So overall, what are some things we should be aware of in 2024?
Ken Runkle: First, inflation is real and shows no signs of abating for the next 1-3 years. If you have not set your fees for 2024, that is the first thing you need to update and should have gone into effect January 2. The CPI is estimated to be up about 4% over the last twelve months and if your fees haven’t been adjusted accordingly, you’re essentially losing money.
What about doctors who are in a lot of PPO’s?
Ken Runkle: I have a lot of people who say this to me: “Why would I raise my fees if I’m in PPOs because it really doesn’t matter?” To this I’d say, it does really matter because it shows how much you are losing.
There is a misconception now that Paragon is all about getting out of your PPOs, but nothing could be further from the truth. The truth is, Paragon is all about making sure it works for you.
If your practice is 80% PPOs, that means you only raised fees on 20% of your patients. With only 20% of your fees increasing, you’re missing out on a huge opportunity for growth.
What do you say to doctors who are still reluctant to raise their fees?
Ken Runkle: Over my 40-year career, I really try to listen to my clients.
I had a meeting several years ago where my client said, “don’t touch this one subject” and I lost a valued relationship over it. So, you can imagine what it’s like to hear a client now tell me that we’re not going to talk about setting fees, knowing that we must. My client told me that his staff had already took a vote and determined that they collectively did not want to raise fees.
During our next consultation I asked the staff to take another vote on raises. When I asked by show of hands, every staff member voted that they would like to receive raises next year. After voting in favor of raises, I explained that it is mathematically inconsistent to expect raises without also raising fees. Suddenly the vote on raising fees became unanimous.
As a business owner and leader, you must make sure that you’re prioritizing taking care of your practice and your team which means you simply cannot afford to opt out of raising fees.
Speaking of growth, what kind of numbers should we be striving for this year?
Ken Runkle: At Paragon, we’ve been teaching our doctors for a while now they should move from The 7% Solution™ to The 10% Solution. Growth is still needed, and unfortunately the old days of growing 5-7% are over.
That sounds ambitious, what if you don’t want to grow your practice by 10%?
Ken Runkle: Well, of course you don’t have to do anything, but it’s for your own financial success and independence that we recommend taking the 10% solution seriously. For most of the dentists that we have worked with in The Paragon Program™ over the last 35 years, their dental practice – and their dental building if they own one – is a significant part of their investment portfolio.
So, when people ask me why practice growth is so necessary, I merely point out that it is to help them retire with financial independence.
What would you say to doctors who are worried about achieving their goals this year?
Ken Runkle: I think America’s malaise is a little bit real. I’ve lived through this before; I’ve lived through high interest rates, and I’ve lived through political polarization. I can tell you that despite all of that, I’ve watched America bounce back from worse things before. It may be tough, but if you’re disciplined with your practice and take intentional steps to stay ahead of inflation, I know that every Paragon doctor can achieve profitability this year. Year 2024 is a year for continuing your success.
Go for it!