Many factors drive dentists to pursue large and small group practice settings
April 09, 2012
By Karen Fox, ADA News staff
There are many paths to large dental group practice.
Dr. Kate McCann of Aurora, Colo., practiced as an associate dentist for Pacific Dental Services for just six months before she was approached about becoming an owner. She now has an ownership stake in two practices, Aurora Modern Dentistry and Green Valley Ranch Modern Smiles and Orthodontics.
Dr. Kenneth Burson of Littleton, Colo., has an ownership stake in two practices, Falcon Park Dental Group and Lone Tree Dentist and Orthodontics.
Both are 2010 dental school graduates and owner dentists with Pacific Dental Services, which has been in business since 1993, has 270 offices in eight states, and is one of the larger players in group dental practice.
“Our model is based on all supporting offices owned by dentists,” said Joe Feldsien, senior vice president of professional partnerships at PDS. “That is one thing that distinguishes us: there is no corporate brand. We call ourselves 'private practice plus.’ We are trying to bring a higher end model and support the local dentist, with modern dentistry and the financing they need to be successful, hire staff and do everything that private practice does.”
Dr. McCann, a graduate of the University of Illinois at Chicago College of Dentistry who unsuccessfully sought full-time practice in Chicago before discovering employment opportunities in Colorado, said she feels fortunate to be at PDS.
“The profit margins are higher here than for many of my friends in private practice,” said Dr. McCann. “Pacific has efficient systems for marketing and billing, so I just come in and do dentistry. The company also offers huge amounts of continuing education, which is important to new graduates.”
The dentist-owned practices that PDS supports are structured differently depending on state law. In Colorado, the offices are organized as provider networks under a specific statutory reference. Dr. McCann is the dental director for her practices and has four associate dentists who work for her. She does not own 100 percent of the practices but has an ownership interest at two offices and soon to be a third.
She may not have a controlling interest in the practices, but it’s better than having no equity, Dr. McCann said, and it gives her the motivation to increase the value of those practices.
Dr. Burson, a graduate of the Creighton University School of Dentistry, also has an ownership interest in two practices. Practicing at a large group practice wasn’t his first choice. He was one of two candidates being considered to purchase a practice from a solo dentist, but his student debt became a red flag for the seller who wanted to be bought out within two years. So Dr. Burson moved on to plan B.
He was aware that a corporation could infringe upon his autonomy and place high expectations on a young dentist to produce. But he was able to identify some options that supported dentists’ autonomy, however “they didn’t offer ownership.” That’s when he chose Pacific Dental Services.
“I think that for new dentists, this is one of the best options out there,” he said. Being able to treat patients right away and hone his clinical skills were priorities and he wanted to build on the momentum he had coming out of dental school, where he had an internship with the Indian Health Service in Tucson, Ariz. Pacific allowed him to steadily increase his patient load to his comfort level.
“I never felt that the business was dictating the dentistry that I wanted to do, and when I had the opportunity to become an owner, I decided to take it.”
He plans to evaluate where he is in 10 years and decide if he’d like to continue with large group practice.
“If I’m still in love with Pacific, then I’m going to continue. If I want to break it off and go into practice on my own, all it would take is to groom an associate to buy me out,” said Dr. Burson. “Dentistry is a lifelong career for me; to say I’m going to be working with PDS the rest of my life is more difficult to say at this point. I know as of today and the past two years, I’ve been nothing but satisfied with the experience and what they’ve done to foster my growth as a new dentist.”
PDS is a member of the Dental Group Practice Association. Several DGPA members attended a Jan. 31 meeting with ADA leaders and staff to discuss areas of mutual interest. Representatives from DentalOne Partners, SmileBrands, Aspen Dental Management and Heartland Dental Care were also in attendance. The DGPA represents about 30 members, which are dental service organizations that provide business management and support services to owner dentists for a fee. DGPA has about 7,000 affiliated dentists or dentist owners involved in large group practices.
Many members of DGPA are also members of the American Academy of Dental Group Practice, which was founded in 1974 when “group practice” was still a fledgling concept, said Bob Hankin, Ph.D., who manages the AADGP administrative office. An AADGP member is an individual group or a particular location that houses several dentists.
“Over time, groups evolved to having more than one location or office, but our focus remains that of particular locations and internal dynamics of shared resources, peer review, internalized referrals and specialties, dental insurance coverage, and the administrative, business and marketing characteristics associated with this delivery model,” said Dr. Hankin.
While large group practices may belong to both organizations, what tends to set the two apart is that DGPA has a smaller number of large groups as members and AADGP has a large number of smaller group members.
Not all group practices are interested in selling to a dental services organization either.
Kenneth M. Sadler, D.D.S. & Associates, P.A., a multispecialty group practice in Winston-Salem, N.C., is a member of AADGP.
“We have 10 owners and eight associate dentists who are employees,” said Dr. Sadler. It’s an ideal practice setting for him, he said. “There is a lot of exchange of ideas, you get to talk to other providers and discuss patient care issues, and you have a little more flexibility with being on call because it’s a shared responsibility.”
Has he ever considered selling to a dental services organization? “We’ve been in this business for 34 years, and we’re managing well on our own,” said Dr. Sadler, who said he has had practice management assistance in the past. “We can’t see any benefit to joining up with one of these consolidators or dental management companies.”
The biggest change on the horizon for Dr. Sadler’s practice is to start succession planning. “Some of us are growing older and getting to a point where we want to think about cutting back.” That could involve ownerships for the eight associate dentists in the practice.
Dr. Brent Barta, principal owner of West 10th Dental Group in Indianapolis, has grown his group practice in the past 11 years to add practitioners and office space. He now has a practice partner, specialists and a second office location. Coming out of dental school in 1984, Dr. Barta had the opportunity to work in a group practice and saw the benefits of that model.
“I believe that patients are given the opportunity to have a comprehensive treatment plan and they are more likely to follow through on that care because it’s provided in one location,” he said.
“I have goals for the practice and many things I’m still working on, but selling out to a dental services organization is not something I’ve ever considered,” said Dr. Barta.
“I’ve made good progress on what I want to accomplish, but if I sold out or partnered with a dental services organization, I might lose the ability to control aspects of the practice,” he continued. “I’d like to be able to set my own agenda and work on the things that are important to me instead of working with a third person who might not have the same priorities.”