The Beacon-Podcasting for Dentists · David Darab, DDS, MS, MBA

Raising Your Fees Without Fear (EP14)

·25 min·2 clips

Why do dentists fear raising fees despite knowing it's essential for their practice's survival?

Philip Clark opens by framing fee adjustment as the most sensitive and emotional subject in dental practice management, noting that most dentists he encounters have not raised their fees regularly, and that this avoidance persists even as their bottom lines deteriorate year by year. The historical overhead data provides the core argument: thirty years ago, dental practices could expect overhead around 45%, leaving a net profit of 55%; today, average overhead is closer to 75%, meaning average net profit has fallen to 25% or less. Clark argues this compression has happened largely through inflation and cost increases while fee schedules remain frozen, not through any reduction in service quality or efficiency. The psychological mechanism behind fee avoidance is examined directly: dentists fear that patients will interpret a price increase as a signal that services are too expensive and will leave. Clark challenges this by citing research showing that patients rank relationship, experience, and atmosphere significantly higher than price when evaluating their dentist. The implication is that a patient who has been coming to the same practice for years and trusts their dentist is unlikely to leave over a modest fee adjustment, whereas a practice that keeps fees artificially low is training patients to expect those fees and making future adjustments harder. The PPO insurance problem is treated as a separate but related issue: when dentists joined managed care networks in the 1970s, they agreed to accept insurance-approved fees. Those approved fees have not kept pace with inflation while overhead has continued to rise, leaving participating providers in some cases barely breaking even on insurance patients. Clark recommends a systematic PPO analysis to determine which insurance relationships are actually profitable and which are not. A less obvious blind spot is raised for dentists thinking about practice valuation: if a practice has kept fees artificially low for years, a buyer will inherit a patient base conditioned to those fees and will face real risk of attrition if fees are adjusted to market rate quickly after purchase — creating a structural problem that suppresses practice sale value.

As heard by us

A practical case for raising fees before overhead quietly cuts into profits.

The Beacon takes on a sensitive question for dentists: whether fees are being raised often enough. Its point is practical, not theatrical. If fees stay flat too long, overhead can edge up and profits can thin out, so the piece pushes readers to know the numbers before assuming…

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Why you'd press play

If you need to raise fees, this gives you the frame.

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