Recently, another one of our clients came to us feeling frazzled and frustrated. They were working hard, making comparatively little money, and dealing with both rising bills and staff constantly on the verge of a pay-related mutiny. During the conversation, this client asked: should I walk away from my NHS contract and privatise?
If you’re servicing NHS patients, you may well wonder the same. The challenges of this realm can feel suffocating, especially for dentists, who are fundamentally born craftspeople, rather than businesspeople. There’s nothing wrong with this – after all, turning your craft into your business doesn’t automatically endow you with the manifold niche skills you need to make it thrive.
Within the confines of an NHS contract, it’s even tougher. Here, volume and throughput are a truism, so you’ll need to see as many patients as possible, every single day. An added spanner in the works can come from the fact that it’s harder to find clinicians who are happy to work in this high-volume environment. And that’s not all. There are many other issues with NHS contracts; in fact, I’ve been foreshadowing these problems for over five years. In contrast, a well-run private practice can treat a lower volume of higher value patients, with dentists providing the level of care that they’d really like to. They’re also likely to find it easier to hire staff.
Put this way, it’s easy to see that moving from NHS to private dentistry marks a clear change for the better. The sticking point, however, is that many dentists baulk at throwing away something they believe they’ve bought. In this post, I want to really dig into this misperception, because the truth can be a liberating thing.
If you’ve bought a practice with an NHS contract, you might think that you’ve bought an NHS contract. In this light, it seems completely wrong to metaphorically rip it up and walk away – wouldn’t that be like ripping up, say, £500,000? Why would you ditch something you’ve paid good money for?
The truth is that many dentists misunderstand what they’ve bought in the first place. If you buy a practice, you’re buying its culture, its members of staff, its trading momentum, and its premises and equipment. As part of this package, you’ll also get the NHS contract, but only because this contract is part of the business. The oft-overlooked difference is that it isn’t the business itself. Granted, by buying a business with an NHS contract, you’ve chosen to take a certain brand position – in this case, a high-volume practice – but this doesn’t mean you have to hold it forever. This really is your choice; not an integral part of what you’ve purchased.
Another common misconception is that an NHS contract has value because it represents a “guaranteed income”. In reality, there’s nothing guaranteed about your income, as every penny depends on you being able to fulfil the terms of the contract. The NHS may agree to pay you £500,000 a year, but this money is conditional on you servicing c.17,000 UDAs. If you’re not able to achieve this (if, as I mentioned earlier, you’re having issues with hiring clinicians), the money you’ve received will be subject to clawback.
What I’m here to say is that it’s perfectly ok to walk away from your NHS contract. It doesn’t hold any intrinsic value, and it doesn’t “guarantee” you anything, in terms of patients or money. As a skilled professional, you’re still the one treating patients when you open your doors every morning. It makes no difference if you’re earning £500,000 from the NHS or the same amount from patients paying for themselves. In fact, if you manage your private practice carefully, your numbers (and your stress levels) are far more likely to improve.
Anecdotally, I can say that 100% of our clients who privatise are happy with their decision. I’ve never yet met with someone who’s expressed regret for making the change, however nervous they may have been to begin with. All it takes is some thought, consideration and planning to make your new private practice a success (a great example of this is Runeel from Oh My Smile, who was able to convert his practice from 80% NHS to fully private, and feels fantastic about the change).
Of course, I’m not suggesting that you simply rip up your NHS contract, sit back, and relax. The best plan is to de-risk the transition as much as possible, so that the outcome you can expect is positive. To do this, you need to shift your marketing proposition so that payments no longer come from the NHS (on behalf of patients) but direct from your patients. You will find that a proportion of your existing NHS patients would be willing to pay privately to remain with you.
So, how can you go about it? Appraising whether privatisation is worthwhile is a straightforward process. All you’ll need to do is use Hive or a plan provider (such as Patient Plan Direct) to judge exactly what should happen next. Yes, this represents change, and change can push us out of our comfort zone, but you’re not demolishing what you’ve built – you’re just changing how you see it. This total change of perspective (what Dan calls the Dancing Queen moment) can open up an entirely new world for you and your practice.
We can easily carry out a strategic review and analysis to find your best way forward. Our team is here to help whenever you’re ready to take the first step: just get in touch to talk to us.