An opportunity for dentists to serve communities in need

The financial dynamics of medical offices have changed. There are now many ways in which dentists can open new businesses in communities that need them most, while also building wealth. Of course, this is easier said than done, but with the right brand and model, it’s possible for young dentists to see their dreams come true. 

Thirty years ago, if a dentist wanted to start their own business, it was their responsibility to own or lease the office, market themselves to the community, hire and train new staff, and look over the financials every day. However, dentists don't learn this in school, and figuring out how to manage these responsibilities on the fly makes it even harder. Entrepreneurs must take on more debt and pay off what they already owe to dental school, which puts even more pressure on them to be successful. 

But now, through various government financial incentives and programs, there is the chance to build businesses in communities that lack dental offices. Realizing that those living under the poverty line ($17,609 a year)¹ often cannot access dental services, the federal government has expanded Medicaid to help them pay for it. This means higher reimbursement rates for dental offices, which also makes it easier for dentists to open offices in communities with populations that have high enrollment in Medicaid because the risk is lower. 

Where DSOs can help

But there is still a problem that these incentives do not solve—creating a business model that works while managing an office. When someone goes into a medical office, they want to feel confident they’ll receive the best care possible. This ensures that customers come back and the business is successful. But most dentists did not learn how to do this, which is why most dental offices have turnover rates of 17%,² when the ideal goal is 33%. 

It should not be surprising then that the popularity of the dental support organization (DSO) model has grown. DSOs remove much of the backend office work that dentists are not trained in, nor do they care to spend their time on. Studies have also shown that DSOs are better able to control costs such as rent, dental supplies, and benefit packages than smaller practices, which makes DSOs more profitable.³ Not only does this help owners pay off their debts, but we’ve recently seen that more dentists want to work at a DSO because, since the great recession, many dentists want the flexible schedules that medium to large DSOs can provide.⁴ 

We also know that DSOs have done well in communities they enter because of the branding and marketing techniques they implement,⁵ and they also seldom have much competition

So, the question becomes, “How do you market a new DSO?” It’s not just about paying for advertisements. The atmosphere you create is key. For example, making sure that children waiting to see the dentist are in engaging environments helps ensure they behave, which reduces stress for parents, who will not only want to come back because they had a good experience but may also choose to use your dental services as well.⁶ 

While dentists are serving communities in need, they’re also building equity in the businesses in which they have a stake, with the ability to pay down their debts. They can also feel confident that when they’re ready to retire and sell their stakes in the business, they will make a profit because both the business and marketing models have proven to work.

 References 

1. Garfield R, Orgera K, Damico A. The coverage gap: Uninsured poor adults in states that do not expand Medicaid. KFF. January 21, 2021. https://www.kff.org/medicaid/issue-brief/the-coverage-gap-uninsured-poor-adults-in-states-that-do-not-expand-medicaid/
2. Arulrajah N. strategies to improve dental patient retention. Oralhealthgroup. March 10, 2021. https://www.oralhealthgroup.com/blogs/strategies-to-improve-dental-patient-retention/
3. Elsenpeter R.The top 9 benefits of DSOs for dentists. Dental Products Report. March 23, 2016. https://www.dentalproductsreport.com/view/top-9-benefits-dsos-dentists
4. Miller B. Dentist careers with DSOs: 9 things to consider. JoinDSO. https://joindso.com/dentist-careers-dsos-9-things-consider/
5. Jansen JJ, van der Welle AJ, de Joode J. The evolving role of the DSO in efficiently accommodating distributed generation. June 2007. Citeseer. https://citeseerx.ist.psu.edu/viewdoc/download?doi=10.1.1.490.278&rep=rep1&type=pdf
6. Creating a peaceful environment for young children. Penn State Extension. https://extension.psu.edu/programs/betterkidcare/early-care/tip-pages/all/creating-a-peaceful-environment-for-young-children