What You Need to Know About PPOs and IPAs

Episode #440 with Dr. Barrett Straub

There's an old story of what success looks like in dentistry. You're always busy, packed with patients, making millions, and have tons of PPOs. But if you're here listening, you already know something’s wrong with that picture. And in this special edition podcast, Kirk Behrendt and Dr. Barrett Straub introduce ACT’s new PPO Roadmap, a guide for insurance independence to help you work smarter without the fear of dropping bad PPOs. Don't stay stuck in high-volume dentistry! If you're ready to take control of your life and practice, listen to Episode 440 of The Best Practices Show!

Main Takeaways:

Learn to work smarter, not just harder until burnout.

Don't chase patients and production without strategy.

You can provide great service without giving it away.

Knowledge will remove insurance independence fears.

Your life should always come first.

Quotes:

“We, as leaders, have egos. We have pride. And I think, sometimes, we tell ourselves, ‘I should or can be all things to all people. I should be the leader that can be a visionary and the implementor.’ And what I've learned through this is no one can be everything. No one can be perfect at all phases. And when you surround yourself with the right people that have skillsets that fill in your blind spots, it’s amazing. Not only can you accomplish more, but work is more enjoyable.” (11:50—12:23)

“We, by no means, are anti-PPO. We are pro-insurance independence. And so, sometimes, the narrative in dentistry becomes, ‘You've got to cut all your PPOs. You've got to become fee-for-service. It’s the only way to do it.’ And we love fee-for-service. I personally have been doing it my whole career. I love the model. However, every practice is unique, and every dentist is unique, and they’ve got to find their own sweet spot.” (17:05—17:32)

“We’re launching the idea of insurance independence. And what that means is you have enough payers, 100% payers, where you get 100% of your fee that if you stopped all your PPOs the next day, you could still be profitable enough to pay your bills.” (17:34—17:54)

“We all became dentists, and we bought our own practices, and we’re business owners, in part, for freedom. We want to control our own destiny. We want to practice the way we want, with who we want, on who we want.” (18:20—18:32)

“If we really think about the number of lives we can impact — a small impact, a great impact — every day, we come across so many people. It’s a great profession.” (19:11—19:21)

“When you sign up for a PPO, you're saying, ‘I accept a 10%, 20%, 30%, 40% discount. I'm going to write it off.’ And I'm willing to do that because the belief is that the volume of new patients or the volume of people accessing my practice, because I'm on the list, will outweigh the write-off. That, by definition, is a high-volume method. So, whether dentists know it or not, or made a conscious decision or not, they're in the high-volume game.” (21:31—22:07)

“Once you're in this vicious cycle of the high-volume game, it’s hard to get out because you're working harder — because you have all these patients that you need to see. And you've got to see a lot of them because you're writing off 30%. And when that happens, a patient that has no insurance that wants to pay you full fee, they can't get in for six weeks because your new patient schedule is booked out. So, they go elsewhere. And so, it becomes harder, and harder, and harder to break out of that. All the while, your margin is shrinking.” (24:46—25:17)

“Dentists, we need to stand back and look at our practices as if we’re a third party looking in and say, ‘Some of this stuff doesn't make sense. I have to think smarter and think differently about who I allow in my practice and the business strategy so that I can increase that margin.’ It doesn't mean that you've got to cut all your PPOs, ever. But the [PPO] Roadmap is going to show you how to identify maybe some that shouldn't be on your list so that you can become a little more independent of insurance, see more people that are going to pay you 100% of your fee, and then you can work a little less and a little easier, and be a better dentist and a better dad and a better leader because you're not running with roller skates on.” (25:19—26:02)

“If you're the person who’s like, ‘I don't have a life,’ you need help.” (27:51—27:55)

“Dentistry is hard because you've got to do dentistry. So, you can't always be up at the front desk making sure your admin team is doing the best practices. And my prediction is a lot of dentists out there feel or think their team is billing out their one full fee, and they're not. And no fault there. It’s just hard. It’s hard to do everything all the time. But we’ve got to bill out our full fee.” (30:39—31:03)

“Fee-for-service means you're getting 100% of your fee. And you can take assignment of benefits, or you can be fully fee-for-service where you charge the patient 100%, bill their insurance, and they collect their insurance check. Both, in our definition, fit into fee-for-service. So, that can get too complex. We just break it in, do you get 100% of your fee, or do you not get 100% of your fee?” (31:05—31:30)

“The only write-offs that I write off are what I want to write off. Out of the goodness of my heart, or we remade a crown because it failed, or, ‘Bob just got diagnosed with cancer. I'm not going to charge him today.’ And I just say, ‘Professional discount, per doctor.’ And we have, sometimes, 5% pay-in-full discounts, stuff like that. But just purely write-off, it’s just when I feel like it. And I love to write stuff off.” (32:23—32:57)

“I don't believe that we've provided enough tools for dentists to be able to reverse the PPO reality that they find. Once you're in, it’s harder to get out unless you have some guidance. And the dental industry, there hasn't been great guidance on how to get out of some of these. And that's why we’re here.” (35:03—35:22)

“We hear dentists all the time talk about, ‘I produce this. I had 52 new patients last month. I had people breaking down the door.’ But we know, we look at the numbers, ‘But you're writing off 35% of every dollar you produce.’ And part of me says you’d be better off, at least to start, cut a day. You can make the same amount by working three days a week instead of four. Cutting those PPOs, getting rid of that discount — and we’re not saying do that — the math doesn't make sense. Right? I'm going to continue to work harder for a decrease in margin. And when you have decreasing margin and you have all these PPO patients coming in, you have less capacity for the 100% payers. It’s getting more and more competitive, and it just becomes harder and harder.” (36:33—37:27)

“We watch dentists all the time chase production, chase new patients, without looking at the adjustments and the bottom line and really doing business thinking, ‘How do I work less and make more? How do I work smarter and make more?’ Time is the new rich, as you like to say. How do I create more time in my life and make the same, or create a lot more time in my life and only make 5% or 10% less, but that 5% or 10% allows me to be an amazing dad, husband? I mean, these are the kinds of things, life-changing scenarios, that I think this [PPO] Roadmap is going to help some dentists do.” (37:28—38:08)

“Serving the public doesn't mean giving it away, in my opinion. There is a way to serve human beings by giving them great oral dental care and being a great provider. It doesn't mean we’ve got to do it for 30%, 40% discount. Free dental care doesn't equate to serving the public.” (40:42—41:07)

“Patients call up and they say, ‘Do you accept my insurance?’ We automatically feel like if we said no, they're going to go away, or that insurance is crazy important to them and that they have to. And why is that? Because we've been ingrained through medical insurance that we can only see doctors if they're on our insurance. And in medicine, that's largely true. It’s not the case in dentistry. But the public, that's how we think.” (41:14—41:41)

“Your dental team, because they don't know any better, they feel, ‘Oh my gosh, [patients] are very focused on insurance.’ Dentists feel that way. The truth is, I think it’s far from the truth. When that same patient goes to The Home Depot and buys a refrigerator, they know they're paying 100%. When they go to the Ford dealership and buy a car, they know they're paying 100%. They just don't ask the right question because they don't know what they don't know.” (41:53—42:18)

“When you're a single doc, or you're a partnership and you talk about going off of PPOs, it becomes an insurmountable task because you don't know how to do it. And sometimes, leadership is a little lonely, and you fear the ramifications. But you can easily get rid of fear by having strategy, by having knowledge, by having a step-by-step process.” (45:35—45:55)

Snippets:

0:00 Introduction.

7:36 Dr. Straub’s ACT story.

15:04 Gain insurance independence.

18:33 Why Dr. Straub became a dentist.

20:44 Dentistry has a shrinking margin.

23:01 Getting out of the high-volume game.

26:02 Get back on path to a great life.

28:58 Defining fee-for-service and PPOs.

31:50 Learn how to charge your full fee.

33:21 The progression of a dentist.

35:22 Learn to work smarter, not just harder.

40:07 The struggle between serving and getting paid.

43:03 More about the PPO Roadmap.

45:27 Knowledge is power.

47:11 India Pale Ale (IPA) Trivia.

Reach Out to Dr. Straub:

Dr. Straub’s Facebook: https://www.facebook.com/barrett.d.straub

Dr. Straub’s social media: @bstraub10

Resources:

Traction by Gino Wickman: https://benbellabooks.com/shop/traction/

Other books by Gino Wickman: https://benbellabooks.com/authors/wickman-gino/

ACT Dental’s PPO Roadmap (launches July 8, 2022): https://form.jotform.com/221574987947173

ACT Dental’s To The Top study club: https://www.actdental.com/ttt

Dr. Barrett Straub Bio:

Dr. Straub practices general and sedation dentistry in Port Washington, Wisconsin. He has worked hard to develop his practice into a top-performing fee-for-service practice that focuses on improving the lives of patients through dentistry.

A graduate of Marquette Dental School, Dr. Straub’s advanced training and CE includes work at the Spear Institute, LVI, DOCS, and as a member of the Milwaukee Study Club. He is a past member of the Wisconsin Dental Association Board of Trustees and was awarded the Marquette Dental School 2017 Young Alumnus of the Year. As a former ACT coaching client that experienced first-hand the transformation that coaching can provide, he is passionate about helping other dentists create the practice they’ve always wanted.

Dr. Straub loves to hunt, golf, and spend winter on the ice curling. He is married to Katie, with two daughters, Abby and Elizabeth.