Is Private Practice Dying?

I often hear a lot of discussion within the dental community and read various online opinions suggesting that private practice dental offices are dying. The prevailing notion is that only corporation and DSOs will dominate the industry in the future. However, it is essential to differentiate between facts, trends and fears regarding the matter.

Firstly, it’s important to acknowledge that the challenges faced by dentists and dental practice today are indeed real. Some of these include:

• Stagnant or Decreasing Insurance Fees

• Increased Wage Demands

• Oversaturation of Dentists

• Shortages of Support Team Members

• Economic Recession

• Increased Supplies & Labs Costs

These concerns are valid and have existed for quite some time, including 15 years ago. Let’s go back in time…

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Developing Business Skills

In 2009, amidst the recession and housing crisis, I took the plunge and established my dental office from scratch. Back then, I had limited knowledge about running a business, but I was determined to make it work. In the initial years, my earnings were okay, as I followed the advice passed down from dental school and experienced dentists: "Focus on providing excellent dentistry, and success will follow."

However, I soon realized that this approach didn't yield the expected results for me. The advice I received primarily came from dentists who had been practicing for decades, operating in a different economic, social, and business climate than what most of us were facing at that time.

The penny finally “dropped” for me, forcing me to change my approach.  Being a practice owner is a very different role from the dentist role and requires thinking like a business owner (of any industry) along with a different set of skills. I needed to become more competent and savvier in business, and as well as leadership skills.  We should focus on patients first, but a close second needs to be the business itself.  Once I accepted this reality, I started reading and taking business courses and my office doubled in size and revenue.

A few notable examples:

1)  Location:  If you build or purchase your office in an oversaturated area where there is a lot of competition (*cough* CA and NY) then you are fighting an uphill battle. Sure, you can win, just understand it will be MUCH harder and you need to be THAT much better.

2) Marketing:  Marketing is necessary!  Unless you have a legacy office, marketing is a requirement.  Whether that is external marketing, internal, or insurance network participation (another avenue of marketing); some form of marketing is necessary to sustain and grow. Learning how to be effective at marketing your practice is important!

3) Systems Run Everything: We don’t think about it, but clinical dentistry is all about systems too.  What materials you use, burs, steps, etc. are all part of the clinical system for each procedure.  Businesses have systems too, basically steps and processes for how each function in the office runs. One can either organize those systems for success, or you can “wing it” like many and often experience a lot of mistakes and failures. Intentional, efficient design of processes, which are adjusted from time to time is an important aspect of success.

4) Communication is everything: Whether it be communication with your team (also called leadership), communication with your patients (which translates into treatment acceptance), and communication with insurance companies in or out of network (to achieve reimbursement) is extremely important.

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Design Better Efficiency

Next, I had to learn the importance of process efficiency. I have heard many times from people who want to be naysayers say, “I don’t want to work faster.” To that I would say, “Great, neither do I!”  Efficiency has little to do with speed.  It has everything to do with being smart and taking less time and energy per step. Otherwise said, efficiency increases results AND reduces stress!  We can all learn to be more efficient, especially in dentistry because the normal amount of inefficiency is impressively high in many dental offices. I had to learn to take time to study and map out each process, step by step, conferring with my team to design processes that were more efficient and achieved buy-in from the whole team.  Learning to become efficient as a team also translated into increased ability to treat more patients, increased revenue, and allowed us to work fewer hours.  

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Make Insurance Work FOR You

Dental Insurance is probably the least fun aspect of running a dental office.  I had to spend a lot of time truly understanding it before I learned how “not” to lose money over it and “begrudgingly” accepted its value. Because I often educate others on how to make insurance more effective some label me as pushing the in-network concept. However, a good portion of the dentists I coach, I’m helping to get OON. Personally, I am an insurance network agnostic. I don’t have a conceptual preference between INN and ONN. I have managed both types of offices successfully.

In general, the key to successfully managing insurance is mostly about efficiency no matter the network status. Whether INN or FFS we all have patients who purchased dental insurance they want to utilize.  When you learn how insurance works it becomes very predictable and winnable. When we complain about insurance and therefore fail to learn more about it, the process becomes incredibly frustrating and less effective for us and our patients.  The point is that regardless of which participation levels we choose with insurance, they all have their own pros and cons, and we need to make that choice work well for OUR personality and skills.  That is the best way to be highly successful.

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In Summary

When you learn to build, adapt and sustain strong, efficient systems, the sky is the limit on increasing profitability and reducing stress. When efficient processes result in more patients and higher revenue, supplies and lab costs matter less.  When you learn more about insurance, network fee schedules can go up and the few low ones can be mitigated. 

Wage demands are not a problem when you are highly productive. Finding team members is not a challenge if you have a great culture, a thriving office, and happy team members who like working together. I have had to hire five new team members since COVID. They started as temps originally telling me they had no interest in full-time jobs, and now they work full-time.

Is Private Practice Dying?  I don’t believe it is. I believe Private Practice has a long life left to live if we learn to be more than great clinical dentists. Through reading, attending a conference, or getting advice from a mentor, I highly suggest we all go back to what we were all good at one point in our lives: being students.  We now need what dental school did not teach us: better communication, business and marketing skills, efficient systems, and insurance knowledge.

For help with insurance support, please visit DentalInsuranceGuy.com. It’s a great resource for doctors and team. Members have access to watch on-demand videos, attend office hours and the option to ask me a question anytime through the member portal.