Howard Speaks by Howard Farran, DDS, MBA, MAGD

You knew it ten years ago, but the prestigious Mayo Clinic is just figuring it out today. After loosing a tractor-trailer of money, Mayo pulled the plug on its HMO's in both Rochester, Minn. and Jacksonville, Fla. In trying to capture the high-end lucrative senior citizen market that can afford a second home, the Mayo Clinic established satellite offices in both Jacksonville, Fla. and Scottsdale, Ariz. Mayo has now closed their HMO operations in Jacksonville leaving only their money loosing HMO operation in Scottsdale open.

Note to Mayo Clinic:
Close the Scottsdale HMO before you loose millions of dollars more!
The Mayo Clinic in Scottsdale absolutely blows my mind. Each winter more than 300,000 senior citizens arrive in Arizona (known locally as snowbirds) to spend their winter months in the warmth and sun. They begin to arrive around Thanksgiving and usually will leave before April 15th so they can be at home in time to file their taxes. Each year in our Today’s Dental family practice in Phoenix, Ariz. we see dozens of snowbirds as emergency patients. Each year, several dozen of these snowbirds will complain to me that they didn’t make their appointments in time for a physical at the prestigious Mayo Clinic in Scottsdale and are sad because they won’t be able to get in for a physical during their entire winter stay. These patients are depressed they will have to go back to their small town of Bumblebutt, Kan. and see Dr. Tightass. While these patients are telling me all of this, I’m looking at the newspaper reading about how much money the Mayo lost, AGAIN!

This phenomenon is very bizarre to any dentist with an MBA. First of all, if you have so much demand coming from patients that a line forms outside your door, why are you participating with HMOs? Especially if you are loosing money with these HMOs! Secondly, none of these snowbird patients of mine said, “I was going to go to the prestigious Mayo Clinic for a physical, but when I heard how much money they charged, I said forget it.” Every one of them, every year, for the last ten years, says, “I couldn’t get in before I have to go back home in three months.”

Note to Mayo Clinic:
Raise your prices!
How many times do I see this with dentists and specialists? You refer a patient to a specialist and the patient calls your office back in an hour and says, “Can you give me the name of another specialist? The one you recommended can’t get me in for three weeks.” In economic theory this is called the “Line Queuing Theory.” The line queuing theory says if you put someone in line, they will get out of line! Patients will change lines to go a shorter line!

Bottom line:
Don’t put people in line!
If you have so much demand that a line forms, you should raise your prices. Conversely, if you have so little demand that you have excess capacity you should lower your prices, advertise more, or invest in your dental operation. I’ll never forget the day, over a decade ago, when Jim Rhode, the founder of SmartPractice told me in my office, “Why don’t dentists blink at signing up for a PPO with discount fees of over 35%, but the same dentists won’t invest 5% of their money in marketing or new equipment?”

Investing in your dental operation is my second point to this Mayo Clinic dilemma. I always hear small town doctors from the Midwest tell me they can’t afford to go paperless with computers. These dentists tell me their patients would leave if they spent a lot of money going paperless with digital x-rays. They tell me they don’t want to scare off their patients with something hi-tech like a CEREC 3 CAD-CAM, a Diagnodent, or a laser. Then during the winter months, 300,000 snowbirds are telling every dentist and physician in Arizona that if you saw what their hometown dentist’s office looked like, you would understand why they want to get it fixed in your modern office before they have to go back to Bumblebutt, Kan. on tax day!

Note to dentists:
Invest in your dental office until your patients notice!
And just what is it “exactly” your patients want? I was talking to Jim Ferrell today of the Anaheim Group. Jim is an analyst who has consulted for some of the biggest companies in dentistry. Jim has a “Current Patient Satisfaction Audit Report” that he can do for your patients. You might be very surprised on how your patients see your dental office. Read more about Jim’s “Current Patient Satisfaction Audit Report” on page 38 and then call Jim at 714-280-8099. Jim gives new meaning to the old Rolling Stones song,
“I can’t get no satisfaction!”

So, quit moaning about the economy! I don’t want to hear another word about Osama Bin Killed! Don’t even tell me how you want to stop investing in your office since you’re going to retire in five or ten years! Retire to what? A couch filled with Prozac and booze! Shoot me first! Just get your dental office poised for growth! Don’t walk–run to the next level! Make it so that when company comes to town you want to show them your dental office before your home!