Consolidation, payer relations and staffing shortages are just a few of the topics dental execs and professionals spoke with Becker's about in May.
What we heard this month:
The most common misconceptions about DSOs, per 1 exec
Barry Lyon, DDS. Chief Dental Officer for the division of orthodontics and pediatric dentistry at Dental Care Alliance (Sarasota, Fla.): Dentists considering affiliating with a DSO may fear the character of their practices and their clinical autonomy would be altered by the supporting DSO. For a DSO, doing this would be counterproductive. When a DSO affiliates with a successful practice, tinkering with what has brought success for years makes no business sense. Along these same lines, dentists may also fear a DSO would come in and make wholesale changes to the office staff. Again, this is something a DSO would not do, especially in today’s business climate when finding skilled staff members is challenging. Besides, why break up a successful team? DSOs want the transition from private practice to supported practice to be as transparent as possible.
The impact of dental insurance on the industry: 6 dental professionals weigh in
Gabriele Maycher. Dental Practice Management Consultant of GEM Dental Experts (Vancouver, British Columbia): Too much emphasis is placed on dental insurance support, and this is affecting patient outcomes. Dental insurance was never intended to pay for extensive dental disease, it was intended to make dentistry affordable. It is a benefit provided by employers as a perk for their employees. As a clinical hygienist, and now a consultant, I have 30+ years of clinical experience, and in that time the insurance support per person has remained approximately the same as dental fees have increased year over year. Meaning less and less dental treatment is supported, and although we know we are to plan treatment according to patient needs, this seems to be a struggle for most clinicians. Insurance support seems to dictate treatment way too often. Until such a time that clinicians get comfortable talking about "money," move away from solely selling services (a cleaning, a crown, etc.) and start to sell "outcomes" (overall oral and systemic health), this ethical dilemma will persist. Dental practices need to change their focus to creating "value" in the services they provide. Dental insurance will then become secondary to the overall optimal outcomes we are trying to achieve.
Why 3 dentists believe debt, clinical training of graduates pose a problem for dentistry
David Riddel, DDS. David Riddel DDS (Dallas): Too much debt is the most dangerous trend in dentistry. Many dentists still have high student loan debt. Many, if not most, DSOs are highly leveraged and may be forced to refinance at higher interest rates. Higher interest rates will decrease the profit margins at many companies, causing many to reconsider dental insurance as an employee benefit. The consumer's debt is also increasing, placing dentistry as more of a consumer elective instead of a necessity.
The most common questions dentists get from patients, and 2 that aren't asked enough
Steven Schneider, DDS. (San Diego): Patients almost never ask about oral health. They may ask about electric toothbrushes. Almost all questions we get are about costs, their insurance, is it going to hurt and how much time will it [take]. Their concerns are really always about convenience and costs. Sad to say, but most just take their oral health for granted unless they have a problem. Then it is usually guilt about not listening to their professionals.
The alarming lack of dental staff and the impact it could have on dentistry
Corey Anderson, DDS. Dentist at Affordable Dentures and Implants (Bridgeport, W.Va.): The most dangerous trend in dentistry from my perspective is a generational retirement of skilled dentists leaving the practice of dentistry in the very near future. Thousands of years of experience are leaving the practice of dentistry this year. There is a substantial training and experience gap with the dentists left in or entering the field. A large challenge to the profession will be to engage and challenge practicing dentists to hone skills and build new skills needed to treat increasingly complex dental needs.
Where dentists are losing money
Phillip Isaacman, DDS. Bluff City Dental (Memphis, Tenn.): What we are currently losing money on is training/onboarding new people. There are heavy costs in time and money associated with hiring new personnel. We do learn from each experience, which is nice. We haven't found any quality from the job posting sites. It seems like those avenues have led to more suspects than prospects. As with our practice, word of mouth is the best referral. Humans are our most valuable asset, so hiring the wrong ones are our costliest mistakes.
'The next two years are going to be super fun': The big-ticket item for Espire Dental's new CFO
Sarah Montgomery. CFO at Espire Dental (Denver): The next two years are going to be super fun for Espire. We took a little bit of a pause on our acquisitions in 2022 because we acquired about 10 practices in 2021, so we needed some time to integrate them and make sure our thesis on our inorganic growth strategy was still going to work moving forward and it also gave us a chance to build a little bit more of a team in the support center. For 2023 and 2024, we're focused not only on achieving the awesome organic growth that we have had in the last two years but also adding on partner practices to grow that inorganic footprint as well. We'll be looking into some new markets as well, so that's my big-ticket item for 2023.
Why 4 dentists see the corporate DSO takeover as the most dangerous trend in dentistry
Owen Waldman, DMD. Waldman Dental Group (Scottsdale, Ariz.): The most dangerous trend in dentistry is by far the rapid growth of private equity and DSOs in the dental space. It's great right now for dentists who are looking to retire relatively soon because it's a fairly early time for these groups trying to gobble up as many practices as possible with all their extra cash from the COVID years. Dentists are getting overpaid for what their practices are worth, so it's a no brainer for many of them — they get to keep practicing as they did and are paid a boatload of money more than they would have. However, once they retire, those practices will simply defer to the corporate model that is based primarily on numbers, as they hire new doctors who will never be majority owners and never have a final say on how things are run. They will simply get a piece of the action, but will be nothing more than high-paid employees with a piece of the pie.
5 dentists share the best, worst parts of practicing in their state
Natalie Stewart, DMD. Mason (Ohio) Elite Dentistry: Despite having two dental schools, there seem to be plenty of patients to go around. Since Ohio is by no means a destination state, being a dentist affords a great lifestyle at a reasonable cost of living.
The worst part about being a dentist in the state is if you do have to work for an office in network with or participate with state insurance yourself, the reimbursement rates are poor. There are few providers who are in network and many children suffer because Cincinnati Children's and the health departments can only handle so many patients. At one point, I was receiving a percentage of collections as an associate and regularly was paid less per hour than my assistant due to low reimbursements.
How private equity and consolidation is set to impact dentistry
Thomas von Sydow. COO of Cornerstone Group (Irvine, Calif.): I believe the interest rates will slow the pace of consolidation for a few years, but in comparison to other industries, dental is still a strong bet for private equity. I believe we will see larger DSOs that have secured capital already start to roll up smaller DSOs that align with their core business. Specialty will continue to be a hot market, especially pediatric dentistry and orthodontics, where patients self-refer versus surgical DSOs that still rely on general dentists to refer.