I received a phone call recently from an associate dentist wondering if he was being paid correctly. He noticed that although his production was higher than the senior dentist, his collection was lower. This seemed to be a trend over the past several months, and he thought it might be worth taking a look.

This associate dentist had a nice relationship with the senior dentist, and he felt good about the experienced office staff as well. He just wanted to see if perhaps something was wrong with the software or the process. Sounded like a good question to me.

After running some reports in their Dentrix software, I found that the senior dentist was overpaid by almost $1 million — while the hygienists were underpaid by more than $650,000. Happily, the associate dentist was owed about $15,000, so he's being paid just fine.

In talking with the experienced front office staff, we agreed that they were entering payments correctly, making sure to pay each provider that was owed money. This put to rest the major concerns of the dentist, but what about the almost $1 million overpayment money?

It turns out that in the past (their senior dentist has been practicing for more than 30 years) payments were made to the dentist only and not to the hygienists. Since this dentist was practicing solo, it really didn't matter how the payments were allocated — all the money was going into the dentist's bank account anyway.

Then, when the associate dentist joined the practice a few years ago, and he was being paid salary, it still didn't affect anyone's paycheck if the office staff entered payments for the senior dentist only. However, as soon as the associate dentist made the decision to buy into the practice and the compensation agreement changed, now it makes all the difference how the payments are entered. Here's an example:

The associate dentist is charged out for a crown he restores for a patient. The payment is entered for the senior dentist, and the patient account will show a $0 balance and no one will ever see that one dentist did the work while another dentist was paid for it. Since most offices seem to run a day sheet to determine collections for the month and then pay the dentist based on that collections number, dentists' pay is affected by how the payments are entered.

If you're wondering how your office is doing on entering payments accurately, run a provider credits report in your software. Hopefully, you don't find that one provider is upside down by almost $1 million.