HEALTHCARE / SERVICE 01

Active Cash Management for Dental Practices

Dental practices lose margin between production and collection, not between revenue and expense. We build a 13-month rolling cash forecast, a collections dashboard, and a monthly close that tells you what actually hit the bank before the month ends.

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Dental practices lose margin between production and collection, not between revenue and expense. We build a 13-month rolling cash forecast, a collections dashboard, and a monthly close that tells you what actually hit the bank before the month ends.

The active cash management problem in dental practices

Most dental owners measure production, not cash. Insurance A/R ages 60 to 90 days, claim denials sit unworked, and the practice has no forward-looking view of whether the next payroll clears. Reported profit looks healthy while cash quietly tightens because the lag between production, collections, and disbursements is never modeled.

Where value leaks

  • Uncollected production aging past 60 days with no collections workflow
  • Claim denials sitting unworked until they become write-offs
  • Hygiene schedule utilization low because cash visibility into open chair time is absent
  • Owner draws timed to bank balance rather than forecasted free cash flow
  • No rolling forecast, so equipment and expansion decisions are made blind to the next quarter's cash position

What we build for dental practices

A 13-month rolling cash flow forecast built from production, collections, and disbursement timing

A weekly collections dashboard tracking production-to-collection rate, A/R aging, and denial status

A monthly close rhythm delivering real numbers within days, not weeks

A working capital dashboard showing trapped cash in A/R, inventory, and prepaid expenses

A decision framework for owner draws, equipment, and expansion timed to forecasted free cash flow

KPIs this moves for dental practices

  • Collection rate moves toward benchmark as aged A/R is worked down
  • Hygiene utilization rises once open chair time is visible against cash targets
  • Days in A/R compress as denials are worked inside the monthly close
  • Fee schedule realization improves when cash visibility exposes the gap between billed and collected
  • Buyer and exit lens for dental practices

    A buyer or lender scrutinizes collections before production. Clean, forecastable cash flow with a documented collections workflow is the first evidence a DSO or consolidator looks for that the practice is not running on owner timing. Cash predictability directly defends the EBITDA number the multiple is applied to.

    FAQ

    Active Cash Management questions for dental practices

    Why does our dental practice show strong profit but tight cash?

    Because production is booked before it is collected. The gap between what you produce and what hits the bank, driven by insurance A/R and denial lag, is where the cash goes. We forecast that gap so you can see it before the month ends.

    How does cash management affect our practice valuation?

    Buyers pay a multiple on normalized EBITDA, and normalized EBITDA is only credible when the cash backing it is predictable. Forecastable, defensible collections support a higher and more durable multiple than production that cannot be traced to cash.

    Do you replace our dental billing software?

    No. We build the forecast and dashboard layer on top of your practice management system. We tell you what to change in the collections workflow; we do not run your billing.

    More for Dental Practices

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    Start with where you actually stand.

    The Keystone Value Creation Assessment audits your last 12 to 36 months and gives you a written summary whether you engage us or not. If there is not a clear opportunity to create value, we will tell you directly.

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