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It’s 2019: Does Your Practice Have a Business Continuity Plan?

Last year was one of the deadliest and costliest on record in terms of natural disasters. From the deadliest wildfire in California’s history to the worst hurricane to hit the East Coast since 1969, 2018 brought more than its share of trouble to the US…and put more than one small business OUT of business.

A dental practice is, at its heart, a small business…and one doesn’t own a small business: it owns you. No matter how many staff members you may have, the buck stops with you…and the sustainability of the business is on your shoulders. That’s why a business continuity plan is crucial for every practice. Since we’re at the start of a new year, this is a great time to take a look at your plan…or create one, if you haven’t yet.

Why your practice needs a business continuity plan

Business continuity planning is a preemptive strike, a fallback course in the event disaster recovery becomes necessary. Your plan should take into account the basic item your practice will need to function, should a disruptive (and seldom anticipated) event occur. We’re talking about anything from a simple extended power outage to a data breach to a full-blown hurricane or out-of-control wildfire like we saw last year.

In a recent post, Forbes Technology Council member Monica Eaton-Cardone put it very succinctly: “While you can’t stop nature from disrupting your business, you can minimize the impact with good planning and preparation.”

There are also other types of disasters, such as an accident that takes you out of commission, or a crisis that seriously hits your reputation. Of course, you’ll want to do all you can to mitigate your risk, but taking the time to plan for “what-if” can help minimize business interruption costs, get you back up and running as quickly as possible, and help keep vendors, staff, and patients informed.

How at-risk is your practice?

First off, of course, it’s important to actually have a plan. If you’ve never bothered to put something down in writing, now is the time.

The first step to building your practice’s business continuity plan (BCP) is to assess the potential impact that various disaster scenarios could create. Try to imagine the most viable potential emergencies, then cross-reference that against the likelihood and impact of each event in terms of personnel, assets, finances, or personal danger.

The goal here is to set priorities. Looking at the “big picture” can help you develop plans for major disasters while also helping prepare for minor events such a power outage; it also lets you see how to divide your planning resources.

Developing your plan

Once you have a list of potential emergencies and their likely impact, take it a step further by creating strategies and documenting procedures to maintain services, recover any lost assets, and get your practice back to making money, as quickly as possible.

One part of this process would be creating a list of what actually needs to happen, and in what order. In other words, it’s important to know what to do, but it’s equally important to know what to do first. A few areas to address might include:

  1. Personal safety and safety of staff
  2. Checklists for assessing damage to assets (vehicles, buildings, equipment, etc.)
  3. Prevention of further destruction
  4. Checklists of forms and contacts for insurance and legal purposes
  5. Replacing lost paperwork
  6. Incident-specific response checklists

Once you have a detailed response plan, it’s time to make sure your people know what to expect and what their individual roles are. Gather your staff together and go over plans for various emergency situations. This gives you a controlled setting in which you can hopefully identify gaps in those plans and come up with ways to improve them.

One other area to consider: if trouble-causing event hit your entire community, you might also want to think about providing emergency services to locals who might have been affected

Is your BCP ready?

We often toss around the maxim, “Hope for the best, but prepare for the worst.” The reality, of course, typically falls in between those extremes. But a practice with a well thought-out contingency plan has a better understanding of the potential dangers and knows what critical actions are necessary to recover quickly and to minimize business interruption.

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Why Your Practice Should Take Credit Cards

Simply put, there aren’t very many dentists out there that don’t take plastic anymore. The biggest argument against them is the fee schedule, but that is becoming less and less of an issue, for one main reason: collections.

According to one survey, more than 40 percent of a typical practice’s receivables are owed by patients as direct payments. The average collection time is drawn out over 48 days, and the average annual patient out-of-pocket cost–roughly $650 per year as of 2014–is expected to increase as more employers switch to managed-care plans and health insurance companies tighten reimbursements for dental care.

It typically takes 30 to 45 days for an insurance claim to be settled. Add a few days for patient bills to be mailed and another 30 to 60 days for patients to send in their payment, and you’re looking at having the bulk of your receivables on the books for 60 to 90 days.

Oh, and you’re losing interest income on the outstanding amount, as well as the in-house costs involved in sending out bills, making follow-up calls, repeat billings. It’s a colossal pain in the keister.

Ah, say the credit card holdouts, but so is taking credit cards! Nice try. Modern technology has made accepting major cards easier than ever. There are just a few things that you will have to take care of first:

The Merchant Account

There are two commonly used ways of accepting credit card payments: through your own merchant account or via a payment gateway account provided by a third-party merchant. An internet merchant account–usually obtainable through your current bank–allows you to process credit cards by effectively extending you a line of credit that is used to cover the costs of transactions until funds are officially placed in your account.

The Gateway

You’ll also possibly need a payment gateway account. Gateways are online credit card processors that already has the clearance to connect your customers’ credit card accounts to your internet merchant account for the transferring of funds. The payment gateway interacts with the card issuer’s bank to authorize the credit card in real time when a purchase is made on a website. That means you get paid and the customer gets your product or service, even if the bank is closed at the time of the transaction.

Then There’s PayPal

PayPal is what is considered an electronic wallet, and it may be an even better option than credit cards. The service allows individuals or businesses to easily and securely transfer funds online. According to their site, PayPal has more than 87 million active accounts in 190 markets and 24 currencies around the world.

There are a number of good reasons to use PayPal:

  • * Easy to setup and use.
  • * Global name recognition.
  • * You won’t need a merchant account.
  • * Customers don’t have to have a PayPal account to pay you.
  • * Built-in invoicing tools.
  • * Lower fees than many merchant accounts.
  • * Easily integrated with popular shopping cart systems.

Still, PayPal isn’t the perfect solution for every small business. There are stiff fines for chargebacks, and you’re more susceptible to account suspension.

That can seem a bit daunting, but the point is, you have several options. Spend a little time investigating all the pros and cons of you using any of these methods … and compare them with the pros and cons of not taking electronic payments at all. In the end, it will most likely be mandatory, so why not go ahead and bite the bullet?