CDA Members: Evaluating Insurance Contracts — Hourly Profit Statistics
To evaluate the impact of any insurance contract on your business, it is important to know if the most common restorative procedures that you do are truly profitable. Using the forms below to determine your total practice overhead and specifically the cost of providing common services, you can analyze the profitability of various insurance contracts based on their fee restrictions. The following forms are free to download and instructions are included with each form.
It is important to know your hourly practice overhead figure before assessing the profitability of specific procedures. If you do not already know that per hour cost for your practice, start by filling out the Hourly Profit Worksheet — Part 1. Next, use the Hourly Profit Worksheet — Part 2 to determine the time and lab cost associated with providing the treatment. Next, complete the Hourly Profit Worksheet — Part 3.
This exercise should be completed for every insurance contract you wish to evaluate. You can also use this information to evaluate and adjust your standard fees to determine if you are profitable with any service you provide.
If you find that an insurance contract is not profitable and you are unable to adjust the reimbursement amounts (fees allowed) then you may need to decide if the contract should be continued or terminated. If you desire advice in either reaching that decision or creating a process for extricating yourself from an insurance contract with minimal practice disruption, please contact us using the form to the right. We will be happy to discuss your individual circumstances with you.
"Those Delta Blues" as seen in the CDA Update
Hourly Profit Worksheet — Part 1 Begin with this form to determine the cost of running your practice.
Hourly Profit Worksheet — Part 2 Use this form to determine the cost of providing specific treatment.
Hourly Profit Worksheet — Part 3 Use this form to determine the profitability for specific treatment.