Creating an In-House Dental Membership Plan
There are a number of ways in which dental practices can benefit from establishing their own in-house dental membership programs. As opposed to operating within an insurance network, practices that manage their own in-house programs are able to dictate the policies and discounts that they offer to patients. In-house memberships allow you to provide the best discounts to your patients, while maintaining the freedom and flexibility of a fee-for-service business model.
In-house memberships are also a predictable source of revenue for your dental practice. The memberships operate on a monthly subscription basis, which means that you’re generating income off of patients even during months in which you’re not rendering services to them. If you offer a $35 monthly subscription with 300 subscribers, you’re earning $10,500 each month in revenue. Creating a membership program at your practice can help you establish a more consistent cash flow.
This consistent revenue flow can significantly increase the valuation of your practice, which is especially useful when you go to secure a new line of credit, or if you are hoping to sell off your practice at some point in the near future.
Starting and Managing a Dental Membership Program
One of the first things that dentists need to do if they’re considering implementing a dental membership program at their practice is establish the pricing model that they’re going to work within for their subscription service.
It’s important to charge enough that you’re still generating a profit on the discounted services, while also not deterring your patients from subscribing to the service. For instance, if you generate roughly $300 annually from a patient based off their subscription fees, it’s likely that you can comfortably offer a discount of 10 percent for major procedures and 15 percent for routine services.
The beauty of an in-house program is that you can formulate in a way that makes the most sense for your practice and your patient base. You can even develop different subscription tiers—higher levels may cost more each month, but offer greater service discounts—if you feel that there’s a demand for differing levels of subscription service amongst your patient base.
Dentists should always bill membership plans on a monthly basis, and set them up around annual contracts that automatically renew each year. It’s also advisable to establish an auto-pay system with your patients so that your team members don’t have to spend time recouping subscription fees.
There are some state and local regulations to be aware of while starting your dental membership program. For instance, you should never call a membership program “insurance,” because it’s not. It’s more similar to a discount club that you’re offering at your dental practice.
It’s advisable to consult with a dental membership expert prior to starting an in-house program at your practice for advice on state and local regulations that you’ll need to keep in mind. In most cases, a retainer agreement or a direct primary care agreement between the patient and the practice is all that’s necessary to legally operate an in-house dental membership program. That agreement needs to state that it’s not dental insurance, and it also needs to state what’s included with the program.
BoomCloud, the company that I created, offers software that allows practices to create, organize and automate a dental membership plan. It automates all payments and contracts through our contract or agreement management software. It’s very important to document patient agreements, payments and more. Proper management is key to the success of your dental membership program.
Marketing an In-House Membership Program
A question that I hear all the time, in regard to creating a membership program, concerns how to market and grow the program. The benefits of a membership program sound great, but it’s not just going to happen out of thin air. It’s going to take some effort for the practice to create a dental membership program, which is a good thing. It’s worth every ounce of effort.
It’s important for dentists to reach out to their local, external markets while advertising an in-house membership program. For instance, traditional marketing techniques, like direct mail, can be an effective way to grow your in-house membership subscriber base.
Targeted online ads, like those on social media and search engines, are becoming increasingly valuable tools that dentists can use to market in-house membership programs. Maintaining a positive online image, particularly on social media pages and review sites, is key to establishing the credibility of your membership program.
Jordon Comstock is the Founder and CEO of BoomCloud, a dentistry membership software services company. BoomCloud’s tools help dentists create, program and automate their in-house membership programs.
Jordon’s career in dentistry began as a dental lab technician. He managed the Salt Lake Dental Lab for seven years, where he learned the ins and outs of managing a large-scale dental operation.
In 2013, Jordon founded BoomCloud with the goal of empowering dentists to create and manage their own in-house membership programs. BoomCloud is a collection of software tools designed to help dentists keep track of their in-house membership subscribers. BoomCloud provides practices with the tools necessary to successfully create and scale a customized membership program solution.