Corporate dentistry is a competitor of private dental practices. Often serving hundreds of patients, dental service organizations have several practices in different locations that operate under the same brand. Compared to private practices, they allow dentists to focus more on treating patients.
Your Corporate Dentistry Questions Answered
Corporate dentistry is a growing trend where a dentist (alone, with another dentist, or with a non-dentist) owns and operates several dental practices through the use of corporate vehicles. The multiple practices are overseen by a third-party owner and possibly a different management structure that may not include any input from the dentist providing the treatments to patients.
For decades, corporate dentistry has been big in Australia and the U.S and has started gaining traction in Canada within the last five years. One of the biggest dental service organizations in Canada is the Dental Corporation Canada (DCC). With its inception in 2011, the company operates more than 160 dental practices across Canada and is still expanding. Although the Canadian Dental Association believes only two percent of dental practices in the country are owned by corporations such as DCC, this number is expected to rise.
The Perfect Conditions for Corporate Dentistry
Simply put, corporate dentistry is occurring because there is a market for it; there is plenty of demand and a lot of supply. Dental practices offer great returns for their owners. Treatments are not cheap, and everyone requires dental work, so it is a stable industry. Therefore, you have both dentists and non-dentist investors who want to own and manage dental practices.
As for supply, each year there are dentists who want to retire and sell their practice. Selling to a dental corporation is enticing, as they are known to offer generous amounts to solo practitioners. Issues like financing and employee-related liabilities would cause other practices to back out a deal, but dental corporations can manage these risks.
The Benefits of Dental Corporations
The management and operational model of corporate dental practices can be quite appealing for dentists and new graduates. With this type of practice, the dentist is only involved in the treatment of patients and clinical activities. It is only them who are legally allowed to determine treatment options, hiring or firing of dental professionals and hygienists, clinical protocols, patient evaluation, and diagnosis, etc. The third-party owner is responsible for the non-clinical activities and everyday operations such as bookkeeping, accounting, payroll, billing, and general office management. This operational model may be ideal for many dentists who are well versed in dental care but not the aspects of running a business. There is no administrative duties and the stress that comes with managing your own dental practice.
In theory, corporate dentistry increases access to high-quality care. When the dentist is left to evaluate and determine dental care and the third-party owner takes care of administrative and business tasks, the partnership should result in greater efficiencies and cost-savings. Those things should trickle down and turn into cost-savings for the patient, while still providing high-quality care.
How will Corporate Dentistry Affect Other Practices?
Other practices will, without a doubt, face increased competition. If they are on the smaller side, they may not have the buying power or resources (human or financial) to compete with a dental corporation. Making it harder is the fact that many dentists are not knowledgeable about marketing or the business aspect of running a practice. Dental corporations are adept in these areas, which can make the situation more difficult. As for practices which are already considering selling, dental corporations are a good way out of the industry with the best possible terms. The only way to combat this competition is to enhance the patient experience.
Canada’s current dental industry landscape sees a small percentage of practices run by dental corporations, but that number is rising due to supply and demand. The operational model used by corporate practices appeal to dentists in that they would no longer have to look after administrative duties and can focus on what they truly love to do—practice dentistry and treat patients.
If you want to learn more about incorporating your dental practice, contact us today.