P RESENTED BY C HARLES B LAIR , D. D. S. C HARLES B LAIR , DDS I VE - PowerPoint PPT Presentation

THE FUTURE OF DENTISTRY THE RATE OF CHANGE IS STAGGERING. P RESENTED BY C HARLES B LAIR , D. D. S.

C HARLES B LAIR , DDS “I’ VE NEVER SEEN ANYTHING LIKE IT !”

S O , WHAT ’ S HAPPENING ?

I N A N UTSHELL … • PPO’s are Dominating the Types of Plans • A Shift to Corporate Dentistry • A Shift from Solo to Multi-Doctor Practices • Entrepreneur Dentists Owning 2-5 Practices is increasing • 4,000 Labs Going Out-of-Business in 4 Years • 35% of Crowns are Made Offshore • $100,000 Per Year for Private Dental Schools • More Patients with Less Money and are Deal/Discount Oriented

T ODAY ’ S D ENTIST  Passion is Dentistry  CEO/Wears the “Hats”  Business activities distract from patient care or they are ignored  Cottage Industry-generally solo, some multi-doctor  Don’t think corporately

A REAS OF C ONCERN Startling Shift to PPO Plans  Dilemma of When (Not If) to Join PPOs  Lack of Busyness for Many  Continuing Sick Economy  Negative Patient Conduct/Skeptical  Patient Shift to Value/Negotiating Attitude  Concern for Overtreatment and Ethics  Corporation Encroachment  Concern for Sale of Practice and Retirement 

S O WHO ’ S IN AT LEAST ONE PPO?  Out-of-Network < 15% of dentists  PPO Participation > 85% of dentists

C URRENT S TATUS – N ON -PPO P RACTICE  new patients and  busyness  Revenues are down only 5% - 10% in many cases  Living off the practice for the last several years  Running off patients, not gaining patients  Poor front desk communication with new PPO patients calling  Poor recall system with patients leaving for PPO dentists 

A SSOCIATESHIP A VAILABILITY Non-PPO practices are suffering – no associate capacity  Retirement plan balances  , dentists are working longer  Increasing corporate opportunity for employment, check JADA  ads., etc.

N ATIONAL D ATABASE – B IG B ROTHER !  2 – 3 Database Companies  Contributions to the dentist database are made by insurance companies  Procedure mix of 175,000 dentists are spotlighted  Data is used to target over utilizers  Will be used to restrict or exclude providers  Will be used to recruit Exclusive Provider Organization (EPO) networks

T HE C OTTAGE I NDUSTRY OF D ENTISTRY I S UNDER ASSAULT …

F UTURE OF D ENTISTRY  Dental PPOs are at a tipping point and mirror medicine’s – Now!  **MUST PRODUCE MORE TO HOPE FOR THE SAME INCOME**  Dentistry is a $115 Billion industry and corporate dentistry will increase. It is compounding from $6 billion of revenues (largest corporations) - - A tipping point!

S HIFT TO M ULTI -D OCTOR P RACTICE • Many more two-three doctor practices, solo is declining • More entrepreneurial dentists owning 2 – 5 practices • Many more large corporation practice locations with 2 – 3 doctors with 2,500 – 3,000 square foot facilities

D ENTISTS SCOFF UNTIL REALITY!

D ENTAL P ROFESSION ’ S F UTURE Must produce 20-25% more (In hopes to make same income.) No one is not immune!

L ET ’ S L OOK AT C ORPORATIONS

M OST ARE CORPORATE NOW !  Restaurants  Office Supply  Small Bookstores  Small Jewelers  Small Groceries  Funeral Homes  Drug Stores  Hometown Banks  Hardware Stores  Physicians  Sports Stores  Dental Supply Dealers and Labs Who’s left standing? Who works four days a week? DENTISTS Are Next!

C ORPORATE D ENTISTRY T ODAY  Cleaning house - 3,000 locations!  Moving from low end to middle market consumer  After the consumer, who is price sensitive and needs financing  Accessible Care/Accept PPO Plans/Insurance Friendly  In-house discount plans for non-insurance patients – A growth market  Convenience/Parking/Specialist on Site  $6 billion industry - A tipping point!  Hospitals or insurance companies could get into the mix

D ENTAL M ANAGEMENT S ERVICE O RGANIZATIONS (DMSO) Types: A. DMSO Owner – Non-dentist ownership B. DMSO – Management only – They will allow private-owned practice to thrive. Co- ops will evolve. DMSO’s could save a cottage industry! C. Hybrid DMSO – two of the basic types

D ENTAL M ANAGEMENT S ERVICE O RGANIZATIONS (DMSO) Cold Start Model – Less stable DDS providers/heavy 1. advertising. Buy and Grow Model – More stable DDS providers who were 2. bought out and they remain. Sometimes they are mentors for young dentists. This is a decreasing model for large corporations.

N ON -O WNERSHIP DMSO-S ERVICES O NLY Predict these will be formed  True non-ownership of practice – DDS owns practice  Compensation  Fixed Fee  Variable Fee - Is this fee splitting? 

L ET ’ S C OMPARE C ORPORATIONS VS . T YPICAL D ENTISTS

C ORPORATE T HINKING : I S THE PRACTICE FIRST ?  Corporation – Yes – They maximize profits through capital spending first and then go for the bottom-line return.  Traditional Dentist – No – Often the home cash flow requirements win! Practice spending vs. home spending is at odds.

1. C ORPORATE VS . T YPICAL D ENTIST C ATEGORY C ORPORATION T YPICAL    P & L Cost Accounting     Metrics/Monitors/Goals     Modern Facility    Convenient Location     In-House Discount Program    Convenient /Expanded Hours     Marketing/Advertising   

2. C ORPORATE VS . T YPICAL D ENTIST C ATEGORY C ORPORATION T YPICAL    Business Staff Training  Poor    PPO Negotiation  None  Higher PPO Reimbursement  Yes     Coding /Administration Fair     Hiring/Screening     Doctor CE Fair     Third-Party Financing Fair 

3. C ORPORATE VS . T YPICAL D ENTIST C ATEGORY C ORPORATION T YPICAL   More $/Employee Output     More $/Square Foot Output   Expanded Procedure Mix –     Endo/Ortho   Specialists on   Site/Convenience

4. C ORPORATE VS . T YPICAL D ENTIST C ATEGORY C ORPORATION T YPICAL    Conflict Resolution     IT Department     Best Practices    Mentoring Environment      Screen Dental Technology  Fair    A/R Management  Good  Payroll  Even  Even

5. C ORPORATE VS . T YPICAL D ENTIST C ATEGORY C ORPORATION T YPICAL    Lower Overhead     Lab Bill     Supplies     Lower Fees  Gross under-treatment of Perio  Under-treatment  Rare    Much Less  DDS Turnover  High* *Low in some models

6. C ORPORATE C RITICISMS !* C ATEGORY C ORPORATION T YPICAL  Overtreatment  High  Some  Sloppy Work  High  Some  Pressure to Produce  High  Some  Money Hungry  High  ? *View of mainstream dentists.

M EDICAL M ODEL E VOLUTION Large Group Small Hospital Solo Group Owned • Multi- Location MD 50% W-2 (2012) Insurance Industry Owned? MD 70% W-2 (2014)

D ENTAL M ODEL E VOLUTION Large Group Small Corporate Solo Group Owned • Multi- Location Insurance Industry Owned?

F UTURE OF D ENTISTRY GPs become more decathlon providers through technology – Expanded  procedures, including implants Less need for Specialists (Except Pedo)  Some Specialists will not have their own facility  Mid-Level Providers – Starting at Zero Number Now  Hygienists (RDH) – Periodontal Therapist (RDH)  Assistants – Prophylaxis (Scale/Polish)  Expanded Function Restorative Assistants (RDH/DA)  Less need for dental schools/dentists because practice output will greatly  increase.

D ENTIST S TRATEGY (F OR N OW ) Think corporately, not like traditional dentist.  CHANGE WORKFORCE LAWS FOR EFFICIENCY BUT ALSO  BETTER PATIENT CARE Treat Periodontal Disease – You Must – Now!  Improved Communication to Convert N. P. Calls  Improved Communication to Retain Recall Patients  Expand Clinical Procedure Mix  Provide Moderate Clinical Treatment Intensity 

S TRATEGY (F OR N OW ) C ONT . Increase Case Acceptance  Intraoral Camera  Digital X-Ray  Third-Party Financing  Patient Education Software  Depending on the local market, may consider Delta Premier and Cigna  out-of-network. Get more efficient   Same-Day Dentistry Capability  Unbooked (Extra) Operatory  Modernize facility/equipment

S TRATEGY (F OR N OW ) C ONT . Take Emergencies & Children  Hire a One or Two Day Associate  Shift to a Two Dentist Practice – Share Facility  Emphasize a Stable Patient Relationship – No Turnover of Dentist in  Your Practice Convenient Hours/Patient Financing  Insurance Friendly  Market   Website/Advertise Consider In-House Discount Plan (This is the FUTURE)  Consider Consultants 

S TRATEGY (L ATER ) C ONT . Hire DMSO (Non-Owner) to manage the practice – no ownership by  DMSO. Co-Op  Marketing  Lab  Supplies  PPO Negotiation  Systems /CE  Share Out-of-Network Facility 

H OW TO BE COMPETITIVE IN THE F UTURE S HORT /L ONG T ERM