yeah it doesn't matter what you think but I think too one big area that I address with doctors is their second biggest asset is often their building if they own their own building there are ways to save on their taxes people people gloss by that and say that I do cost segregation and they don't really know what that means basically what we can do is help them defer large portions of their taxes through their building and it's funny because a cost segregation study I don't know how familiar you are with the with my nose

Howard: I know my homies don't know so so you'll make it real simple 

David Wiener: you referred to the Big Mac as two all-beef patties special sauce lettuce cheese pickles onions on a sesame and Pagano we we're be lying our age remembering that commercial but that's a good way to look at it when when somebody buys or builds a building there's two ways of handling it one is as a Big Mac which means that building or even leasehold improvements are depreciated 39 years straight line it's the easiest way to do it and most CPAs do it that way so let's say you have a which is cash versus a curl that's another thing they get hung up on you yeah you can depreciate 139th of that building every year and take it as a tax deduction which is great but the IRS says you don't have to do it that way by using an engineering based cost segregation study we turn that Big Mac into two all-beef patties special sauce lettuce cheese pickles onions on a sesame-seed bun and a lot of those everything non-structural in the building can be depreciated at five seven and fifteen years well thanks to the 2017 tax cuts a Jobs Act at least for the next couple of years all of that five seven and fifteen year property can be depreciated 100% the first year well you speed up your depreciation so now for some of the property you're taking one-fifth of it every year so you get a much bigger tax deduction if you take that all of that what we call bonus depreciation take all of that stuff the first year you get an incredibly large tax deduction and and some people have said to me yeah but I'm gonna get it over the next thirty nine years anyway well if I'm gonna give you a million dollars do you want me to give it to you in 39 chunks over the next 39 years or do you want me to give it all to you today

Howard: and here's what I want the young kids to realize when you're in dental school when you're a grandma what you will realize that the United States has 1 million physicians and it has 1 million attorneys and the 1 million attorneys come up with all this cockamamie where the 10 US tax code is 60,000 pages in the best tax attorney in Phoenix Arizona that I use no one's ever read that entire code and this is the endless that we have to put up with and that one trillion dollar cost is how much you run short every year so you're 19 trillion dollar deficit you're coming up about a trillion dollar short year it's not only all with your 1 million attorneys they're the ones that grind the Wills of the economy down to when I got out of high school to today you've only grown this economy about two and a half three percent for 40 years and you shipped out 50 million jobs where they can avoid all this all this OSHA all this HIPAA all this everything and I don't I personally do not think you will learn the lesson I personally think just like Portugal handed it over to Spain Spain handed the Empire over to England England has the United States and you are just delivering it to China on on golden chariots because it's that that's that's just what you'll do you you won't fix the problem so my question to you is I mean when you're dealing with dentists and physicians is that usually the same beast or they are they are their nuances are they a different animal

David Wiener:  it it's very similar very similar I mean there are some nuances but mostly they've got the same problems the practices run very similarly that sort of thing but this this cost segregation even the CPAs don't totally understand it yeah my dad was a CPA want you to know and and

Howard: one more one more thing you know they be when you look at any political science SIL crime deal it's always about transparency I don't know I've told Ryan this before but when I was raising four boys if they ever ran into one room and shut the door you know something's going down I mean why would they all go in one room and need to shut the door Trenton to become opaque to me and their mother so the lawyers they 99 percent of all lawsuits were settled out of court well why do you think that is because what it what if I represented a church and my client raped your child and so I give you hush money and you don't want that to register but then that guy goes on and does it 40 more times do they ever go back to Boston say hey mr. attorney you've been living like a multi-millionaire while your criminal accuser keeps doing this and these boys end up killing themselves drug addicts alcoholism and the fact that the entire legal profession is 99 percent opaque shows you the that they that they are and you just go along with it and go along with it and what are they done the lawyers all your congressman what what is the number one occupation of all of Congress since day one where's lawyers so the lawyers sit there and they own that they're the politicians and and they butt up with the politicians to pass all these laws to shake down the businessman for money another one is the marriage institution I mean it started off as property rights now it's just a property shakedown they got all these laws with with the government oh you divorced well you know if you would have paid her for sex we'd put you in a cage but you guys did love but now you broke up so now give us a bunch of money and I look at so many dentists when you look at their cash flow and you look at their numbers like do they're between five six seven thousand a month alimony and it's like that is you know it's just and and then so so when young people run to the government like it's their mom to help them oh we have a problem come help us it's like no they're the problem I mean when you tell me the government is the solution you're not even smart enough to understand that they created the entire problem for the last 5,000 years 

David Wiener: yeah well so we have to be creative and come up with the ways to solve those problems ourselves you know yeah I had a I have a client who's a dentist just purchased a building to move his practice into he's been leasing and and he just bought a building and renovated it I was able to save the guy $60,000 off of his taxes this year by doing a study for him study didn't cost him close to tons my poster child not not in the medical space but I had somebody who built a warehouse large warehouse owns a chain of stores just basically to store all of his his CPA called me and said I don't know if this would be a good thing for him but can you check the numbers out and I can run a free estimate on any building for anybody to see if it's worth doing the study wound up costing this guy fifteen thousand dollars and we gave him an additional 3.2 million dollars of tax deductions this year 2.3 million dollars of tax deductions this year so

Howard: so in your in your experience I'm just wondering you know get three decades in this now dsos are coming out and they're their only advantage is that my guy the owner operated independent I he's just trying to figure out root canals fillings and crowns he can't figure out his cash flow and marketing and all these things like that do you think the DSO do you think dentistry is gonna follow Walgreens where when you and I were little every pharmacist owned their own land and building just like the dentist and now they all are employees at Walgreens or CVS are do you think um

David Wiener:  it sure does appear that way and and got a lot of friends in the DSO industry so don't want to take them off either but I am a crusader for independent practices but why though you get to make your own decisions and this all kind of started in the medical world where doctors were all selling out to the hospitals not always a good idea you know I mean you like to just practice medicine but give you an example there burnout went through the roof it's all over the New York Times and I mean oh yeah give me an example out of the medical world I had a doctor who was a client of mine we work together he came to me one day and said I'm thinking about selling to the hospital and and I said oh don't please don't you know it was so we talked and and he wound up selling to the hospital became an employee they put all kinds of quotas on him that he could not meet he was an OBGYN couldn't meet the quotas they fired him he had such a bulletproof non-compete clause he had to wind up moving out of state to go back into private practice himself it all looks rosy from the beginning but there are way is to help you manage your practice where you can still be your own businessperson you can still run your own practice you can make your own decisions do those kinds of things and not be simply somebody's employee and 

Howard: here's another outrage on that I'm when you talk about the what you're doing with the cost segregation services what do you call the cost segregation services incorporated the the problem of that is I mean look how absurd this is when it's tax time you you call the government hey it's actually much higher yeah I don't know but if you get it wrong we're gonna kidnap you and put you in a cage and put liens on all your property and and they're just like oh okay thank you mister government and it's like hopefully quicken that owns TurboTax charge and now they own now they bought out of this on new finance still I mean it would really help on cash flow is if you paid your taxes monthly because my homies they'll go get a job for a dentist and he'll Pam as an independent contractor which is in violation of all rules because an independent contractor someone like I'm building a house I know nothing about plumbing and I'm having your plumbing service come in and put all the plumbing in which I can't do myself but know you're going into a dental office using all their dental equipment doing procedures that all these other people do and and you're not but anyways but they just do it because of the FICA matching so the Social Security tax FICA matching is you know 79 percent but the employer has to match that so to save the match they say you're an independent contractor then my buddy he comes out of school he gets a paycheck every month doesn't even know and now is that CPAs telling him in March oh you need to write a check for 40 grains like 40 grand I don't have $40 yeah 

David Wiener: and they're tightening the rules down on independent contractors because basically that's what I do with a lot of these companies that I'm affiliated with I'm an independent contractor or my company is an independent contractor with them but they're really tightening down the rules and there's a lot of restrictions where the government is going to be coming down on these people who are hiring these independent contractors because you can't specify what their job duties are you can't specify the hours that they work you can't specify a lot of things or they don't qualify as an independent contractor and they're starting to catch up with some of these that are being wrongly classified as an independent contractor I'm happy to be an independent contractor because I make my own way 

Howard: but see you are independent contractors you give me your dental office you're not coming in here to do a root canal cleaning and exams but you're doing a whole nother specialty that this guy does 

David Wiener: well I'm an independent contractor with Transworld systems yeah that's my affiliation with the company I mean they understand sales but they're not telling me how to do it they're not telling me how many I have last question we got to go because I'm I know you're busy and last but not least you you posted about collection letters and and what are your any thoughts about that oh well collection letters don't really when it's when it's done in the name of the practice usually those aren't going out until very late 90 days or beyond they're not doing any good there's no leverage at that point they understand you're after their money you could you could come to their house and dance for them in there and they're not gonna pay you after they've ignored you so many times there was a study done not too long ago that over 80% of patients never open the envelope after the second one yeah because they recognize it it either gets thrown in the envelope on the desk or it gets thrown in the envelope in the trash what's necessary at some point sooner rather than later is that third party impact that you need of a collection agency because it makes a whole lot more of an impression when they get a letter from a collection agency than when they get a letter from the practice another one you know and so there are better ways to do it and you don't want to be chasing money for that long to have to start sending it I remember that post to start sending a series of collection letters and when I run into a lot of times when I'm speaking to practices and I I do it more just teasing but I say how many of you still put stickers on your bills colored stickers when stuff is past due and you wouldn't believe how many people are still doing them I tried that it doesn't work nobody's paying it's like red sticker this time who a yellow sticker this time they it doesn't motivate them to pay you in any way

Howard: so my gosh we went out 15 minutes over I this has been so informative your website cash flow strategies dot us how much is it it's a free consultation if they call you yes and there's no money exchanged between me and you no this is not a commercial nope um you're supposed to put a doughnut in the box so we will work on cherry filled donut um thank you so much for coming by absolutely my pleasure and like I say I'm trying to be a leader and you don't have to lead my homies into cosmetic dentistry or implants or Invisalign they that that they that's all they dream about the man trying to get them to think about their cash flow tough but ask me how I know I've been trying to get them to do it for 32 years but thanks for coming in and helping me sometimes I like beating my head against the wall all right 

David Wiener: thank you very much my pleasure 

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