Dental practices are navigating persistent margin pressure from rising overhead costs, PPO fee compression and tight labor markets. Cost-cutting alone rarely moves the needle.
According to dental leaders, the squeeze on margins is no longer temporary. Dental equipment and supply prices continue to rise faster than the inflation rate, while reimbursement rates in most states remain below 50% of dentist charges, according to data from American Dental Association data.
Three dental leaders recently connected with Becker’s to share where they see the greatest opportunity to build sustainable profitability.
Note: Responses were lightly edited for clarity and length.
Question: Dental practices can’t just cost-cut their way to sustainable margins. Where do you see the greatest opportunity for practices to create healthy margins?
Josh Lebovics, DDS. Owner of Simi West Dental Group (Los Angeles): Depending on the type of dental practice, most operations carry redundant or unnecessary costs. A deep-dive audit of line-item expenses often reveals overhead that can be eliminated. There is a general consensus that products or services with the dental label carry a premium price. For example, office build-outs using standard raw materials and construction can cost 20% to 30% more when sourced through a dental-specific vendor. The same applies to many disposables used in the operatory, and compounded over time, these inflated costs significantly impact a practice’s bottom line. Reducing redundancy is equally important. For instance, paying both an IT company and practice management software tech support often means paying twice for overlapping services. These are small, yet effective, changes that can go a long way in improving margins.
Sonalika Rungta, DMD. Dentist of Thompson (Conn.) Smiles: Dental profit margins can be increased by renegotiating PPO fees, negotiating fees with labs and vendors, as well as outsourcing some tasks using agentic AI for insurance verification, insurance claim tracking and revenue cycle management. It is counterproductive to use cheap labs and poor-quality materials, as patients notice when fillings fail, crowns fall out and new prostheses and implants fail. This leads to a loss of trust between the doctor and patient and more stress for the team members.
Bob Skopek, DDS. Owner of Skopek, ClearCut and EverSmiles Orthodontics; Co-founder of Vanguard Orthodontic Group (Huntley, Ill.): In dentistry and orthodontics, there is a dangerous misconception that more patients and aggressive cost cutting automatically mean more profit. They don’t. A practice can be packed from morning to night and still struggle financially. The race to the bottom is rarely a winning business strategy. Cutting every possible cost, aggressive treatment planning and squeezing more patients into every available appointment generally comes at the expense of quality, team morale, patient loyalty and ultimately the reputation of the practice. Healthcare is not a commodity where the highest volume and lowest-cost provider will be on top. The strongest dental and orthodontic practices understand that profitability is a result of delivering exceptional value. The goal should not be to build the busiest and cheapest practice possible; it should be to build a practice so good that patients recognize its value, are willing to pay a fair price for it, tell others about it and choose it again and again.
At the Becker's 5th Annual Future of Dentistry Roundtable, taking place September 14-15 in Chicago, dental leaders and executives will gain insights into emerging technologies, practice growth strategies and the evolving landscape of dental care delivery, with a focus on innovation, patient experience and operational excellence. Apply for complimentary registration now.
