Dentists turning away from practice ownership as complexities grow

Dentists are finding it more difficult to own and operate private practices, leading to a decrease in practice ownership and increased consolidation under DSOs. 

New data from the American Dental Association's Health Policy Institute shows that ownership among private practice dentists continues to decrease. Only 72.5% of dentists in private practice are owners in 2023, down from 84.7% in 2005. Recent data also shows that younger dentists who have been out of dental school for less than 10 years are more likely to be affiliated with a DSO. Today, only 8.8% of dentists under 30 own practices. 

Corey Anderson, DDS, a dentist in Bridgeport, W.V., said there are fewer benefits to owning a private practice as costs rise in a demanding profession.

Dental practice expenses have begun to outpace revenue in recent years. The median annual practice expenses for general practitioner owners were $540,928 between 2013 and 2017. That number hit $582,730 between 2018 and 2022, a 7.7 percent increase. Median annual practice revenue was $741,195 between 2013 and 2017. That number rose to $757,549 between 2018 and 2022, a 2.2 percent increase.

"Shrinking margins with increasing costs on all sides place the dentist in the center to do more with less and more for less. At the same time, patient expectations expand as new practice techniques and technology can deliver consistently better results but typically with increased expense," Dr. Anderson told Becker's. "Unfortunately, dental insurance continues to be stuck with a mindset of nearly extinct dental treatment modalities and reimbursement received only after massive administrative barriers. A dentist can enjoy the practice of dentistry and love patients but get worn down by the climate of the dental industry."

The rising cost of dental education and student loan debt is also affecting practice ownership. The cost of attending public and private universities has more than tripled in the last 50 years, while the average dental student debt has also increased, reaching an average of $292,169 in 2019. 

"With increased debt and often fewer buying opportunities, younger doctors get caught up in the corporate model and simply become worker dentists, maybe with a piece of ownership," Owen Waldman, DMD, told Becker's. "With increased DSO presence to new graduates in dental schools, they have been groomed more as to how great it is to not have to worry about admin, staff, etc, and just worry about producing at the chair and all the benefits of being part of the DSO. Sadly, as time goes on, many new grads come into the field with this thought process and will never be their own boss who owns their own business. There will always be private practice owners, but those numbers are definitely trending down significantly."

Copyright © 2024 Becker's Healthcare. All Rights Reserved. Privacy Policy. Cookie Policy. Linking and Reprinting Policy.

Featured Podcast