Date: March 23, 2016
Solving Your Referral Problem – Podcast
Listen to the podcast here:
Dr. Neilson is a general dentist in a small town in Southern Ohio. His practice, on average, sees 1,200 to 1,500 patients each year. While Dr. Nelson is a very competent general dentist, he often has the opportunity to send his patients on to specialists in the area for advanced treatments. One day, Dr. Neilson took one of his referral partners, an orthodontists, out to lunch, as he often does. Dr. Neilson asked his friend how little Timmy was doing with his braces? Dr. Ortho just stared back at him with a confused look on his face, “Timmy who?” he asked. He then went on to explain to Dr. Neilson that he hears this all the time. That the general dentists who send him referrals will often ask about a patient that he has never heard of, because they never made it to his office. Dr. Ortho was understandably frustrated, as that means that patient is likely $5,000 in revenue that he will never see. Because he wasn’t notified of the referral, he never even had a shot at converting this new potential patient.
This is Mike Green with another episode of the Professional Practice Marketing Moment. Today we’re are going to talk about a problem that exists in many specialty practices we consult with. That is, the problem of referrals.
A recent case study followed three general dentists, and 200 of their referred patients. The goal of the study was to measure how many patients, when given a paper referral card by their general dentist, would find their way to the specialist. The findings, at least for me, were shocking, Nearly 30%, on average, never found their way to the specialist. Let me let those numbers sink in for a moment. 30% percent of referred patients never make it to the specialist. What does 30% represent for your practice? For an average Orthodontist who has 250 new starts per year in their practice, that means they’ve missed out on 75 additional potential starts, or, if we calculate by the numbers, assuming that each start represents $5,000 in total revenue for the practice, that’s potentially an additional $375,000 dollars in missed revenue. The problem gets even worse when you start considering the lost patient referral potential. If you want to talk about return on your investment when it comes to marketing and advertising, I just can’t think of any marketing method that would have a higher return than solving your referral problem.
Let’s take a moment and detail out what the problem truly is with the current referral system. For most offices, they rely on a few different methods for sending and receiving a referral.
- The paper referral. This is, by far, the most common method used by specialists to gain more referrals for their practice. Typically, they will have a referral pad printed up with their contact information and logo, and deliver these pads to the general dentists in the area. I would bet that many of you listening rely on this as your primary referral gathering method. The problem with this method, is that most people no longer use paper as a means for transporting information. The referral card is quickly misplaced or thrown away with the day’s garbage. The other major problem with this form of referring is that the receiving end of the referral, the specialist, usually has no idea that the referral has been issued. Because of this, they have no way of reaching out to that potential patient in order to get an appointment set.
- The second most common way for sending a referral is by fax. Dentistry is one of the few industries where fax machines are still in almost every office. Countless studies have shown the cost disadvantage to using the fax machine as your referral method. From time efficiency to a host of other potential technical problems, faxing is a method that needs to join the ranks of tractor fed printers and massive cube monitors, in the past. The other challenge with faxing is that is usually is not a two way communication. In other words, once the referral is sent, that usually is the end of the conversation.
- The last most common way of sending a referral is by email or texting. I won’t spend time today talking about how non-compliant email and texting are with HIPAA guidelines, but if you are sending your referrals by email or text, and are not using a HIPAA compliant service, you have an issue in your office that needs to be corrected. The challenge with most of these compliant email services is that they are extremely clunky and usually require both the sender and the receiver subscribed to the service in order to be effective. Because there is not one uniform system out there, it ends up being an organizational mess for the general dentist. Because of this, they revert back to the paper referral.
These referral methods are outdated and problematic yet dominate the current referral system used by most dental practices. Most dentists we talk to are spending thousands each month trying to gain more patients, when the reality is, if they could take control of their referrals, they would likely reach their practice growth goals with a fraction of the investment.
Now, you didn’t think I was just going to complain about th e problem and not offer any solutions, did you? Well, of course not. Here’s a list of things you should be looking for to successfully establish your referral system.
- It’s got to be in the cloud. Gone are the days of the paper shuffle. The cloud offers you an opportunity to share the referral with the specialist, real time, with complete accuracy. Most cloud-based systems also provide image and document transfer. This is important when sending along x-rays and radiographs.
- There must be a notification system built-in. When a referral is sent, the referral receiver should receive a notification, by email, text, or both, that a new referral has been sent. The patient should also receive a notification of who they are being sent to and how to get a hold of them. Sophisticated systems will also include driving directions for how to reach the specialists office.
- The system must be HIPAA compliant. Many of you are possibly pushing the bounds of HIPAA compliance with your communications. Be sure that the system you are using is HIPAA compliant so you don’t have those issues down the road.
- The system needs to be easy. We’ve seen many different softwares used for professional practice, and only a few are easy to use and not clunky. We’ve found that if it’s not easy to use, your staff is likely not going to use it. Ease of use, with a smart design should be one of the things you look for when finding your referral system
Remember the cases study I talked about before, the 30% loss in potential patient revenue? By implementing a system like I described above, they saw an average increase of referred patients captured by 17%. Again, let me let that sink in. What would an increase of 17% do for your practice? Now, I’m not going to make any specific endorsements on this show for any particular product. With that being said, I do have some solutions that I would love to share with you in person. If you’re interested, drop me a note at email@example.com let’s talkI want to thank you for listening to the Professional Practice Marketing Moment podcast. We enjoy putting these together for our listeners and look forward to hearing about your marketing success. If you’d like to find out more about Doctor Demographics, visit us online at www.doctordemographics.com