Consolidation of dental supply companies and practices is creating a new set of challenges for practice owners, according to Robert Trager, DDS.
Dr. Trager is a dentist at the JFK and LaGuardia airports in New York City. He recently spoke with Becker's about the trends taking place in the industry he is most afraid of.
Editor's note: Responses were lightly edited for clarity and length.
Question: What trends in the dental industry are you most afraid of?
Dr. Robert Trager: One of the most important trends I am afraid of is that the insurance companies are not utilizing the consumer price index to increase reimbursement fees to keep up with inflation. Many of the insurance companies are still dictating the parameters as to how we treat the patients, but not in the most ethical and economical way. Why is it that the same insurance company will pay higher reimbursement fees for the same procedure on patients who have the same insurance company but have different employers. I have always advocated that as dentists we should offer to help advise the unions as well as the human resources department to help in negotiating dental contracts. I did this over 20 years ago with the Transport Workers Union for American Airlines at JFK and LaGuardia airports, and they offered to fly me to Dallas, Texas, to speak with the union representatives on behalf of the airline to assist in negotiating dental benefit contracts.
Another problem I am concerned about is the consolidation of dental supply companies. Benco, Patterson and Schein are all buying up the independent and small vendors, thus decreasing competition. They have already been fined for price fixing, so what is next? Amazon and eBay are now selling dental supplies online that are obviously cheaper, but can they offer and/or deliver the same service as the big three? A suggestion I have is that the big three should give stock options to their loyal customers to offset the higher fees they charge. Companies such as Walmart and some of the large pharmacies are opening dental services in their establishments. How is the solo practitioner going to compete against this new business structure? As solo practitioners we offer personal care with dignity, concern and pride and will always be there to offer emergency services as well as advice.
The next problem that concerns me is the platform for the DSOs. They are good for the young dentist who needs a job to offset their student loans as well as the older practitioners who want to retire and be bought out. The DSOs are the future of dentistry and the ripple effect is that the specialty practices are now consolidating themselves. What concerns me most is that when a DSO associate leaves the practice they are in [they] will not have the skills to associate with a private practice. Many if not all the DSO practitioners will not have the skills of finance, management, treatment planning and even diagnosis as well as ordering supplies or utilizing a top laboratory. Everything is done for them, including artificial intelligence, which doesn't allow them to have the knowledge that are inherent in operating and maintaining a private practice. They have no insight as to where to buy or associate in a private practice. There will always be room for the DSOs and solo practitioners if all patients are treated with care and concern.