Finance the Program

Obtaining funding is an important step to starting your program and sustaining it over the long term (see the Ensure Sustainability section for more details). Throughout the financing process, delivering comprehensive services and achieving financial sustainability, in other words having enough short-term and long-term financial resources for continued program operation over multiple years or even decades, might involve tradeoffs. Developing a budget and a business plan—with support from an experienced partner, if necessary—can help ensure that you secure the funding you need to balance your mission with your financial goals. In addition to guidance on budgeting and business planning, this section contains tips on how to obtain the funding necessary to operate your program. Financing involves these three primary features.

  1. Develop a budget
  2. Develop a business plan
  3. Secure necessary funding and resources

Develop a Budget

Developing a budget is an important first step in financing your program. A budget formally tracks your financial goals and might be required for grant applications or other funding requests. Your budget should include both income and expenses. Income sources might include client service revenue—money collected as self-pay fees and from insurance claims—as well as external funding (e.g., grants, donations). Expenses should include upfront and ongoing operational costs, recurring and, therefore, for which you can plan. As described in the National Maternal and Child Oral Health Resource Center’s Financial Management for Safety Net Dental Clinics curriculum, operating budgets outline financial goals for the coming year, whereas capital budgets plan for the purchase of major capital assets, such as equipment or property that requires a large initial investment but should enable operations over a series of years.

Outline Expected Income

  • Determine whether you’ll gain income through client service revenue (e.g., Medicaid or Veterans Affairs reimbursements for services, client self-pay); alternative, external income sources (e.g., public and private grants, donations); or both. Research these revenue sources and their respective billing and collection processes. For an example, see Module 3 of the National Maternal and Child Oral Health Resource Center’s Financial Management for Safety Net Dental Clinics curriculum.
  • Separate self-pay clients into three different fee schedules, or tiers: full pay, sliding fee, and minimum fee. Sliding fee and minimum fee payment tiers offer greater flexibility to clients with low incomes or no dental insurance.
  • Estimate client service revenue based on the expected number of client visits and the average reimbursement rate per visit. For more information, see Chapter 3 of the National Maternal and Child Oral Health Resource Center’s Safety Net Dental Clinic Manual.
  • Estimate alternative, external income sources, such as grants and donations. See the Secure Necessary Funding and Resources subsection for more information on how to appeal to these funding sources.
  • Account for the effects on income streams caused by scheduling, lack of transportation (e.g., missed appointments), and billing and collection systems. Properly designing these systems and planning for implementation can minimize losses. See the Implement the Program section for more information.

Outline Expected Expenses

  • Estimate your program’s upfront, or startup, costs. Potential upfront costs include facility construction and purchase of large dental equipment, supplies, instruments, and office equipment.
  • Consider used or donated dental equipment to reduce upfront costs, keeping in mind equipment life and safety. See Module 3 of the National Maternal and Child Oral Health Resource Center’s Financial Management for Safety Net Dental Clinics curriculum for more information.
  • Estimate and account for salaries, maintenance, insurance, and other routine operating expenses. Budget for other expenses, such as benefits (e.g., health insurance, paid leave) and employer contributions to payroll taxes.
  • Minimize administrative expenses to only the costs that help keep the program functional and support clinical goals. Administrative expenses should generally represent only 10 percent to 15 percent of the total budget.
  • Factor into your budget all of the costs of health information technology (IT), including tangible costs (e.g., hardware, software, facility modifications) and intangible costs (e.g., staff time, training, learning curve). See the Key Concept Health Information Technology for more information.

Develop a Business Plan

  • Write a short summary to introduce your program, and provide an overview of your plan.
  • Explain the results of your needs assessment, how your program can help satisfy those needs, and any opportunities for expansion. See the Conduct a Needs Assessment section for more information.
  • Provide a background of your organization and an overview of your oral health program that contains its vision, mission, and goals. Describe the scope of services that your oral health program will provide. See the Develop a Vision, a Mission, and Goals section for more information.
  • Outline your program’s management and staffing structure, including staff roles, responsibilities, and qualifications, as well as how you plan to attract and retain staff.
  • Describe the operations plan, which focuses on how clients will be guided through the program. Some topics to address might include client eligibility, appointment scheduling, and registration. See the Implement the Program section for more information.
  • Include a detailed budget with expected income and expenses as well as operating and capital budgets.

"Research hospitals in your area and figure out how much money they lose each year on emergency dental charity care. Tell them about the amount of charity care they have to write off each year, and propose they invest it in your oral health program that focuses on prevention.” - Dr. Angie Settle, West Virginia Health Right

Secure Necessary Funding and Resources

  • Develop a fundraising plan that outlines revenue goals for different funding sources and that might include client revenue, contracts, grants, and donations. Consider asking a partner with fundraising experience to help you develop this plan. Diversifying income sources and weaving together funding streams from multiple sources helps reduce risk and ensure sustainability. See Chapter 3 of the National Maternal and Child Oral Health Resource Center’s Safety Net Dental Clinic Manual for an example.
  • Search for grant opportunities from a variety of different sources, including local, state, and federal governments and public and private foundations. The National Maternal and Child Oral Health Resource Center provides more information on the search process and identifying foundations.
  • Prioritize grant opportunities that your program could pursue. Grants that provide ongoing operational support are more desirable than grants that provide short-term funding.
  • Communicate with grant-makers, even when you’re not currently working on an application for their assistance. Use the opportunity to establish relationships, to learn about future funding, and to keep your program on their radar. See the Establish Partnerships section for more information.
  • Write applications for grants you decide to pursue. Clarify the funders’ expectations, deadlines, and requirements at the beginning of the process, and be sure to address these requirements. See the University of Kansas’s Community Tool Box for an outline and examples for writing grant applications.
  • Identify ways to leverage resources beyond fundraising. In-kind donations (i.e., contributions or gifts other than money) can offset planned expenses on office and dental supplies. For more information on in-kind donation possibilities, read the Virginia Dental Foundation’s Mission of Mercy Finance Committee (PDF) overview.

Key Resources

The resources listed below provide additional guidance and support for financing your program.

  1. National Maternal and Child Oral Health Resource Center’s Safety Net Dental Clinic Manual – This manual is designed to assist safety net dental clinic staff with clinic development and operations. Chapter 3: Finances covers many technical details of financial planning, such as projecting costs. Excel templates are also provided for budgeting and cash flow projections.
  2. National Maternal and Child Oral Health Resource Center’s Financial Management for Safety Net Dental Clinics – This five-module curriculum covers all aspects of financing a clinic, from planning to management and sustainability. Content was adapted from the Safety Net Dental Clinic Manual.
  3. University of Kansas’s Community Tool Box, Toolkits 14 and 16 – This comprehensive resource contains checklists and resources for communities to learn about assessment, planning, intervention, evaluation, and advocacy of community practices. Toolkit 16: Sustaining the Work or Initiative and Toolkit 14: Writing a Grant Application for Funding discuss business plans and offer guidelines for completing grant applications.
  4. California HealthCare Foundation’s The Good Practice: Treating Underserved Dental Patients While Staying Afloat (PDF) – This guide is intended to help community dental practices enhance clinical and business operations by providing best practices and case studies in strategic planning, client flow, staffing, and business systems.
  5. National Maternal and Child Oral Health Resource Center’s Safety Net Dental Clinic Manual: Interactive Budget Planning Worksheet – This manual contains a budget planning worksheet for dental clinics that uses revenue and expense inputs to generate a financial summary worksheet.
  6. National Network for Oral Health Access’s Operations Manual for Health Center Oral Health Programs: Sample Monthly Financial Dashboard (PDF) – This sample dashboard helps communities track program data that impacts financial status, such as gross charges and number of no-show visits.
  7. University of Kansas’s Community Tool Box: Checklist for Following Funders’ Guidelines – This toolbox contains a checklist that communities can use as they prepare grant applications. It includes editing tips and common application sections.