Private Practice
GOODIE PROFESSIONAL PRACTICES, Inc.
We have been sending you emails for many months talking about the
Changing World of Dentistry.
Listen to some of the comments we have heard from other experts.
This is a bit long, but worth your time.
- New policy from major insurers could put an end to solo practices.
- Insurance companies are reducing and/or not covering numbers of restorative procedures for out-of-network dentists while still maintaining reimbursement at a reduced level for in-network dentists.
- Since seventy percent of patients have some form of dental plan, large numbers of patients are leaving out-of-network dentists given their insurance will no longer pay for the recommended restorative care.
- Ninety percent of dentists now take some form of dental plan.
- This motivates solo dentists to once again re-evaluate their future.
- If they become in-network dentists, the third party’s fee schedule must be accepted, driving down their revenues.
- If they don’t become in-network dentists, patients will leave since many decide on their dental care provision based on cost.
- ADA, State Boards, State Dental Societies and Dental Political Organizations cannot stop this.
- Group practices are growing at 19 percent per year.
- Solo practices are shrinking at 11 percent per year, and accelerating.
- Managed group practices can handle these changes in third party reimbursement.
- Solo practices cannot.
- Patient visits and per-patient expenditure per visit continue to decline.
- Dentists’ incomes are declining.
Trend analyses on these percentages show solo private practices
will be less than 10 percent of dental practices within five years.
- The asset value of solo practices is falling.
- Student debt (around $300,000 and rising).
- Significant additional debt from the purchase of an existing dental practice.
- Work/life balance (millennials more interested in quality of life than ownership).
- Dental practice operating and staffing costs continue to climb.
The solo dental practice is no longer the financial highway to retirement.
An asset that isn’t transferable is a liability.
- Investment bankers, equity partners and banks see financing dental practice consolidation as a strong investment.
- The amount of capital being distributed to combining dental practices is in the billions.
- Heavily vested management companies are recruiting dental practices for consolidation.
- Larger DSOs are slowing down the acquisition of solo practices.
- They are now looking for small groups or building their own offices.
The expansion of managed group practice is clear.
- Some solo practitioners are selling their practice to groups as their exit strategy.
- Other solo practitioners are tired of the hassles of being the owner and are selling to a DSO.
- The average age of dentists who own solo dental practices is growing older, increasing the number of available solo practices for sale.
- Declining production and new patients will continue to lessen the value of solo practices.
- Supply is growing and the demand is decreasing for solo practice purchase.
How are most dentists responding?
- The level of resistance and confrontation by most practicing dentists in the face of the obvious future of group dental practice is intense.
- Change takes no sides, is not swayed by emotion, and does not rely on the past.
The future is managed group practice.
THINK
Get good advice, as you so often counsel your patients.
Your accountant, lawyer and financial advisor are very important to you.
Listen to them.
Listen to us.
Contact Us
847.922.8242
This email is not intended for Dentists or Dental Practices
in the State of Florida.
Avrum H. Goodie MBA, President
Goodie Professional Practices, Inc.
4545 W Touhy Av #425
Lincolnwood, IL 60712
847.922.8242 Cell Phone