From a financial perspective, these are tough times for dental practices. Sure, you may be seeing a greater number of patients, but at the same time, the amount insurance actually reimburses seems to get lower every year, while expenses continue to skyrocket. Adding insult to injury, dentists are also expected to keep up with continually evolving compliance issues and mountains of paperwork to get the reimbursements they are entitled to.

There is still hope, however: even with these rising pressures, there are almost always ways to save money in your practice. Think of it in terms of revenue leaks: common areas of waste and inefficiency that could be draining thousands of dollars from your business. These leaks need to be plugged to ensure the sustainability of your practice while you focus on patient care.

Some typical areas of leakage:


Many dentists can be overly cautious in the area of coding, often using a lower billing code in case they get audited: better safe than sorry. According to studies, this so-called downcoding can cost you tens of thousands of dollars in lost revenue each year.

Undercoding a procedure is like a mechanic charging $500 for $1,000 worth of services. Practitioners claim to do this so as not to attract the scrutiny of insurance company auditors, but the practice could actually backfire: undercoding itself can also trigger an audit. Insurers and the government look at any suspicious payments, which means both underpayments and overpayments.

To plug this leak, dentists should bill at the appropriate level while keeping comprehensive and accurate documentation to support each submission. Always include the patient’s name and relevant medical history, reason for the visit, your diagnosis or assessment, and action plans. That sounds like a lot of work, but using electronic health records can simplify this process while simultaneously guarding against downcoding; an EHR system can also be used during an audit to show that the coding was correct.

Inefficient Billing

Billing can seem like a pain, especially for “smaller” amounts. The fact is, however, that it doesn’t take many small invoices to equal one large invoice. If you’re not diligent about billing patients and collecting outstanding balances, you could be leaking thousands every year.

The best way to plug this leak is to have established accounts receivable procedures so every person on your staff knows how things are supposed to work. Having procedures in place not only ensures that everything runs in a streamlined, consistent manner, it can also protect you against unintentional legal violations and keep you up-to-date on exactly how much money is owed to you–an important piece of information when making financial decisions.


Most dentists these days accept credit cards. It seems like a great way to get payment at the time of service, without having to worry about bounced checks. But hold on: just because a transaction has cleared doesn’t mean you for certain have the funds. Patients can file a chargeback against you for up to six months after the payment.

Why would patients do this? Perhaps they were unhappy with the service. Perhaps they felt like you didn’t solve their problem. Or–in a frighteningly increasing number of cases–they may have just discovered that by calling the bank and complaining, they may receive something for free. Industry insiders term this “friendly fraud.”

It isn’t very friendly for you, however: not only can the transaction amount be transferred back to the patient’s account, both the cardholder’s bank and your own bank may hit you with fines or administration fees. If you use a third-party card processor, you may get fees from them, as well.

To plug this leak, go over all documentation associated with your credit card processing. Make sure you are adhering to their mandates (which often change, unfortunately). Then make sure your entire staff understands the importance of making each patient touch point a positive experience: a patient who feels slighted by the receptionist is every bit as likely to file a chargeback as one who feels uncared for by the dentist.

Finally, again, thorough records of each visit are crucial: with the proper records, you may even be able to challenge a chargeback and win. Having said that…such cases are time-consuming and hard to win…and what’s worse, you’ll still have to pay any fines or fees. Prevention is a much better plan here.