Do you offer capitation plans, often referred to as full care, in your practice? If you had a choice to click your fingers and switch all your plan patients to a maintenance plan instead, would you?
If the answer is yes, read on.
Capitation plans were the original dental plan concept that came to market many moons ago. While they are still around and offered by some practices, many dentists are transitioning away from this arguably outdated model.
As a cost-effective major plan provider with low admin fees, Patient Plan Direct has helped an increasing number of practices successfully transition from capitation plans to offering a simpler maintenance / membership type plan.
The key is down to communicating the rationale and benefits to patients effectively in adopting such a change. In doing so, you retain loyalty, moving them to a model that can be a better fit for all parties.
Before we share one method of managing the transition that you may consider, which we have implemented successfully with several practices, let’s take a look at some of the potential pitfalls of capitation plans, which sets the rationale for considering such a strategic decision:
Resource intensive
For capitation plans to work for a dental practice they require ongoing assessment and scrutiny.
When assessing capitation category fees, every year (when fees are reviewed) a minimum of 10% of each patient base in each care plan band should be audited. This identifies the average amount of time these patients take up in surgery. This can be a lengthy process and so can often be overlooked. Therefore care plans are not accurately priced and likely negatively influencing the profitability of the business.
Patients should also be reassessed every 24 months to ensure they remain in the right category and are paying the correct monthly fee. Practice teams can find the conversation of moving a patient up a band to a higher monthly fee uncomfortable. This could cause them to avoid completing the reassessment.
They don’t help secure loyalty from the outset
Patients must be dentally fit to join a capitation plan. This means patients must have a new patient examination and complete any outstanding treatment that is diagnosed before a plan can be offered.
This can make it difficult to make joining a plan the default action, which it should be if trying to optimise plan uptake. It can also create disjointed conversations between practice teams and the patient when plan can only be offered once all outstanding treatments are complete.
Because of this, new patients cannot commit their loyalty to a plan straight away. You can often lose the opportunity of retaining the patient long term.
Financial ceiling on earnings
As capitation plans often cover all clinically necessary routine treatment, unless patients are electing for cosmetic treatment or high-ticket items not covered under the plan, the practice and the dentist can place a financial ceiling on their earnings from a care plan patient as no restorative treatment can be charged for.
Supervised neglect
There have been numerous instances over the years whereby capitation plans can sometimes nurture supervised neglect, with some practice sales now having a hold on a significant percentage of the sale value for several months while the new owner reassesses and completes any outstanding treatments on capitation plan patients.
This is creating an additional layer of complication when you come to sell your practice that could be avoided if patients were just on a maintenance plan.
Maintenance plans are prevention focused and only cover routine appointments (not treatment). Every treatment prescription carries earning potential and ensures patients are being made aware, with treatment plans, of outstanding treatment as it is identified. Maintenance plans arguably more proactively promote treatment diagnosis early, rectifying problems before the patient knows they exist.
In summary, maintenance plans don’t require any of this ongoing and often cumbersome management a capitation plan needs. They are a simpler concept that is more aligned with the appetite of a modern-day consumer/patient.
Switching plan provider and removing capitation plans
A great time to consider introducing such a strategic change is alongside switching plan provider. At Patient Plan Direct, we have worked with a number of practices that have taken the opportunity to communicate a change in plan offering at the same time as switching plan provider, sharing both changes in the same communication.
We have tailored the means of communicating this change effectively and can evidence strong retention following the transition.
Alan, founder and clinical lead of Paste Dental in Belfast, experienced the limitations and drawbacks of capitation plans firsthand. Seeking a more transparent alternative, Alan decided to switch dental plan providers to work with Patient Plan Direct and ditch capitation plans – all while making healthy five-figure admin fee cost savings. Watch the video to hear about his experience.
Find out more
In an industry where trust and affordability are paramount, choosing a plan that prioritises both patient and dental practitioner needs can make a significant difference. While capitation plans have been a longstanding model, it’s crucial to recognise their limitations.
If you’re seeking a cost-effective plan provider and a means of moving away from capitation plans, contact us to explore how switching plan provider to Patient Plan Direct can not only result in substantial savings on your plan admin fees but also enhance your patient loyalty and reputation.
Book an exploratory meeting with our team:
The Patient Plan Direct advantage
Patient Plan Direct stands out as a low-cost dental plan provider in the market. Our dental plan administration fees are low for various reasons.
With prospective clients who are looking to switch plan provider, we do encourage the consideration of replacing capitation plans with appropriately priced maintenance plans. They offer many more benefits, and patients are usually more than happy to switch to this alternative type of plan (which is usually lower in cost) to maintain their oral health.
Opportunities for cost savings
In an industry where trust and affordability are paramount, choosing a plan that prioritises both patient and dental practitioner needs can make a significant difference. While capitation plans have been a longstanding model, it’s crucial to recognise their limitations.
If you’re seeking a more cost-effective alternative, contact us to explore how switching plan provider to Patient Plan Direct can not only result in substantial savings on your plan admin fees but also enhance your patient loyalty and reputation.
For more information visit www.patientplandirect.com.
