3 Steps to Stop Cash Flow Leaks in Your Dental Practice

Cash flow is the lifeblood of your practice—yet too many dental offices are unknowingly losing thousands of dollars every year due to inefficiencies, missed collections, and unnecessary overhead. If you’re struggling with cash flow leaks, high A/R, or unpredictable revenue, you’re not alone!

The good news? Fixing cash flow leaks doesn’t require drastic changes—it just takes a few simple adjustments. Here are three proven steps to tighten up your financial systems and keep more money in your practice.

Step 1: Strengthen Your Insurance & Collections Process

One of the biggest cash flow drains in dental practices is delayed or lost payments—whether from insurance claims or patient balances. To stop this leak:

• Run a Collections & A/R Audit: Look at your last 6 months of production, collections, and outstanding A/R. If your collection percentage is below 98%, it’s time for a change.
• Submit Insurance Claims Within 24 Hours: Claims should be sent daily, with all necessary attachments (x-rays, narratives, perio charts, etc.) to avoid rejections and delays.
• Collect Patient Balances at Time of Service: Train your front desk team to ask for payment at check-in or check-out instead of chasing balances later.
• Follow Up on Unpaid Claims Weekly: Don’t let 90-day+ insurance claims pile up—track them every week and follow up on denials immediately.

Many practices see a $50,000+ cash flow improvement simply by tightening their collections process!

Step 2: Reduce Overhead & Eliminate Unnecessary Expenses

Unmonitored expenses can silently drain your profits—but small tweaks can make a big impact.

• Audit Your Practice Overhead: Look at your profit & loss (P&L) statements and break down expenses by category. Are you overspending in certain areas?
• Negotiate with Vendors: Supplies, labs, and credit card processing fees can often be reduced if you negotiate or explore alternative options.
• Cut Unused Subscriptions & Software: Just like personal finances, you might be paying for services you no longer need. Evaluate and eliminate anything not actively benefiting your practice.
• Set a Supply Budget: A good rule of thumb is to keep supply costs at 4-5% of total collections. Assign a team member to track and stay within budget each month.

These small adjustments can add up to thousands in annual savings!

Step 3: Optimize Scheduling to Maximize Production

If you’re constantly feeling busy but not profitable, your schedule might be the issue. Make sure your production goals align with your available hours.

• Implement Block Scheduling: Structure your schedule so high-production treatments (crowns, implants, etc.) are placed intentionally rather than scattered randomly.
• Track Open Time & Cancellations: Look at unused appointment slots and implement strategies to minimize last-minute cancellations and fill gaps efficiently.
• Set Monthly Production Goals: Calculate what you need to produce based on your overhead and track your progress weekly.

When one practice optimized its schedule using these strategies, they increased production from $2M to $3.5M—without adding more hours!

Stop Losing Money—Take Control of Your Cash Flow Today!

Managing cash flow doesn’t have to be overwhelming. By tightening collections, reducing unnecessary expenses, and optimizing your schedule, you’ll see a noticeable difference in your practice’s financial health.

Want help identifying cash flow leaks in your practice? Our team at the Dental A Team specializes in optimizing systems, increasing profitability, and helping dentists run smoother, more profitable practices.

Schedule a complementary 60-minute Practice Assessment with us today to discover your practice’s growth opportunities!

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