Becker’s has spoken with dozens of DSO executives this year about leadership, staffing, overcoming challenges and more.
Here are 10 notable insights from dental industry leaders:
Doug Drew. CEO of U.S. Oral Surgery Management (Irving, Texas): I’ve been doing this for quite a bit, and I’ve learned from a lot of great people along the way. I think it’s really important for a leadership style to match your personality in order for it to be authentic. If you’re trying to act in a way that doesn’t naturally fit how you are as a person, I just think people don’t necessarily gravitate to something like that. I’m a relationship-oriented person, whether it’s in my personal life or professional life. I’m careful who I surround myself with because I want to get to know people, spend a lot of time with them, and for me, building those great relationships leads to having collaborative discussions to get to the right answer. I know I’m not going to have all the right answers, certainly in a new specialty for me, but surrounding yourself with great people and creating that culture where there’s mutual respect and people feel comfortable sharing their opinions is really important. If you can do those things well, it helps people understand you’re doing this not only to help build a great company, but you’re doing it to create great opportunities for people up and down through the organization, whether it’s at the PSC where we support our surgeon practices or at the practice level. I think businesses like the one we’re in are really relationship based, and if you put that first, everything follows fairly easily from there.
Dan Burke. Chief Enterprise Strategy Officer at PDS Health (Henderson, Nev.): I think we’re seeing a clearer divide between DSOs that truly add value and those that don’t. The ones that will thrive are focused on improving clinical care and clinical outcomes, helping patients get the best care and doing it on scale. The value creators talk about lifetime patient value, care quality and long-term impact. They put clinicians and patients first, knowing that business results will follow. Those organizations will continue to play an important role in shaping the future of healthcare in neighborhoods around the country.
The DSOs that will have the biggest challenges are those that still see themselves primarily as aggregators — trying to grow by simply cobbling together more practices. That model isn’t built for long-term success. The real challenge isn’t interest rates or other external pressures. It’s whether or not they’re adding real value to the clinician and the patient. At the end of the day, that’s how DSOs need to judge themselves when they look in the mirror.
Jason Auerbach, DDS. Co-CEO of MAX Surgical Specialty Management (Hackensack, N.J.): I think more and more people are seeing oral and maxillofacial surgery as really a tremendous opportunity. It’s a healthy business. There are strong margins, and it’s a nuanced business. I do think you’re going to see some private equity investors that are maybe not as aware of the nuances of this specific specialty, who may or may not do as well, and then those who really understand the surgeon mentality and the focus on the surgeon, not just the focus on EBITDA and analytics and things like that, are going to start separating themselves clearly from the pack. As long as the macro economy continues to be strong, you’re going to start to see a continued interest in the field.
Paul Reda. CEO of North American Dental Group (Pittsburgh): You have to do the right thing for your people. I want to pay our team well enough that they feel comfortable, that they just want to do the right thing. I think that’s the first thing. I think you give them the best tools, right? We’re putting CBCT scanners in all of our practices, all of our practices have iOS scanners, we have Overjet, we’re putting SprintRay printers in our practices. So we’re giving our teams all the tools to be successful. We’ve rolled out certified health kiosks and online scheduling for all of our practices, so now patients can check in online easily. They can schedule online. It’s easy for billing, it’s easy for getting their information, which all focus on, how do we give the patient experience the best thing? It costs money.
Laura Sage. Director of Learning and Development at The Aspen Group (Chicago): I think the biggest misconception we hear is that we’re telling the doctors how to doctor, like how to do things. We are offering consultative guidance on a lot of these things. We have many experts who were top in their field that helped build a lot of the curriculum, but we’re never going to tell them what to do and how to do it. It’s up to them to adopt whatever it is they want because at the end of the day, they’re the provider. They can utilize our services however they would like to. We get a lot of doctors who come in and they’re like, “Well, I heard I can’t manage my own schedule. Aspen runs my schedule,” or “I have no control over what I treatment plan,” and that’s just simply not the case … we’re just helping them with the tools to make it happen.
David Pallaschke. CFO at Salt Dental Partners (Phoenix): I think the biggest thing is having a really good partnership with operations. [There are other companies] where finance is a little bit more commanding. It’s not partnering with operations. It’s kind of telling operations what to do. I think it is super important to establish a partnership because once you can establish a partnership and you’re able to provide insights, it’s a lot easier to drive the business through the insights and partnership than it is to have a finance team that is sort of commanding and telling operations what to do.
Daniel Hosler. CEO of Allied OMS (Southlake, Texas): We continue to hold cautious optimism. I think there’s so much going on in the geopolitical arena. There’s a lot going on certainly on the domestic front, with respect to policy creation. We’ve kind of kicked the can down the road a couple of times on these now 10-year-old tax cuts, so I think many of us are looking at this very closely to [ask], how do we make sure we double down on taking great care of patients? As long as we do that, there’s going to be demand. It’s really hard to predict, should we be more aggressive or less aggressive? I think one of the tactics we’re taking right now is, let’s just translate that cautious optimism into doing the things we know we can do well, and that is buying and partnering with practices, opening de novos, and teaching and recruiting young surgeons about why Allied OMS is a great platform to join. As we add more service line extensions, it is going to naturally create a more efficient environment at the practice level. Those are really the four things we’re going to stay focused on this year.
Bob Rubino. CEO of Qualitas Dental Partners (Sharon, Mass.): If you go to any of the Chambers of Commerce and say, “Give me your best marketing materials to talk about the area,” they’re not great. We have had to go out with our own money and our own time and resources to build some quality materials to convince people that coming to New England is something special. So far, we’ve added many providers that way. We’ve transplanted many people who didn’t necessarily give New England its due, but it’s every day we have to do it. We’re adding a valuable service to the area because we don’t want to see practices go dark. We don’t want to see providers leave the area or retire without replacing them. Eventually, there’s a whole crop of dentists who are going to retire. They must be replaced, or the problem of access-to-care is going to get worse. We are organized to help alleviate this problem.
Kirsty Leyland. Executive Vice President and Chief Human Resources Officer at Heartland Dental (Effingham, Ill.): We have a multifaceted approach to measuring employee satisfaction. We conduct an annual engagement survey that includes indicators like employee net promoter [scores] and an engagement index, which is sort of an average of a number of different variables. Those tools help us understand how team members feel about their work, their leadership teams and the overall environment of where they work. We’ve also more recently begun to follow up on those engagement surveys more frequently with small pulse surveys to track progress and measure sentiment between those main surveys. Beyond surveys, we monitor sentiment on other platforms like Glassdoor and Indeed, and we actively encourage feedback through internal channels as well. That feedback loop helps us identify what’s working, where we need to improve and how we can best support our people. Ultimately, I think it helps team members feel heard and valued and empowered to grow. That’s our aim — to ensure every member feels heard, valued and empowered. Engagement is really a key strategy on why we continue to be recognized as a great place to work, and I think these different initiatives help us keep that flywheel spinning in a positive direction.
David Skelton. CFO of Flagship Specialty Partners (Charlotte, N.C.): I expect that we will continue to see transactions in dental, but the bar will be high due to the uncertainty around consumer spending, tightening credit, high interest rates, rising default rates, trade wars and the increasing potential for a mild recession. DSOs with high-performing doctors, solid operations, integrated platforms, healthy margins and favorable organic growth will continue to find buyers at reasonable prices, and DSOs that don’t meet these criteria will have difficulty achieving exits. There are companies looking to exit and private equity capital that needs to be put to work in growing sectors for the right opportunities.
