Strategies Dentists Can Implement to Overcome the Challenges of a Recession

The Transcript

Art Wiederman, CPA: Hello everyone and welcome to another edition of The Art of Dental Finance and Management with Art Wiederman, CPA. I'm your host. My name is Art Wiederman and I am a dental division director. Very proud to be part of the CPA firm of Eide Bailly. I'm out of Southern California and we're recording this in the evening of August the ninth. So what that means for me is that I get to celebrate another birthday. My birthday will have passed when you hear this podcast, but on August 14th I will turn 63. Not a humongous milestone, but it's another year on the candle and I feel great. In fact, today I spent I spent the day in my happy place.  

I have actually I have three happy places. The first place is a golf course, and that's where I was today. I was playing with some friends of mine and had some good shots. Had some bad shots. The driver was working the irons. Not so much, but I'm working on that and it's a lot better than it was and it's really fun to play. The second happy place is where I was about three or four weeks ago, which was in Alaska on a boat fishing for halibut. We caught some halibut, brought home about 30 pounds of it. Got to eat some of it while we were up there. Some beautiful, beautiful, beautiful, beautiful, beautiful, beautiful, beautiful countryside, 45 to 50 degrees, six layers of clothes. And then I came home and one day later turned around, packed my bag again, and got on an airplane to go from 45 to 50 degrees and six layers of clothing to 90 degrees and about 90% humidity or 900% humidity. It felt like I got to go to lecture.  

I was honored to speak at the National Academy of General Dentistry meeting in Orlando, Florida, and it was wonderful. I was at the Rosen Shingle Creek Resort, beautiful, beautiful resort, and I get to speak for 3 hours on metrics of a dental practice and 3 hours of financial planning. And I got to see my dear friend from 40 years ago back in pride actually sat in on her lecture day, Deborah Englehart Nash We're going to have Deborah and her husband Ross back on this podcast. Ross hasn't been on, but Deborah has been. Deborah is just one of the first one of the best consultants in the world and one of the funniest human beings I've ever met. So it was a great, great time.  

So I'm back in Southern California for a while. And tonight I want to talk to you about I want to talk to you about what it's going to look like if we go into a recession and what you need to be doing for your dental practice. And a recession is defined in the books of economics as two consecutive quarters of negative growth of the gross domestic product, meaning that our economy is contracting and shrinking. So I'm going to give you a whole bunch of things that you need to do to prepare. And a lot of this is being a leader and letting your team know that while we may be headed into a recession, Goldman Sachs says there's a 30 to 40% chance that we are going into a recession. I don't know. Time will tell. You know, we don't worry about it. We don't contract, we don't stop what we're doing. So we're want to talk about all of that.  

Just a couple of announcements. Number one, please, please take a look at our partner, Decisions in Dentistry magazine's website. They have over 140 amazing continuing education classes on all kinds of great clinical topics. Top authors from all over the world writing about clinical subjects at www.DecisionsinDentistry.com.  

Make sure that if you have not looked at the Employee Retention Tax Credit, that you look at that for the year of 2020. We are, believe it or not, folks are getting to the point that in about a year, actually a little less than a year, that window for 2020 is going to close. So if you haven't looked at it, if you had a greater than 50% reduction in your. Our gross receipts in any quarter of 2020, which would, for most all of you, be the second quarter or a greater than 20% reduction for any quarter in 2021, the first three quarters. As a matter of fact, you could be eligible. And we are getting calls at Eide Bailly. I have personally handled well over 100 ERTC cases. We're getting close to $5 million in tax credits and I get a lot of happy clients. And the program is there, the money is there, and it's for you and it's to be had.  

I again warn you that if there are if you are being contacted by companies out there that are telling you that you qualify for every quarter of 2020 and every quarter of 2021, the first three, I would be very, very wary. Read an article that was actually put on our blog by one of our wonderful CPA members, and they talked about some of the bad reasons why you qualify. My favorite one was somebody on Tik Tok told me that I qualify. Well, there you go. I mean, that that that seals the deal right there. Be very, very careful, folks. Most all of you who are going to qualify for the ERTC are going to qualify under the 20 and 50% rule. Some of you might have been shut down. But the fact is, if you were shut down during those times, which is the only time that you could claim the credits when you're shut down, you probably weren't paying your employees. So I'd just be really, really careful.  

The other thing in this podcast, I believe, is going to come up on the 24th of August. So that being the case, you have the rest of August and the entire month of September to do your required reporting on the HHS Provider Relief Fund Portal. If you received more than $10,000 in the period between January one of 2021 and June 30th of 2021, you must report information that is required by the Department of Health and Human Services HSA, or you will be asked to give back whatever money you have received from that program. So please, folks, if you haven't reported, get going with that. We can help you with it if you need some help. My office number is 657.279.3243 and my email is awiederman@EideBailly.com.  

So let's get into our topic tonight. Oh, one more thing. Sorry. Before we get into our topic, a shout out to my wonderful, wonderful friends at the Academy of Dental CPAs. www.ADCPA.org. Special shout out to my really good friend in Oklahoma. I think I guess part of the time he's in Oklahoma and part of the time he's in Maine. I believe Paul Woody just celebrated his 50th anniversary, 50th anniversary of being in private CPA practice. And, you know, I'm sure that many of you have mentors and people that you look up to and people when they talk, you just stare right in their eyes and you don't miss a word because every word is valuable. That's Paul and Paul's son Grant runs their CPA firm there in Oklahoma City. And I just want to wish my heartiest congratulations to Paul Woody for 50 amazing years. And Paul is one of the people in our group. Many of us do this, but he is really vocal about it, who is really, really advocating and I'm in 150% agreement with them advocating the private fee for service practice of dentistry and entrepreneurship, because you must be an entrepreneur to run your own business. And if you haven't had an opportunity to hear Paul either at a dental school, he lectures at the OU Dental School or hear him on a podcast or on just talking anywhere he is just absolutely just someone that you really, really want to listen to. So, again, great. Congratulations to you, Paul.  

Okay, let's get into the topic for tonight. And our topic for tonight is what do we do as private practice dentists in a recession? Now, for those of you that have graduated dental school in the last 5 to 10 years, you probably haven't hit a whole lot of economic downturn. In fact, our economy has been really strong through the decade of the 20 tens and now we're heading into the 2020s. Inflation has always been very low, like next to nothing. Interest rates were next to nothing, the federal funds rate. And remember that when they talk about the Federal Reserve raising interest rates, that is the rate the Federal Reserve controls, this rate that banks lend money to other banks overnight. So that rate was zero for some period of time. I mean, it was zero and it has now gone up to over I believe it's I haven't looked at it lately. Two and a half or 3% might even be higher than that. And the reason that interest rates are going up, folks, which is why we're talking recession here, the reason that interest rates are going up is because we have rampant inflation and we have rampant inflation because the government has pumped trillions of dollars into our economy and everybody's got money to buy stuff. And, you know, everybody wants to buy stuff and there's not enough stuff to buy because we have supply chain issues.  

We have a war going on in the Ukraine that is hurting grains and other, you know, items that need to be exported. It's hurting all of Europe. We have issues with China regarding the fact that China is having intermittent lockdowns of different areas of China to try and prevent the spread of COVID 19. They're very adamant about that. So that is hurting the supply chain. So, folks, inflation happens when there is more demand and less supply. And when inflation goes up, prices go up, people have less money. And what happens is, is that our economy, you know, it's a problem because people don't have the money to pay for goods and services, so they start thinking about cutting back. So what does the government do to try and cut inflation because I mean, you know, you look at gas prices, you look at home prices, you look at rents, you know, if a young couple just getting married wants to rent an apartment in a major city, I heard in New York City, in Manhattan, the average cost of a one bedroom apartment and I might have been wrong, might be also a two bedroom apartment is over $5,000 a month. That is absolutely insane.  

So what the government has been doing is they've been raising this federal funds rate. They're raising interest rates. They've raised it three times. A couple of weeks ago, they raised it 75 basis points. We're expecting that they're going to raise it again once, maybe even twice this year. And why are they doing that? The reason that they're doing that is because if you raise interest rates, it costs people more money to buy a house, to buy a car, credit card. Average interest rates are going to go from 17 to 19%. And what it does is it cools the economy down. So what they're trying to do is they're actually trying to get businesses to have less demand for their products as the supply chain issues come back. And they're trying to cool the economy down so that if there is less demand and more supply and businesses aren't selling as much, goods and services prices will come down. One would hope people will spend less money. And again, prices will come down, which is what they're trying to accomplish.  

The problem that the government has is that they waited a little too long is what a lot of people say. And what's happening or what we believe is going to happen is that this could very well put us into recession, because what happens? Prices go down. Businesses don't sell as much. They lay people off. Unemployment goes up. Right now, your unemployment rate is 3.6%, right where it was pretty darn close before the pandemic hit. So now what happens is as we go ahead, we raise interest rates. We cut demand for services and products. People spend less money. Businesses lay people off. Businesses don't do as well. Unemployment goes up and we have a recession because people of businesses aren't going to manufacture the goods and services at as high of a rate as they were before when everybody wanted the goods and services. So that's kind of the overview of what a recession looks like and where we're going. Are we going to get there?  

Well, I can tell you that and again, you guys have listened to my podcast for over three and a half years. Know that I don't do politics. I don't do Republican. I don't do Democrat. My personal views are really irrelevant here. But the Democratically controlled White House and Congress are saying, no, we're not going to have a recession. We're not going to happen. It's not going to happen. Not a chance. We're going to cut these interest rates. Demand's coming down. You can already see it. Gas prices have come down. I love it. Here in California, we listen. The average national gas price is $4.16 a gallon. Yeah, it gets to $4.16 and multiply that by about 50% more. And that's what we have here. Although they have come down. Rental cars are very, very costly and not easy to get. Airline flights are much more expensive.  

So we have this recession. So what does it mean to you? What it means to you is if we do go into a recession, most people think it's going to be a mild recession. It may last three months, six months, nine months. We don't know are people are going to lose their jobs, they'll get laid off. What does that mean to a dental office? That means that, number one, if someone doesn't have a job, maybe they have to dip into savings or maybe they can't afford to come to the dentist. It also means maybe they lose their insurance benefits. And that is a big deal, which is why we want to be talking. And I'll talk a little bit about in office membership plans, but I want to give you some of my thoughts as to what you do when there's a recession. So the first thing you got to remember, folks, is you do not want to change your total health and comprehensive treatment philosophy. Don't diagnose your patients pocketbooks. Don't say, oh, well, you know, I know that Suzy Smith is coming in at 10:00 and I know she and her husband, they struggle. And so, you know, I'm just I'm just not going to I'm not going to diagnose as much on her. I'm not going to present her with the comprehensive care that I might present to somebody else who's maybe the CEO of a company. Don't do that. And you as the leader of your team have to make sure that you let your team know that, yes, economies go up and they go down. We have periods of inflation, stagflation, recession, strong, booming economies. We have all kinds of things.  

I mean, it would be nice if everything were nice and smooth. The stock market went up 10% a year like clockwork. But it doesn't work that way, folks. There's way too many factors. So what you need to let your team know is you need to let your team know that we have a strong dental practice. And the number one important thing that we have to be. Cognizant of is the total health and care of our patients regardless of what the economy is. So we are going to continue to provide and present the best possible treatment plan for our patients. Because when you stop doing that, then you lose your entire purpose. You lose everything that you have built your dental practice on.  

So just because we have a bad economy, you know, people are going to talk about it and say, you know, if someone comes in and says, listen, I just can't do this now, you know, your answer is, we absolutely understand. We are here for you. Okay. So in the pandemic, that's what you said in 2008. That's what you said in 2001. All the years that we had problems, we're here for you, Mrs. Smith. I want you to know that our practice is committed to 100%. Make sure that you have the best possible total health as a human being as you as you can. And I would not be doing my job if I did not tell you that the best possible treatment that I can offer you right now is a crown on number 15 and 16. And this is why. And Mrs. Smith may say no, Mrs. Smith may delay it, but you must continue to do what you have been doing at all times and not even worry about someone's pocketbook. It's going to happen.  

Okay. I want to talk about likability. You know, I ran a CPA firm for 33 years by my dear friend and partner, Pam Chamberlin. I worked together, ran the firm for that long. And, you know, we had at our highest peak, we had ten people we worked with, I don't know, 200, 250 dental practices. And the thing about Pam and I and I don't have any remorse or reserve about saying this. Pam and I are two of the most likable people that you're going to meet. I mean, just absolutely everybody likes working with us. We're positive. And, you know, I was at Deborah Engelbart's lecture in Orlando, and she said something really profound about the likability is that 74% of patients that leave a dental office leave because they don't like the dentist, they don't like the team, and they don't like the vibe in the office. So especially in a period where we think we're coming into a recession, you must be a likable office.  

It's interesting. I've been preaching that for years, and the keynote speaker at our Academy of General Dentistry national meeting in Orlando was a gentleman by the name of Walter Bond. Walter was a he played in the National Basketball Association. He was a professional basketball player, and he talked about likability. Now, he and I did not talk before his talk to the group. We had, I think, 1700 dentists in the meeting, 2500 people all in for the meeting. And he was talking about likability. So think about a business that you go in where you go to and it could be a medical office, it could be a butcher shop, it could be a hair salon where you walk in and people look at you like they don't care. Yeah. You here for your haircut? Okay. Well, Susie, sit down. Susie, we'll be ready in a little while. I mean, that is not what you need to have. What you need to have is where a patient comes into your office and you say, Art Wiederman. And you walk out to Art Wiederman and you embrace me. Okay? Embrace me, shake my hand. Lots of hugs in dental office as if we've known each other for a while. And you say, All right, I want to let you know that Dr. Jones is ready to see you. And Stephanie, the hygienist, is ready to see you. And we are so excited that you're here. And let me take you back to your treatment room that we've prepared, especially for you. Now, you don't have to say it exactly that way, but the likability, if you have a team member who is a cancer in your office, someone who gossips, someone who complains about the doctor, someone who complains about the hygienist, someone who complains about some other team member or all came up with someone who is just flat out negative.  

Doctors in a recession. You've got to have all your cylinders at the highest peak performance. You've got to get rid of those people and you're going to go, Whoa, Lord, wait a minute, I can't find employees. Well, there are people out there. I had Holly Perez from Dental Direct on the last podcast we published. And I mean, there are people that are out there like Holly who can help you with your ads and to find people. It's hard. Don't get me wrong, we at Eide Bailly have the same issue. All professional service companies have issues with finding professionals. Things have changed. But the fact of the matter is, is you have to have a likable office. You have to have a likable team. You have to have a team that's like a family.  

Deborah told this great story, and I love I love this story. So Deborah's husband, Ross, runs a very high end cosmetic restorative practice in North Carolina, and she tells the story of when at 4:00, one day, a patient called and said, hey, I'm going to I think it was a wedding. And Deborah, if you're listening to this and I get the story wrong, you can text me and tell me I'm wrong and I'll correct myself on the next podcast. But Deborah, the patient comes in I'm sorry, the patient comes in and says, calls and says, Hey, I've got an event coming up. I want I need 20 veneers done and I want them done now. And so the front office went to the team, went to the doctor, and you know what they said, let's get it done. And they stayed that night until 11 p.m. How many of you have a team that would stay for a patient, for the practice, for the doctor until 11 p.m.? That's the kind of team that Ross Nash has, and that's the kind of team that I hope most of you have.  

Now I wouldn't recommend you having your team stay till 11:00 most nights because that gets old, but that's the kind of team you want to have. So if you have bickering, if you have backstabbing, if you have people talking about each other, if you have people sneering at each other. I mean, I have heard stories of, you know, the hygienist and the assistants staring at each other or sneering. When the doctor walks out of the room, patients see that. They tell their friends, it's a cancer. You've got to get rid of it. So I want you to think about having a likable dental office.  

The next thing I want to talk to you about is your metrics in a recession. You must know the numbers and you must look at the numbers on a daily, weekly, monthly basis. And when we talk about metrics, I've talked about metrics programs, there are a dozen of them out there are. The two that I'm most familiar with are Dental Metrics. My friend Rick Williford and Dental Intel, which is an outstanding program. They're both really good products. There are others, but those are the two that I'm most familiar with. And more than ever, we need to be using these programs. Remember, folks, if you're not familiar with these metrics programs, if you work with Dental Dentrix, Eagle Soft or Open Dental, these are programs that will actually sync with these programs and pull information out to help you find profit holes in your practice.  

For example, we want to look at the reappointment percentage. What percentage of your patients are being appointed after they leave their most current hygiene appointment? The national average is I mean, I've heard anywhere from 50 to 70%. Yours should be 90% with new patients and 80% with the rest or higher with the rest of your patients. Obviously, firefighters, airline pilots, things like that, you know, the flight attendants, they don't know their schedules. So with people like that, you set a placeholder and you say, Hey, Mr. Jones, I understand you're a pilot for Delta Airlines, and I know it's hard. Let's set this appointment for October the 25th and I'll check in with you a couple of weeks before and see how that's going. Then you've got a placeholder and they know that you're being you're taking care of them. The pre appointment percentage. What percentage of all of your active patients have a future appointment? That's sad, folks. It's down to the 30 and 40%. Many dental offices we need to know. Everybody needs to have a future appointment. The way you make money in dentistry is visits. It's seats in the chair. Okay, it's seats in the chair.  

So what's my pre appointment patients? How many active patients do I have in my practice that are not in regular recall? I mean, that is, you know, we're seeing 40%, 50%, 60% in active recall. I mean, you have patients out there who have not had three appointments in the last 18 months. You have patients who are due for re care, but they're not being they're not scheduled. This is lost revenues. If you could reappoint 20% of these people, you could be adding tens of thousands of dollars to your top line and remember every additional dollar of revenue you earn in your dental practice and I've been harping on this for three and a half years on this podcast, every single additional dollar of revenue has a net marginal profit of somewhere between 70 and 80% because doctors to do you know a to surface composite restoration for whatever three or $400 to do a crown to do an inlay or an onlay to do an implant a crown. You don't need to add additional employees to do that. You don't need to pay additional rent. Your computer costs aren't going to be any higher. The only additional costs you have for those procedures are lab and supplies, which run about 15%. So every dollar I can add to the top line. 70 to 85% of it drops to the bottom line.  

What about your case presentation? You know, what's your case presentation? You should be having an 80% case presentation based on the number of cases you present and 60% based on the dollars. Now, that could be different if you have a a practice where you're presenting large cases on a regular basis. What about your hygiene department, periodontal maintenance and SRP? You know, we want you to be looking to see do we have 20 to 30% of the hygiene in our office? In period, not, you know, period. I'll, you know, maintenance three four month maintenance. And are we doing SRPs? The national average is under 10%. Now we could spend a whole podcast talking about the liability and the issues of not diagnosing, treating periodontal disease in your practice. So these are the things do you have good collection policies? How are your collection policies?  

You should be your accounts receivable, which is the money that patients and insurance companies owe to you should be no more than 65 to 75% of one month's production. So if you are doing 100,000 a month in your practice, your receivable should be 65 to $75,000 at any time. If your receivables are 200,000, that means patients are not are walking out of your office without proper financial arrangements. They're walking out of your office without paying their share of what insurance doesn't pay the patient portion, if you will. And this is money that's not going in your pocket and your overhead doesn't go away. The landlord doesn't call you up. Okay. Hey, Art. So I understand that he's not doing a really good job collecting money at the front desk. So your collections are down, so. Yeah, don't worry about the rent this month. Does that happen at. Nope. Does it happen that way? Is the front desk and front desk making good financial arrangements. Are they following up on insurance and delinquent accounts? So if someone you know, I mean, it's and folks never, ever apologize about asking to be paid for your services, never, ever, ever, ever apologize. I've never apologized for our fees. As a dental CPA, you should never apologize for your fees, Mrs. Smith. You know, today's visit will be $452. Would you like to take care of that by cash, check or credit card? It's not whether she's going to take care of it, how she's going to take care of it. And it's a matter of fact. Well, I don't. They did bring my check, so. Okay. Well, Mrs. Smith, when can we expect payment? And if Mrs. Smith says, Well, what are you talking about? Why are you asking for money? That Mrs. Smith is not a good fit in your practice. So. So it's important that we collect money. All right.  

So here's another thought. If we start running into recession and if we have layoffs and if we have, you know, patients who are hemming and hawing about this, that means that there might be companies out there who are dropping their dental insurance coverage. So what a great opportunity to look into an in-house dental plan. A dental plan. I'm sorry, an in-house dental plan. So we had we had the folks Brad James from Kleer was on the podcast a couple weeks ago talking about an in-house dental membership plan. So. This might be a great time to sit down with your office manager and say, Hey, Susie, let's take a look at our patient base. And I want to find out how many of our patients are either CFOs, CEOs, chief operating officers or CEOs of companies. And, you know, it could be I mean, obviously, if it's General Motors, probably not going to go to General Motors for your dental office, for an entire office dental plant. But it could be ABC Tooling that has 90 employees.  

And, you know, maybe you go to lunch with the CEO or the CFO and say, you know, what we're seeing in dentistry is that dental insurance companies are more and more they're raising their rates to you, that they're cutting their reimbursements to us. It's really getting ugly. And it's getting to the point where we're hearing a lot of our clients who own companies are having to have serious considerations about whether to continue their dental plans for their employees. Well, you know, Mr. Jones, we have an answer and we have this office membership plan. And we, you know, for $299 a year, you could you know, your employees would get two cleanings and x rays. I mean, whatever it is you're going to provide and we will give every one of your employees a 10% or 15% or whatever you choose to do, courtesy off of our fees for our dental services. And I bet you they'll go back and run the numbers. So you have 100 employees and you're in your business at $299 is $29,900. I will bet you that businesses paying more in insurance premiums. To whatever insurance company it is, and they could be paying it to you. And you'd have all those patients. So an office membership plan in a recession is one of the best things that you can look at. Absolutely. Best thing.  

The other thing that you really need to be thinking about folks is cross-training your dental team. And the reason that that's important is if we get to the point where maybe your town is not doing as well. I remember, gosh, 30, 35 years ago, I lectured in Harrisburg, Pennsylvania, wonderful, wonderful town. And in that town, the major employer was the state of Pennsylvania. And what happened was, is that they changed insurance plans. So, you know, you need to be ready if, you know, they drop a plan or people don't come in. And you need to be ready for that. So you need to have your team cross-trained because if you have to let somebody go lay somebody off, everybody else needs to know how to do that assistant's job or how to do the front office job or the treatment coordinator job. Very, very important.  

Adding additional procedures during a recession is a really, really good idea. Okay. Now, again, you know, we're not going to go down the road of talking about what you should or shouldn't be doing. You know, we all know what additional procedures means that could be placing implants. That could be Invisalign, that could be sleep dentistry. I am a huge, huge, huge proponent of sleep dentistry. I've told this audience I've had sleep apnea for about 15 plus years, and I truly believe my dentist, Scott West in Mission Viejo, California, saved my life by diagnosing my sleep apnea. And I sleep with a CPAP machine very soundly every night. And I can probably count on one hand the number of times that I have it. The only times I haven't slept well. My CPAP is when I'm on the river fishing and there's no electricity and I don't have one of those portable machines. I should probably get one. But anyway. Adding additional procedures, doing additional continuing education.  

Doctors let your team know that regardless that there is a recession I Dr. Art Wiederman I am in the process of becoming a choice mentor. I'm going. I'm joining a spear study club. I'm going to Pankey for one of their continuums. I'm constantly learning, constantly getting better so that we can better serve our patients.  

That's what we need to be doing, is having a plan of what are we going to do? Are we going to add another treatment room? Does it make sense? Are we going to add another day of hygiene? Does it make sense? Are we going to raise our fees? We'll talk about that a minute. Flexible hours. I mean, we've now got people that are working at home like me. I'm raising my hand. You can't see me, but I'm raising my hand right now and I'm waving it into the computer because I gave up my office. I'm still working and I'm working at home and I'm loving working at home. I can have breakfast and lunch with my wife with about a ten step movement to the kitchen table. And it works out great. So, you know, people might want flexible hours.  

So if you can provide flexible hours, you're going to beat your competition. You know, always say yes. I told the story about Deborah and Ross Nash and Ross and his practice. Any time a patient asks you to do something, it's got to be yes. And it's got to be an enthusiastic yes. You know, I need a copy of this. And this is I need help with the insurance company. This is Smith. We're on it. We're all over this. We'll make sure that we take care of it. I mean, a perfect example is one of my wonderful clients here in South Orange County. Got we got them their practice, about a $68,000 Employee Retention Tax Credit for 2020. They got a they got a notice from the IRS that said, we're just going to disallow part of one of the quarters. It made absolutely no sense. So I got on the phone, I sent our client email. I said, I'm on it. We're going to take care of it. I sat on the phone on hold with the Internal Revenue Service for almost 2 hours, and then I got on the phone with them. And guys, it's really tough because once you get on the phone with them, they can't call you back. It's like, well, you know, if you're talking to your spouse or your child and you get disconnected, you know, their number, you can call them back. You can't do that with the IRS. So imagine you're sitting on hold for 2 hours and then the phone goes dead and you can't call that person back. That person can't call you back.  

So I said to this doctor, I said, We're going to take care of this. It's going to get done. And I finally got it done last week. 3 hours to get this thing done with the IRS, and that's it. This is what we do for our clients as dental CPAs. This is what you must do for your patients. The answer must be not only yes, but an enthusiastic yes. Absolutely. Okay. Verbal skills and asking your patients for referrals and marketing. Now, I'm convinced that while everybody says we need new patients and we have to get new patients and we can't do without new patients. No, you can't. Once you stop marketing your business, whether it's a dental practice, a CPA practice, a manufacturing business, whatever it is, once you stop doing that, your business begins to die. You must start asking your patients for referrals if you don't do that. And I can't tell you over 38 years in this profession how many times and what percentage of my clients and I ask them all, do you ask your patients for referrals? And over 50% of them, they don't say no. Some of them do, but most of them say, Well, not as much as I should. Okay. And here's how you ask for a referral. The easiest way to ask for a referral, because remember, your patients don't know that the lifeblood of your practice are new patients, because if you do your job within a year to two years, you will have basically done most of the dentistry on that patient except for ongoing maintenance. So, you know, and this is the talk about morning huddle here in a minute. But this is why it is so important to be able to say the following to a patient. So, Mrs. Smith, how does it go today? And Mrs. Smith says, Oh my gosh, Art, I can't tell you how much I love coming here. Your hygienist is wonderful. She's just I've gotten to know her as a person. She cares about me. Your front office is just wonderful. Whatever problems I have with insurance or whatever, they take care of it. Your dental assistant is just one of the happiest human beings I've ever seen. And you? You're great. And at that point, you say, Well, Mrs. Smith, I want to thank you for that. I'm honored that you would say those nice things about me and my team. And we're very fortunate here. And you can knock on wood if you like, but we're very fortunate here. We do have a dental care that we hear that a lot and we have a lot of happy patients, lots of hugs. And I don't know if you know this, but we're always looking for new people. But Mrs. Smith, there's one caveat. They have to be really nice like you. Okay? If they're not nice, I don't want to talk to them, all right? They need to be nice. And you kind of say it jokingly, and I can promise you that if you were to refer your family and friends to our practice, that we would take the world class care that we take for you and we would take that kind of care for them. And you have my honest my absolute word for that. And here's some of my cards. It's heartfelt, it's not rehearsed. And you ask them for referrals. Okay.  

I mean, I always talk when I do my lectures, I say, okay, let's think about Mrs. Smith, what she's thinking about today. And I've said this on the podcast before. Okay, yeah. Three things to do. I got to drop Johnny off at school. I got to go do the grocery shopping, I pick up the dry cleaning and. Oh, yeah, I also have to refer Dr. Art Wiederman five new patients. No, doesn't work that way. Most people don't know that you accept your patients if you are in a busy if you have a busy reception area. I don't like the term waiting room. I like the term reception area. If it's too busy and people have to wait, they think, Oh, they don't need new patients. They're so busy, they can't see me. If it takes six months to get it for a hygiene appointment, they can't see me. Well, that may be true. It may not be true. Make sure that you've built a war chest because in a recession, folks, cash is king. So my recommendation to you is, while I don't want you to stop living your life, I don't want you to stop taking vacations. My gosh, you haven't had a vacation for two and half years. We're all dying to get out and about and overseas and go on cruises and airplane rides and do all this stuff.  

But if we have, you know. If we have a recession, there will be no more PPP money. There will be no more ERC. There will be no more HHS. There will be I mean, the EIDL program is there. But that's a loan. That's not a grant. The government is done giving all of us money. They've increased the national debt by close to $10 trillion. It's up by 50% over, you know, three years ago. They had to do it. So you now need to build a war chest in your bank account so that if your practice suffers a little bit and I'll tell you, back in 2008, dental practices and I'll tell you, we came so close. There are books about this. We came so close to having 1929 the Great Depression happen all over again. I had clients calling me two and one day and they basically said, Art, should I pull my money out of the bank?  

And the dental profession came through with flying colors. Most offices were down 5 to 15%, where other businesses were just absolutely throttled and devastated. I mean, look at the pandemic. Most of you were shut down for 8 to 12 weeks. And with all the pent up demand, people came back. And did all of you do better in 2020 than you did in 2019? Probably not. Some of you did. Some of my clients did better, especially in the second half of 2020. But, you know, you need the war chest. You need to build the war chest. You need to have emergency savings of at least 3 to 6 months. So if your personal living expenses are 15,000 a month, you need 45 to $90,000 in a secure money market savings account, whatever it is. So that if this economy goes into recession, that you don't have to worry about your next loan payment. You don't have to worry about your next mortgage payment. You don't have to worry about your next college tuition payment. Absolutely not.  

So let's talk for a minute about the morning huddle and some of the things that these metrics programs talk about. So, you know, I've got and again, I, I've got information from both Dental Metrics and Dental Intel Dental Intel's got a really cool poster and it gives you kind of step by step, kick off the day 2 to 3 minutes, get the team excited to be there for the huddle, have a, you know, have some coffee dance party. I mean, you know, just celebration. Just let's start off on a positive note. Let's then talk about the previous day. What happened? How did we do? We had goals. Our goal was $5,000. Okay, celebrate a couple of things that went well, you know. So, yeah. What went well? Oh, yeah. Mrs. Jones came in at 11:00 and she was scheduled for a crown and we were able to do some additional same day dentistry and we did two additional crowns that day. That's a celebration, folks.  

You know, what about a goal for the month that you're trying to improve on? Maybe we're trying to increase reappointment percentages. Maybe we have to work on at the front desk, making sure that part of our conversation when we check everybody out is to make sure that they are scheduled for a future recall, a recare appointment. You know, that goal, whatever that is, champion one of your team members and talk about it every morning how is that going? What about patients who left without scheduling a future appointment? How are we going to get them? Who's going to call them? Okay, let's talk about then today's schedule. All right. And that's one of the cool things that the Dental Metrics has. Rick Wolfers program has is a it's a it's a it's one sheet and it's got all these different things. Okay, whose birthday is it today? Who's a new patient? Have we confirmed that patient? Has that patient's work come back from the lab? Are there any medical alerts that we need to know about? Are there any balances that we need to collect? Are there any patients who are family members of that patient that's coming in? Hey, Steve, how's your family? How's Joan and the boys doing? You know, we're real concerned that we talked about in our morning huddle that, you know, we haven't seen Joan and the boys in the office for over a year. Are they okay? Yeah, we're worried about it. They have any questions, anything we can do? And, you know. Oh, well, yeah, you know, we were talking about that. We talked about that today. And what we really need to do is we need to get them in there and say, so I have your permission to call to give them a call and see if they want to come in. Absolutely.  

We want to compare the production goal with what we scheduled. What I look at the open areas we need to make sure guys that. If there is a two hour block of production from 10 to 12 on Thursday and today is Tuesday, wouldn't it be nice that the doctor knew that? Wouldn't it be nice that the assistant, the hygienist knew that? Because what happens? You go in there, doctor does an exam and we find this out and say, oh, boy, you know, that tooth looks really, really bad. I'm thinking in lay up to get on lay, I'm thinking crown, whatever it is. And by the way, in our warning huddle, I think we have a two hour block on Thursday. Are you available, Mr. Smith? Because I'm really, really worried about this. Need to know the clinical team needs to identify areas where extra help is going to be needed. You know, maybe there's a reconstructive case, maybe there's a, you know, a full arch that we're doing. Maybe we need an extra assistant. We need to know that we talk about unscheduled treatment, family members of patients overdue for hygiene. So that's a maybe five minute block of your morning huddle. Morning huddle is not going to take more than 10 to 15 minutes. And then one of the things I bet is some sort of a motivational minute, a funny video or an inspirational quote or something to get the day going. And that's your morning huddle. And that is so important. And I can't tell you how many offices how many offices don't do morning huddles or they do them intermittently. Okay. I mean, absolutely. You really need to do the morning huddle. And it's so, so important.  

And the last thing I want to talk about is, is one of the things that you should be focusing on not only during a recession, but at all times, is how to talk to your patients and how to present the case and how to make sure that you are perceived by your people. Not only that they like you, but that you care for them and they trust you, and they trust you like their family. Because once you build the trust and this is so, so important in a recession, is when people are uncertain about are they going to have a job, are they going to get a raise? Are they going to be able to make their next house payment? And dentistry goes from being something that's like a no brainer. I'll just put it on the credit card to well, I don't know if you have not built a feeling of trust with your patients and that you care about them and that every single person who works in your office cares about every single patient and it's genuine. If you don't have that culture in your office, people will find a reason to go somewhere else.  

When people are stressed, they want to feel happy. They want to feel like they're being cared for. And that is something that you need to do. And so in a recession, folks, you know, we don't panic. We don't freak out. Gosh, I used to have a I've told this on the podcast that, you know, when you've done over 150 of these podcasts, you don't remember what you've said for podcast, the podcast. But I used to have an employee who worked for me who obviously remain nameless and every single time that something was not going right, every single time what would happen is, is she would come in and, oh, my God, we have a major crisis. You know, it was about I have an ingrown toenail. It's a major crisis. So finally, what I said to her, as I said, all right, there are two major crises or crisis as crises, I guess crises. There are two major crises that I will allow you to present to me. One is someone is dying or has died in my office. And number two is the building is on fire and we must get out. Other than that, we will figure it out.  

And folks, if you're stressed and you don't know what to do, I mean, I've been meditating for years and it relaxes me. And I don't worry anymore about things I don't control. I don't worry if the inflation rate is 9%. I don't worry if gas prices are $5 or $6 or $12 or $100 a gallon. I don't worry about that. What I worry about is how can I take world class care of our clients? And you should be worrying about how can you take world class care of your patients? So that's my words of wisdom for how to deal with a recession. I certainly hope we don't have a recession if we do. I really think that our economy in the long run is very strong. It will come out of it. We'll see what happens with the midterm elections and the first week in November and we'll see if we still have a Democratic white. Well, we know we'll have a Democratic White House. Well, we have a Democratic House of Representatives and Senate. Or will it be a Republican House? Republican Senate? Democratic Senate? We don't know. We'll see what happens. But hopefully the folks in Washington will figure this out and we'll be able to bring inflation under control. And if there is going to be a recession, it will be short lived and it will be mild. And that's all we can hope for.  

So with that said, please again go to our member, you know, our partner Decisions in Dentistry magazine www.DecisionsinDentistry.com for great clinical content and 140 continuing education courses per year at a very reasonable price. If we can be of help for you at Eide Bailly, we are always accepting. Okay, so here it is. Okay. I'm asking for a referral folks, just like I was teaching you earlier. So Dentists of America and around the world, this podcast is heard in like 60 different countries. I believe we are accepting new clients. So if you are getting this right to tell people, if you're getting great service from your CPA, you should stay with your CPA. If you're not getting great service, if they don't care and they don't give you the time of day or return phone calls. The number one reason, by the way, folks, that dentists or all business owners leave a CPA to go to another one is failure to return phone calls. And I beat that into my team for over 30 years. So, you know, if you if you're not happy with going on and you want somebody who understands your business, give us a call. My office number 657.279.3243 and my email is awiederman@EideBailly.com.  

I think that's about what I've got for you. I'm going to go out on Sunday of this week, August 14th, and I think my oldest son, Nathan and my wife Lynn and I are going to go to one of my happy places. We're going to go play probably go play nine rounds of nine rounds. I'll be all right. Nine holes of golf and relax into the sunshine and go have lunch and maybe have dinner and I'll get to put another candle on the birthday cake. And am I excited about it? Yeah, I am. Because as my late mother Cynthia used to say the alternative stinks.  

So with that said, everybody, I want to thank you so much for the honor and privilege of your time, for listening to my podcast, for the thousands of people that listen to this podcast every month, who listen to the different podcasts that come out, I truly hope. I truly hope it is my wish and my legacy that I have given you the inspiration and the tools and the kick in the pants to make your dental practice better, to make your life better, to make your ability to meet your personal financial goals, to retire, to put your children through college. Proper insurances, estate plan, you know pay as little as you can in taxes. I hope I've been able to do that with you, for you. And it's an honor and a privilege to be speaking to you on this podcast. And with that said, this is Art Wiederman for the Art of Dental Finance and Management with Art Wiederman, CPA. And we will see you next time.