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Should You Join a Dental Service Organization?

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Patient Attraction Episode 695

There’s no question that the private practice physician is slowly disappearing. More and more medical doctors are working in group practices or in hospital-affiliated or -owned practices. The fairly recent rise of the Dental Service Organization, or DSO, may herald the same trend for dentistry. I’ll be back after the break to discuss some pros and cons of joining a DSO.

– Colin here, and welcome to this episode of the Patient Attraction Podcast.

– Data from the ADA indicate that group practices increased nearly 2,000 percent from 1992 to 2007.

– More recent data indicates that larger practices continue to erode the share of total receipts of smaller practices.

– With the economies of scale that group practices can enjoy, the private practice dentist may be at a competitive disadvantage in some respects.

– The same is certainly true for corporate dentistry.

– It’s hard for a sole practitioner to compete on price.

– And there are indications that recent dental school graduates, many of whom are carrying hundreds of thousands of dollars in debt, are choosing corporate dentistry.

– Some people see DSOs as being at least a partial solution to the challenge of big-box corporate dentistry.

– Others see DSOs as not much different from the corporate boys.

– The Dental Service Organization, as an entity, is a fairly new development.

– DSOs do offer a number of advantages.

– They handle non-clinical functions such accounting, marketing, legal matters, and human resources.

– That frees up the dentist to treat patients.

– And who wouldn’t like that?

– Just like group practices, DSOs can also establish a network of specialists instead of referring patients out.

– That all sounds pretty good.

– What are the downsides to dental service organizations?

– DSOs usually, but not always, represent an investment of capital on the part of the dentist.

– With that investment CAN come pressure for allied dentists to meet patient quotas and to recommend procedures with higher profit margins.

– A 2014 survey by Columbia University College of Dental Medicine found that, of graduates who had worked in DSOs, roughly one-third had experienced those financial pressures.

– And, like all areas of medicine, there have been some bad actors in DSOs who have run afoul of the law.

– So, what’s the bottom line?

– If you value your independence above all, a DSO isn’t for you.

– If you’d prefer to be rid of practice management responsibilities and focus on treating patients, a DSO might be a solution.

– This podcast can only scratch the surface of this issue.

– Like any business decision, your due diligence and caution are vital for making a wise and informed decision.

– Tomorrow’s podcast will focus on measuring your dental marketing ROI.

– Until then, keep moving forward.

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