ADA News

Cautiously optimistic.

The hesitant phrase is how dentists are describing the 2010 first quarter results of the ADA Quarterly Survey of Economic Confidence, which by most indications points toward an upswing in the economic climate for dentistry. The ADA and dentists are encouraged by the report but say it may be too soon to make definitive predictions.

The first quarter tends to be a positive one, but it's also the second consecutive quarter where several indicators looked favorable.

"While I am encouraged, I would say that we need another strong quarter of positive upward trends before I would say that dentistry may be seeing a slight easing in the present economic situation," said Orlando, Fla., dentist Dr. William D'Aiuto, member of the ADA Council on Dental Practice. "Almost everyone has a good first quarter. I would be cautious that what we're seeing is actually people feeling euphoric with the rise of the stock market. Also, the first quarters of most years are usually stronger than the second and third quarters."

Dr. Halasz

More than 1,900 dentists responded to questions about how net income, gross billings, new patients, open appointment times and several other indicators performed compared to the previous quarter. The 2010 first quarter survey was the seventh in a series of reports that collected information regarding the current economic condition of dentists' practices as well as their thoughts on future economic conditions.

The majority of dentists surveyed said they remain confident about future economic conditions. Nearly two-thirds reported they are either "somewhat confident" or "very confident" that the economy will improve.

Dr. Michael Halasz, who practices in Dayton, Ohio and chairs the Council on Dental Practice's Subcommittee on Economic Issues, also says he's "cautiously optimistic" about the future. Dr. Halasz saw an increase in gross production and the number of new patients in the first quarter of 2010, similar to what he recorded in 2008, one of his better years.

"I think a better indicator will be the next couple of quarters, because I think the quarter from April through June and then July through September really will give us a better idea," Dr. Halasz said.

Among the findings:

• The percentage of respondents reporting their net income had increased rose to 27 percent.
• One-third indicated an increase in gross billings.
• About 19 percent reported a decrease in open appointment times.
• A rise in new patients was indicated by 21 percent of respondents.

"The generally positive news is not to say that the overall economy is robust," stated an executive summary of the 43-page report. "At best, we are in a stabilization period with a slightly positive trend."

National statistics are not as optimistic. Regional and state unemployment rates were generally little changed or slightly lower in April compared to March, according to the U.S. Bureau of Labor Statistics. Thirty-four states and the District of Columbia recorded unemployment rate decreases, six states had increases and 10 states had no change over March. The national jobless rate increased by 0.2 percentage point to 9.9 percent, up from 9.7 percent in March.

There were more marked changes over one year ago. The unemployment rate increased in 38 states and the District of Columbia, 10 states reported decreases, and two states had no change over last year. The jobless rate was also markedly higher than it was in April 2009, when it was 8.9 percent, according to the labor department's April report.

The growth in dentistry could be because of new insurance benefits at the beginning of the year, Dr. Halasz said. After the first of the year, people have new insurance money and they want to use it, he said.

The rush to take advantage of dental benefits also happens at the end of a calendar year, when people realize they will lose their yearly benefit, Dr. Halasz said.

"Summer time is always a true test of what's going on," Dr. Halasz said. "Families are vacationing, have other things to do, and if they have extra money, they might go to the dentist."

But the growth may also be because dentists learned to be better managers during the recession, Dr. D'Aiuto said. They figured out how to cut their overhead costs to match their production, he said.

"I think we've become better CEOs of our health care businesses," Dr. D'Aiuto said.

The next quarterly economic survey is scheduled to be released in July and, until then, dentists and the ADA will be waiting to see if the last two quarter results were a fluke or the beginning of something more promising.

Members can download the survey for free by visiting the Dental Practice Hub, a resource created by the Council on Dental Practice to help members survive and thrive in their practices. On the web, visit www.ada.org/members/1554.aspx.