Are Uninsured Patients the Key to Boosting Profitability? – Episode 149

On this episode of Dentist Money™, Reese interviews Dave Monahan, CEO of Kleer. Dave offers his expert take on why uninsured patients are avoiding the dentist because they overestimate the cost of treatment, and how implementing subscription pricing can help overcome that concern. Plus, you’ll hear some surprising statistics on dental insurers’ profit margin, and why cutting them out—when you can—will increase your bottom line.

Podcast Transcript:

Reese Harper: Welcome to the Dentist Money™ Show, where we help dentists make smart financial decisions. I’m your host, Reese Harper, here with Dave Monahan from Kleer. Welcome to the show, Dave.

Dave Monahan: Thanks, Reese! Thanks for having me on.

Reese Harper: Thanks, man, for dealing with the cold I have today! As you can tell, I’m a little bit stuffy, and listeners today, luckily, won’t have to hear me as much as they will get to hear your voice, which sounds clear and straightforward. Did you like that? No pun intended.

Dave Monahan: (laughs) that’s fine. We have that happen all the time. Everyone is constantly saying no pun intended on Kleer.

Reese Harper: Yeah, clear voice. Everyone knows a little bit about Kleer at this point from your background. I’m really excited, because you’re definitely one of the experts on membership programs, and I think you’ll be able to uncover a lot of questions that people have. Tell me a little bit about your experience, first of all in this topic area, which is, why are uninsured patients avoiding treatment plans, or just dental treatment generally these days, and what’s the financial impact for practices?

Dave Monahan: Yes, great question. So, before we even started Kleer, we actually did a lot of market research, and we actually did some focus groups. We’d bring in ten patients at a time and talk to them; we’d bring dentists in and talk to them; we were really trying to understand some of the market. A number of things came out of that to answer your question on the uninsured patient side. What we found was, those patients wanted care, just like the insured patients, and they actually had a lot of pent up needs from an oral care perspective, and they knew they needed care. But they were saying away really for two primary reasons and one that’s related. It was cost, or fear of cost, and then related to that, not having any coverage. And you think about it yourself, if you’re sort of on the outside looking in on something, they were just afraid. And when we talked to them, one had no idea how much things cost, but they always overestimated the cost. So basically, they stay away because they are fearful of the cost.

Reese Harper: And prices aren’t very transparent in dentistry a lot of the time, right? So, is that part of it? You’re talking about people who don’t even come in and visit? Or are you talking about people who come in and visit, and this survey is more commenting on why they didn’t implement treatment that was prescribed?

Dave Monahan: It was both. So, what we learned was that there was a number, about 40% of people don’t go to the dentist every year, and that percentage is much much higher in the uninsured than it is in the insured. So, you sort of had these two camps in uninsured: you had one camp which just stayed away because they were fearful of cost. And they, you know, to your point about how there is no transparency pricing wise, and so we would ask them questions like, “how much does a filling cost? How much does a cleaning cost?” and so on and so forth. And they overestimated the cost by two to four times what the real cost was. So, that opaqueness of price was actually paying against the market, because they were way overestimating.

Reese Harper: Yeah. It does a lot, man. It does big time in a lot of industries. I think that’s a big factor. I know for me, that has been one of the reasons we have tried to be really transparent with our pricing, calculators on our website, and display pricing, because we have people overestimating what it costs to hire a financial advisor a lot as well, you know?

Dave Monahan: Yeah. And what we learned from that was, they would way overestimate the cost. The other was, it developed a trust barrier between the patient and the practice, because not knowing costs, they figured they’re keeping it away for some reason, because it must be really expensive. So, it degraded trust as well. And then, to answer the second part of that, even the patients that were coming in to the practice that were uninsured were avoiding accepting treatment because when they were in that chair, they feel stressed about not knowing the costs and thinking it’s going to be really expensive and not having coverage, so they felt exposed. So they would avoid accepting treatment because of that.

Reese Harper: Yeah, which brings up a point. In my mind, I’m thinking one of the reasons dentists haven’t really had prices that have been established really clearly or disclosed is because there is insurance as an intermediary, obviously, and it’s like— I mean, it becomes a little bit harder to say, “these are my prices” if you don’t really know what you’re going to get paid based on what their insurance reimbursements are going to be. And a lot of people don’t bill the difference, or they are uncomfortable with trying to make up the difference in the UCR and the insurance reimbursements. It’s just a really difficult market when insurance makes up the bulk of the revenue, and it makes it just incentivising for the dentist to really disclose prices, right?

Dave Monahan: Exactly. So, great point. What is pricing, right? What would you even tell the patient what your price is, is it your office fees? Is it some discount off your office fees? Is it the insurance reimbursement rates? Like, what is it? So, consumers don’t care about all of that, right? They’re coming from the outside looking in and saying, “it’s just confusing.” But they’re expecting— given a lot of other industries and how industries have moved— they’re expecting that they can get access to pricing and things are simple when you don’t have really complicated terms and all those things. So, their level of expectation is very different than what I think the market is supplying right now. And so, to answer your question around exposing pricing, we actually expose all pricing to the patient. And by the way, very few actually look at it. What’s more important is that you’re building a trust and that you’re not hiding anything from the patient. So, there were two things that came from some of the work we were doing. One was, affordability of dental care is defined differently in a patient’s mind than probably most dentists think about it. So, they were perfectly happy, the patients that we interviewed, spending $30 a month to get their cleaning exams and x-rays. They thought that was a good fair deal. They thought that was really actually going to cost them $50 or $60 a month. So, for the two cleanings, two exams, two x-rays.

Reese Harper: Okay, let me pause you really quickly on this question and say— like, if you were going to interview ten dentists and you said, “how much money do you need to make in order to provide two cleanings, exams and x-rays, per year per patient,” how many dentists would know the number to give you?

Dave Monahan: Uh, not many. I would say, 10% or 20%.

Reese Harper: So, of the dentists, if you said, “how much do you guys need to make on your— if you’re gonna sell two cleanings and two sets of x-rays and exams per year, how much do you need to make?” You’d say two out of ten would say, “I know that my number is x.”

Dave Monahan: So the issue is, the majority of the dentists are getting reimbursed from insurers, and so those numbers are obviously really low, right? And so, something like 86% of dentists are using their preventive care as loss leaders to get other care in. So, it’s sort of a little bit warped, right?

Reese Harper: Do they know that? Consciously, do they know that, or not?

Dave Monahan: I think they do. Yeah, I’d say they know it consciously. But it just sort of happened, (laughs) it’s not like they wanted to, or it’s under their control. It just sort of happened. And, it’s a shame, right? Think about it.

Reese Harper: Yeah, that’s my experience, man. So, here’s what ends up happening: when you don’t have price transparency— and this is my own experience in a lot of industries— the bottom end of the market ends up getting a smoking deal and way too much value. Meaning, the people who don’t end up paying hardly anything, they get a lot of delivery for not paying a lot. In a service. In a service, or any kind of medical profession, in a lot of cases, the people that don’t bring in a lot of revenue, sometimes they get over-served, because the service provider knows that at the top end of the market there are people that provide three or four times the amount of revenue that— and it doesn’t cost quite as much to service— like, the margins are huge at the high end, and they’re really bad at the bottom end, but it kind of just works itself out in the middle. If you can kind of establish a way to not lose your shirt at the bottom (laughs), you know, and create some kind of minimum agreement of what you can earn from your service, I mean, it makes all the difference in the world in how your financials look!

Dave Monahan: Oh, yeah. And we go through financials with dentists all the time, so, maybe I’ll ask you a couple of questions, because it will be interesting to see if you know and if some of the dentists on the podcast no. So, any idea how much— because this is a core of the problem— any idea how much revenue the dental insurers pull in on an annual basis?

Reese Harper: Like, nationally? Like, the total gross revenues?

Dave Monahan: Yeah, in the US. Because this is going to get to the exact problem you talked about.

Reese Harper: I would say it’s billions, but I don’t know how many billions. I would say billions, but I don’t know how many.

Dave Monahan: Yeah. 75 billion a year (laughs).

Reese Harper: Okay (laughs). I wouldn’t have thought quite that high.

Dave Monahan: Guess how much—

Reese Harper: How much goes to the dentists?

Dave Monahan: Yeah.

Reese Harper: I mean, it’s gotta be like a third or somewhere are there. I don’t know.

Dave Monahan: Yeah, 40%.

Reese Harper: Okay! So, good. Alright. So, twenty something billion goes to the dentist. 30 billion maybe.

Dave Monahan: Yeah. How much drains to the insurer, right? It’s almost all the revenue in the market. Think about that, right? Now you have— as you sort of described— the low end is basically the patients coming through insurance, right? That’s where the dentists are getting the worst fees. And they have to swallow making any money on 86% of their procedures. The math doesn’t work!

Reese Harper: Yeah, that’s like the whole market. And the hard part is, they get a similar experience to— they’re still getting access to care. They’re still getting access to your team, your facility, like, all of the value you’re providing. They’re just not really paying the same proportionately as people who have a lot of treatment needs, you know? So…

Dave Monahan: And then think about it on the consumer side for a second. So, the consumer, typically with subsidies from their employer, do pay a lot for dental care. On average, just so you know, a consumer is paying about $500 in premiums for dental insurance. So, there’s all this money sloshing around the market, it’s just not getting to the dentists. So, that is really the core of it.

Reese Harper: I mean, 60% of it is wasted! Like we just said, it’s wasted in administrative intermediaries, right? It’s just like a big giant credit card. Instead of charging 2% like PayPal or Amex, it’s like, we charge 60% on— that’s what dental insurance is. It’s a giant credit card that charges 60% to use it (laughs).

Dave Monahan: Think of membership plans as, that all goes away. Right? That whole machine goes away. Why can’t dentists interact with patients directly? In this day and age, right? In 2018—

Reese Harper: Because pricing is hard. Marketing and pricing is hard, it’s so hard! So, that’s where you are coming in to help a little. But, it’s one of the hardest things to do, man! Developing a pricing schedule that actually is profitable for you based on your market, your region, your area? Like, in the services, and limiting the scope of what you’re going to commit to. I mean, it’s definitely challenging. That’s why I think guys like you are in business.

Dave Monahan: Exactly. And we actually do a consultation with the practices, and we talk to them about their fees, and what they should charge, and we give them comparisons to benchmark by zip code for their offices. So, that’s actually where we start is to understand where they are. And by the way, a lot of practices end up raising their rates, because they start to realize they haven’t raised them in ten years, and they have been beaten down by the insurers. And there’s no reason to let the insurers set your rate. You should set your own rate based on the competitive atmosphere you’re in. So anyways, that’s absolutely where we start. We say, “okay, let’s take a look at your fees. Let’s see what you’re doing. Let’s see if we should make adjustments,” and then figure out what the fee schedule is going to look like and charges for the membership plan and things like that that come out of that.

Reese Harper: So, let’s just take an average 2,000 patient-based practice. Let’s just say we have 2,000 active patients, and they’re all going to pay some sort of a monthly charge. Every analysis that I’ve done, like, dumbed-down, back-of-the-napkin math— I don’t know a lot about membership plans. I’m not an expert in this area. That’s why you’re here. Like, this isn’t my cup of tea. But, when I do the dumbed-down napkin math, I’m like, I can charge not a lot— I mean, I know you can’t offer insurance, and there’s all kind of rules and regulations that limit dentists currently from providing insurance, but man! It just seems like 2,000 people is a pretty big pool of risk that I could spread my costs over and kind of take some kind of guesses at what I think usage is going to be like. And man! It feels like I could make a lot more money if just all those people stopped paying 500 bucks and just paid me the 500 bucks. I mean, it’s a fair amount of revenue, you know? But, I don’t know if the average person actually pays the $500 is the problem, and their employer is usually paying it, and that’s where it gets sticky. You tell a patient— I mean, it gets a little trickier when someone is writing the money out of their own paycheck versus their employer paying for something, right?

Dave Monahan: So, per dentist in a practice, typically there is about 1,200 patients per dentist. And it could be above that, it could be below, I’m just using averages. And in that 1,200, there is typically about 400 or so uninsured patients, and that’s where we tell practices to start. Just start with your uninsured patients. A lot of times, we’ll do an analysis for practices, but it’s amazingly consistent. So, what the analysis shows is that their uninsured patients come in on average about once every two years, alright? Their insured patients come in on average about 1.4 times a year. So, it’s about four or five times difference between your insured and your uninsured. And Reese, practices will swear up and down to me that that’s not true in their practice, and I’ll get their data, we’ll analyze it, we’ll give it back to them, and it’s almost exactly that (laughs). It’s amazing how consistent this is.

Reese Harper: So, 1.4 times per year typically for the insured, and—

Dave Monahan: .5. So, once every two years for uninsured. And they accept half the amount of treatment. So even when they’re in the chair, they’ll accept about half of what an insured patient will accept. And it comes back to what I originally saw. They’re fearful, and they’re afraid of costs.

Reese Harper: For sure! I mean, you’re like, “well, my insurance is probably going to cover some of that, so… okay. Or maybe it’ll cover all of it!” You wonder. You’re always so surprised about how little they cover, but you assume they’re going to cover something. So, yeah (laughs). Just back to your original question there. Let’s just say the average dentist has 1,200 patients. What would you assume the average— like, when you see the average dentist, what is the average collections roughly that you’d say, “hey, this is what I think is the average.” Because there’s a lot of data out there. I’m just wondering what is an average collections amount that you’d say, “this is the average dentist.”

Dave Monahan: So, let me give you the numbers that I have, and they’re pretty close to national numbers I’ve seen. But these are actually from practices that have implemented Kleer, and I have full access to their data. I’ll give you an example, which is very similar to what we see across the board. So, an insured patient will come in about— like I said, 1.4 or 1.5 times a year. They’ll accept about seven procedures— and that’s the cleaning exams and stuff, and a filling, or whatever. And a typical practice will make about $800 of net revenue from that patient. An uninsured patient will come in about once every two years. In the year they come in, they’ll accept about four procedures, and the net revenue to a practice will be about $400 or maybe $500 dollars. So, it’s roughly half of everything from the insured. What happens though, the beautiful part about membership plan— and this is from real data— the membership plan patients come in and accept the same amount of procedures as the insured patient, okay? So, they act just like an insured patient. But the practice gets the subscription payment, right? Not the insurer. And the practice controls the fee schedule, so they actually get paid higher per procedure. So, the net revenue to a practice is typically about $1,100 for a membership plan patient.

Reese Harper: Okay. And this is based on the data that you have for your practices.

Dave Monahan: For our practices, exactly.

Reese Harper: So, if I have 1,200 patients, you’re saying 400 of them are going to be uninsured, typically. So a third, is that what you’re saying? A third of my patients typically are uninsured.

Dave Monahan: It will be between 300 and 400, yeah.

Reese Harper: Okay. And you’re saying on average that those $400 people only give me like 500 bucks a year in revenue, basically. On average, I get about 500 bucks out of them.

Dave Monahan: Yeah.

Reese Harper: But theoretically, if they were on a membership plan, you’re saying on average, I’m generating around $1,100. So, I mean, I’m going to go from 200,000 in collections to pushing 450,000 a year in collections. I mean, I just got a $250,000 raise. What’s the net effect to the patient? Like, how does the patient perceive this from your experience?

Dave Monahan: The patients love it. Those uninsured patients know they need more care. They know it, and they want it.

Reese Harper: Yeah, they know they’re neglecting it. They know they’re just being bad (laughs), right? They know.

Dave Monahan: They know it. Yeah. So that’s what became really clear when we were doing our focus groups and our interviews is, they wanted it, but they also—

Reese Harper: (laughs) they’re just feeling guilty about it when they’re getting interviewed. I can see it, like, “yeahhh, I only go in once every couple years, and only if they hound me and are finding pain.” That’s the thing! Like, people want treatment. They want help. They want it! Sometimes, we’re not asking for it, and we’re not offering it! We’re just assuming they’re going to volunteer to start paying us. But they want the help.

Dave Monahan: Yeah, the dentist community as a whole has trouble selling. And I get it, and I understand sort of that perception of selling. But this is just uncovering needs that the patient has that they want to fulfill. And so, if you talk to an uninsured patient, once they’re on a membership plan, or if somebody bought them insurance, whatever, once they have coverage, now they’re really open to the conversation, and they feel like they’re getting a deal, right, and they’re on the inside now. They’re in the other side of the rope. They’re not looking from the outside in, and so they’re much more comfortable and trusting in their acceptance of treatment. It’s amazing. It’s psychological. And what I tell people is, membership plan isn’t just a planned document that gives them things, it’s a feeling. I actually tell the practices we talk to, “treat these members like they’re your best patients! Shake their hands. Look them in the eye. Thank them.” Some practices even give them little gifts. Like, make them feel comfortable, and that you’re on your side, and that you are very trustworthy, and they can trust you any time they come into the office.

Reese Harper: Yeah. I like it. So, let’s say of that person that we had an example of 1,200 patients, we had 400 uninsured, we bring in only 200,000 of collections maybe to where maybe we can bring between 450 or 500 on those same individuals, what is the assumption you’re making— I’m not saying this is your math, I’m making this math up. But like, what’s the assumption that you’re making in how I’m going to charge for my membership plan for an average dentist? In that scenario. How many of the fees are going to come from treatment? How much is going to come from the plan?

Dave Monahan: So, the plan itself, the average— I’ll just give you all our averages— the average on our platform is $350 dollars a year is what patients are paying for their two cleanings, exams, x-rays, you know, sort of the standard recall stuff.

Reese Harper: Is that because people are keeping it in the $20 range, or right below 30, or right at 30, or what’s the advice, you know?

Dave Monahan: Yeah. So in our market research, it showed maximum acceptance is between $20 and $30 a month. As you go over $30 a month— and by the way, that doesn’t apply to perio patients. Perio patients are paying $40 to $50 a month without any issue. This is only for standard patients.

Reese Harper: Yeah, my wife is a super proactive perio treatment, right? And so, I’m always surprised at her tolerance for proactive dental care. She’s dragging me in with her, you know? But I think that’s a— do you recommend people offering the premium service where it’s a little bit more proactive like that?

Dave Monahan: Absolutely. So, we have templates on the platform that practices can deploy, and they can pick and choose which ones they want to deploy, and typically, we’ll say, “you have three plans as a basis: one for children, one for standard adults, and then one for perio patients.” And that pretty much covers 80% of the population. We can do some customization stuff on the side, but those are the three you really want. And just again, on average across the platform, 20% of the members on our platform are perio patients. And that’s actually pretty close to what the national average is of just general perio patients.

Reese Harper: Interesting. 20% of all patients are perio patients. Does that require a lot of education for them to elect that option, or what kind of general education is required for people to pick a more proactive treatment like that?

Dave Monahan: So what typically happens is they have either already come into the office that they’re going to buy the membership plan for, or they were being treated somewhere else and they know they have gum disease or gingivitis or periodontal disease, whatever it might be called. And when they go to sign up on the app— they can sign up from any device— but in the app, it asks them that question. Have you been diagnosed with gum disease, gingivitis, or a periodontal disease? And if they answer yes, we give them the periodontal plan. If they answer no or I don’t know— if they say I don’t know we assume they don’t have it— we give them the standard plan. If they go in to the practice and the practice says, “actually, we need to change your plan,” it’s very easy. We just change the plan to the plan they need.

Reese Harper: That’s interesting. So ultimately, you find that that’s a price point— like, if we’re getting between $300 and $350 per year, then that additional $700 or $800 dollars a year is coming from treatment from those uninsured electing to now participate. How are you positioning the value of the treatment?

Dave Monahan: When a practice sets up its membership plan, they set their subscription, but then the next step is to set their office fees for the membership plan, and basically, they can set a flat discount across all their fees, or they can discount by procedure category— so, those eight or night categories— so they can give a different discount for implant services if they want, and they can exclude too. If they don’t do orthodontics, they can exclude that category. There’s all kinds of setup options. And so that’s where that fee schedule comes from. Typically, again, average wise, the practices are using their standard office fees. They upload that into the platform, and the average is about 20% discount off of those office fees is what they offer. And by the way, the market research shows— 10% is fine. There’s nothing wrong with it, but if you really want to get people interested, generally, you need to be at 20%. That’s where people start to pay attention to discounts.

Reese Harper: Interesting. Why do you think that having the membership plan increases the likelihood that patients are accepting more procedures? Because that is what you are saying is like, these patients are now— I’m trying to remember all your numbers. You threw in a lot of great numbers with us today. One of them was, we had four treatments accepted for uninsured people per year per visit, and it was like seven or eight for the insured people?

Dave Monahan: Yep.

Reese Harper: And then, it was higher for the people that had membership plans, correct?

Dave Monahan: The membership plan was just about at the insured level. Just a little bit below insured. But the revenue is higher, because you’re getting paid the subscription.

Reese Harper: Oh, okay. So, they were accepting the same number of treatments on average.

Dave Monahan: As the insured, exactly.

Reese Harper: Okay. But then, you’re just adding that additional revenue that you got from the membership plan as opposed to losing it to insurance, which you would have taken a similar discount on your UCR anyway.

Dave Monahan: Or more, yeah.

Reese Harper: More, probably, in many cases, twice as much.

Dave Monahan: Exactly. So you do the simple math, right? I’m getting paid the subscription and rather than giving a 40% discount, I’m giving a 20% discount. And here’s the amazing part. Not amazing, but you think about it on the other side, on the patient’s side. The payment is less into the membership plan! The patient pays less, and the dentist keeps a lot more, right? We’re basically getting— remember that drain I talked about, that 30 or 40 billion dollar drain? That’s what goes away. Instead of that going into the drain, it goes into the dentist’s practice.

Reese Harper: Tell me about the difference between kids and adult costs. So if I have a child, what’s a typical recommended schedule for a kid?

Dave Monahan: It’s still two per year. Well, I should say, it varies.

Reese Harper: I guess the pricing, I should have said pricing. I’m sorry.

Dave Monahan: Yes. The pricing that we typically see on the child plans, it can range a little bit, but they’re fifteen to mid twenties. 24 or 25. Depending on the practice’s zip code. Like, New York City is going to be more expensive than Provo, Utah, but think 15-25 or so per month.

Reese Harper: So do people generally lose money on children, or is there a similar profit level at a child as there is in the standard adult, or is that something that’s hard to measure?

Dave Monahan: It’s the same. It’s basically the same level of profit margin. It’s usually less revenue, obviously, because the children don’t need as much work.

Reese Harper: Yeah. And so, you’re not losing your shirt in a disproportionate way. I mean, there’s the same amount of profit.

Dave Monahan: Oh, not at all. It’s the same, yeah. So, it works exactly the same way. So you’re keeping the subscription. It’s just less, because you’re doing less work, and the treatment, you control the fee schedule just like you do with an adult. So it’s all the same. It’s just less scale or whatever. You know, they just spend less.

Reese Harper: It just seems to me like you’re still taking up chair time, you’re still taking up— I mean, it’s still staff, it’s still overhead. I just wonder if that drags a practice down, or if it’s like a restaurant that offers a $7 kid’s meal or a $4 kid’s meal. They know they’re losing money on it, but it’s like, “if you don’t have a membership plan for my whole family, I’m not gonna come in.” And I can’t imagine paying the same amount for an adult as for a kid. Like, in my head, that just doesn’t make sense. But in reality, I’m not sure it’s actually a lot cheaper to treat a child. I mean, it is a little bit, but I don’t know if it’s substantially less. And so, I just wanted some perspective on that.

Dave Monahan: Yeah, I think you have a good point. I’m not an expert on that. But think about it, right? All your fixed costs are the same. You still have the building; you still have the equipment. I think the difference may be— just based on my experience with my kids, I have three of them— I think they’re usually in and out faster.

Reese Harper: Chair time is quick, right? Chair time is just quick. Yeah. How many of your GPs do you find are— like if you look at the three membership plans, you said that there was 20 that are electing perio. What’s the ratio of standard adult to kid?

Dave Monahan: Oh, it’s almost all adult. I’d say with what I have in front of me, I think it’s about 70% adult, 20% perio, and 10% kids.

Reese Harper: Okay, yeah. What about husband and wife discount, or any kind of couples discount? Is there any couples discount?

Dave Monahan: By the way, the practice sets all these rates, we don’t. We just provide the platform. But there’s an option—

Reese Harper: Of course. I don’t want to make assumptions, that’s the case. You’re being very generous helping me broadly generalize this so people can think of it in a little bit more concrete way (laughs). Remember people, these are not your fees that you would charge, alright?

Dave Monahan: There’s an option on the platform where the practice can decide to give an extra discount if you add multiple family members. So, it can be a couple, it can be a kid you’re adding to your plan, and each plan that’s added after the first one, you can add a discount. So, you can get a 10% discount off the subscription, or a 20% discount for each additional plan added to yours.

Reese Harper: Okay, I have one more question for you. These are way out of the blue, but I like that you’re able to respond to them. What about premium services? You know, like, what things can a dentist do that pushes that membership program up to a really different kind of level? Are there services that you have seen practices implement that are kind of in that premium category where it’s like— we’re not charging $50 a month, we’re charging like 200 bucks a month. We’re charging 150 a month. We’re charging at least 75 a month. Is there anything that pushes people to be able to offer a different level of service?

Dave Monahan: We’re on the cusp of that. So, we’re actually going to be releasing a new version of our platform in about three or four weeks that enables a dentist to create any type of customized plan they want. And let me tell you which ones we’re thinking through right now and the types that I think are going to show up. From a premium perspective, for a lack of a better term, some practices are going to be able to offer a VIP program where you get whitening, right? You get whatever. You get whatever you need to keep everything crystal clean and beautiful in addition— so like, cosmetics.

Reese Harper: See, I would pay for that!

Dave Monahan: Exactly. So, they’re thinking through a package like that. And other packages other practices are thinking about, like an invisalign or a straightening plan. So, in addition to your standard care, you’re now in an invisalign program that is paid for through the subscription. Another is home products. So, “I’m going to bundle up a set of home products for you, and use these in between your visits, and when you come back, I’ll replenish them.” Those are the types of ideas, and we’re going to be able to do that on our platform fairly soon. By the way, there are other services people are thinking through as well in addition to this.

Reese Harper: It would be cool to see those. Cutting edge!

Dave Monahan: Yeah. And just think of it as sort of the consumerism of dental care. There are needs out there. You know, people are walking around with their teeth and their smile every second of the day. That’s a place where you can add a lot of value, and differentiate, and give different people different things, and it just hasn’t been done yet.

Reese Harper: See, my wife gets these regular— I don’t know, I’m going to show my ignorance here, and the audience can laugh at me. But there are a bunch of oral hygiene kind of total oral health, like, washes, and she does a lot of stuff with oral hygiene that I don’t understand completely, but I know to her it’s like a huge deal. And she pays premium for that. In deep metro markets where there is a lot of consumer diversity, there are these Whole Foods corners, there’s the Natural Grocers corner, and if you can accommodate that market, in my mind, it’s like— my wife right now is driving an hour. An hour, dude, to her dentist. Like, three times a year! Just because she’s resonating with this amazing dentist that she loves. And I think she’s doing a great job! This dentist is.

Dave Monahan: Think about— so your point, you’re absolutely dead on in your point. Think about when you walk outside the dental office and go into an aisle, right, at Whole Foods, or at Giant, or wherever you might go. There is now— there’s whitening toothpaste. There’s sensitivity toothpaste. There’s natural toothpaste. People are already buying these things outside the office, right? Why wouldn’t they buy in the office? And I’ll give you the answer, they absolutely will buy it in the office if it’s packaged and sold to them and they understand the value. They will absolutely buy. So, you’re absolutely right. That’s exactly where things are headed.

Reese Harper: Like I’m just telling you, if you explain to my wife for five minutes the difference between the composites that she could use, and if there were different chemical compositions to those composites and one cost twice as much, she will pick the most maximally healthy option. She has very low price sensitivity around health, okay? And I’m just surprised. That is a place to innovate for sure in today’s market.

Dave Monahan: Think about it. If I had a patient in a chair, and let’s just say they’re middle income, and we have a choice. I can put an amalgam in your mouth. And if they ask me, “where does it come from,” and I say, “I think China. Or I can give you a natural inert substance that came from Maine,” right? Think about the difference in your mind sitting there in a chair. Right now, they just say, “well, what does the insurance pay for?”

Reese Harper: “Whatever, doc! I dunno!” (laughs) yeah, just describe that to me! What you just did is you described the two options I have, and I’m like— I just like the sound of one better than the other, you know?

Dave Monahan: Yeah, yeah. And it’s going in my mouth for my life, right? I don’t think I want an unknown metal coming from China in my mouth.

Reese Harper: Yeah. Anyway. Well, this has been a great conversation, man! I really appreciate it. Give me some of your final thoughts here that we leave with the audience before we let them go.

Dave Monahan: I think the final thought is, it’s sort of time to start moving and start taking control back, and I think membership plans are one way to start doing that. Obviously, we talked about a lot of other things, and there are other things that need to happen over time, but the first step is start taking control of your uninsured patient base and then we can move from there.

Reese Harper: Yeah, that’s great advice, man. Well Dave, you’re doing great work out there! We really appreciate you coming on and giving us some insight into this important issue, and we look forward to seeing Kleer continue to have success and help people implement membership plans in a way that really helps them and their patients. Thanks again for coming on, and we look forward to having you again soon.

Dave Monahan: Great. Thanks for having me, Reese! I really enjoyed it.

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