Owning and operating a dental practice requires more than just expertise in the clinical field, it also demands a decent understanding of business finance. If you are new to running a dental office, understanding the ins-and-outs of operating a business will come with time. But it’s crucial you understand these common financial mistakes for the overall health of your business.
1. Not Leveraging Tax Options
No one enjoys filing taxes, but for dentists there are tax credit options that can benefit your dental office.
- The Federal Research and Development Credit (R&D) gives businesses a dollar-for-dollar cash savings for research and innovation products
- Additional First Year Depreciation Deductions allow you to claim depreciation on equipment that was purchased in that tax year
2. Not Looking at Finances Routinely
This may seem like a no brainer, but when you are treating patients and running the daily operations of the dental office, looking at your books may be the last thing on your list. The more you look at and familiarize yourself with the trends at your business, the easier it will be to catch deficiencies in revenue before they actually happen.
3. Not Insuring Your Dental Office Adequately
Like any business, it’s crucial that you are insured against any potential accidents. Insuring your business is also a requirement set by the SBA to be considered for financing. On the other hand, you may be paying for insurance policies you don’t need. The right insurance is necessary to protect yourself, your business, and your assets.
4. Not Understanding Insurance Fraud
Dental offices are especially susceptible to insurance fraud, which can easily lead to lost wages and legal consequences. When a team is handling multiple roles at the same time, it leaves the practice open to gaps in accountability. Other risk factors that leave your practice vulnerable to fraud include lack of formal fraud policy, unrestricted access to accounting systems from multiple team members, and lack of separation between filing billing, collections, and deposits.
By avoiding these common financial mistakes, you can protect your revenue, reduce risk, and create a stable foundation for long-term growth.
Author: Bruno Ceccarelli