Step inside your friendly neighborhood dentist office today and you’ll probably see more than just a drill configuration, a chair, a spit tray and a smiling hygienist standing at the ready. Dental offices are turning into a tech-land wellness space.
Dentistry is becoming a complex business entity, providing not only your basic dental services but also services that are key to your overall physical health. This transformation is also attracting corporate business developers who see dollar signs in a high-profit-margin business.
Oral health treatment is not just about shining up them-there pearly whites. It involves your gums, the lining of your mouth and throat, your tongue, lips, salivary glands, chewing muscles, nerves and the bones on the upper and lower jaws. Researchers at the Mayo Clinic found that what happens in your mouth can affect the function of your heart or your kidneys, create pregnancy and birth complications, cause pneumonia or even make diabetes worse.
Today’s dentists are changing as well. They are doing more than just fixing cavities and giving you a lesson in proper tooth maintenance. They’re also the partner or owner, the CEO, the business manager and the technologist driving the business to whatever next level their solid business plan identifies.
“We put on different hats—the business hat, the clinician hat, the neighborly friendly person hat,” says Gary Hatutian, a Southwest High School graduate and the owner of Executive Hills Dentistry in Overland Park.
This trend is being felt everywhere, and David Thein is on the frontlines of the transition. Thein operated two periodontal dental practices in the late 1980s, which he sold by 2019. Now he is a clinical professor and curriculum director at the UMKC School of Dentistry, teaching the business aspects of dentistry. “When I was in dental school years ago, we had very few business-related trainings at all,” Thein says. “We pretty much got into dentistry and just winged it. And because the profit margins in dentistry are high, most of us had no problem.”
Today, Thein says, business training is ramping up as dentistry becomes more of a healthcare enterprise. “It’s much more complicated than it has ever been,” he says. “Even though dentists have the rooms available and the time available, they don’t have the people available to maximize the capacity they could have if they had all the right pieces in place.”
Marko Vujicic, the chief economist and vice president of the Health Policy Institute at the American Dental Association, says it’s not necessarily that the dentist is becoming more like a CEO but that smaller practices and solo practices are being replaced by group practices of different sizes and different natures. “Part of that consolidation involves a kind of a split between the clinical duties and the management duties,” Vujicic says.
Practices are consolidating because they are looking to get more efficient and scale up their business, Vujicic says. “The business is dealing with long-term trends such as insurance reimbursement rates to dentists rising much slower than inflation. Yet the cost side of running a practice keeps going up in terms of labor costs, wages, equipment and supplies, technology. It’s squeezing dentists’ earnings, which have been sluggish and flat.”
That being said, being a dentist is a good living. It’s an insurance-driven business, meaning there’s a relatively dependable cash flow because most insurance companies pay 100% of simple preventative services.
The majority of dentists are owners or partners. Salaries range from $100,000 to $200,000 a year, with some dentists making as much as $500,000 annually, according to a business intelligence salary survey.
Porcelain veneers can cost nearly $2,000 a tooth; crowns can be $1,500 per tooth. A full smile makeover? Upwards of $17,000.
But right now, for all dentists, the No. 1 business priority is finding and keeping a good hygienist. The American Dental Association reported that just 60% of dentists have an adequate number of dental hygienists on staff.
“Labor is costing 25% more than it did five to 10 years ago,” Hatutian says. “Going rates for hygiene service in dental practices are anywhere from $40 to $60 an hour. In some other cities on the coasts, they demand $70 an hour and even more.”
The kind of wages that are needed to alleviate hygienist shortages and draw more people into the hygiene profession may not be fiscally feasible in the short term, Vujicic says. “We’re in a bit of a pickle here in terms of staffing shortages,” he says.
Thein says the new dentistry business model has changed considerably over the past few years, reflecting the influx of corporate dentistry. “Private equity has seen how profitable dentistry is, so they’re kind of getting in on the deal,” Hatutian says.
Three years ago, the UMKC dental school put together a DDS/MBA program. “Students are now electing to do this dual degree just to get training that they may need to do the kind of dentistry that’s being done today,” Thein says. “A dentist who wants to be a business person—buy multiple practices, hire other dentists to work in those offices, manage those offices, and maybe do some clinical work—has to have more skills than we can teach them in dental school, business-wise.”
