'Industry feels even better than it did a year ago'
March 05, 2012
At the end of a calendar year, dentists could typically look forward to patients coming in to use up their insurance benefits before their yearly maximums were exhausted.
Those actions would then lead to an uptick in the results shown in the fourth quarter results of the ADA’s quarterly Survey of Economic Confidence. After the surge in year-end patients, dentists would report a higher net income, treatment acceptance rates and gross billings.
Dr. Kevin Sessa
Results from the fourth quarter of 2011 survey show a bit of an uptick, but the ADA’s Health Policy Resources Center isn’t attributing it to an increase in patients using their benefits before the end of the year.
Fifteen percent of dentists indicated an increase in patients trying to use their dental benefits by year-end, while 64 percent indicated that number remained about the same, according to survey results. About one-fifth indicated a decrease in patients using up their benefits.
“The fact that only 15 percent of respondents reported an increase in billings for this reason and the majority, 85 percent, reported the same or a decreasing level could indicate greater worker confidence in continuation of employment and benefit terms,” according to an executive summary published by the Health Policy Resources Center.
Fourth quarter results for 2011 show that one out of five dentists who responded to the survey indicated their net income was higher than in the third quarter. Nearly one-third said their income remained the same.
In addition to the ADA’s findings, there are also external signs the dental market is improving. Jeff Johnson, an optometrist and a senior medical technology analyst for Robert W. Baird & Co. Inc., a financial services firm, who studies the dental market, said he saw a difference in the dental market between the fourth quarter of 2010 and the latter part of 2011.
“It sounds like the industry feels even better than it did a year ago, and dentists are starting to see an improvement in patient volume and better cash flow,” said Mr. Johnson, who has also seen the sales of dental equipment bounce back.
Nearly 1,700 dentists responded to the survey conducted by the Health Policy Resources Center. They were asked how net income, gross billings, numbers of new patients, treatment acceptance rates and several other indicators performed relative to the previous quarter. Although net income was up for some dentists, the other indicators showed less positive results.
- The number of new patients measured in the fourth quarter was better than in the third quarter of 2011 but the numbers remain low. Eighteen percent of respondents reported a higher number of new patients; 44 percent said it decreased; and 38 percent stated it remained the same.
- Gross billings decreased in the fourth quarter for more than 42 percent of respondents while 34 percent reported no change.
- Treatment acceptance rates decreased for nearly 39 percent of those polled while 54 percent reported no change.
Dr. Kevin Sessa, member of the ADA Council on Dental Practice’s Subcommittee on the Economy, said he’s hesitant to get excited about an economic recovery based on survey results from one quarter. But he is trying to look forward.
“Though there are some recent economic and employment data to suggest that perhaps the U.S. is beginning to recover from its economic woes of the past three to four years, most likely, based on other economic indicators, it will be some more time before we get back to any semblance of real economic stability nationally and/or globally,” Dr. Sessa said. “Therefore, all U.S. dental practices need to make sure that they are operating lean and mean to survive.”
Dr. Sessa encourages all dentists to keep their eyes on the big picture, despite the economic woes their practices may be facing, .
“All dental practices need to review their mission and be certain that they and all their employees are operating in a clinically high quality, patient-centered manner as this is the best way to ensure that patients continue to utilize dental services,” Dr. Sessa said. “Further, it gives patients of record impetus to refer their family and friends as new patients, which is the economic lifeblood of any dental practice.”