Just that - become practice owners.
Ask me anything about practice ownership
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Just that - become practice owners.
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How would you compete though? I assume DSO's will have 50%+ market share in 10 years. They have lower fees, better marketing etc.
Better marketing I'm not so sure about....
Their presence is also weighted differently across the US. You don't really have to worry about the brand-of-houses types, as much as the house-of-brands. Even if DSO's secure 50% of the market, it still leaves the other 50% up for grabs. Smaller DSO's will eventually be consolidated into 3-4 major players, since most of their exists are through multiple stages of arbitrage. Then, you will be left with a Kaiser/Sutter/etc and private practice settings.
Don't be dumb (start first office from scratch), stay away from HMO, have a game plan, and approach the practice as a business.
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What's the best way to become profitable running a Medi-Cal (Denti-Cal) practice?
Don't do it 🙂
Jokes aside, Denti-Cal practices rely on S/RP, though it requires pre-auth. Aside from that, when it comes to adults, most procedures are not covered and are out of pocket (fixed and rem pros) or can be uphold. It's very similar to an HMO style practice, where one has to do coding and billing acrobatics.
1) How did you learn advanced procedures?
2) What kind of procedures net you the most?
3) For a guy like me going to be in the $150k debt (spouse is a GP with no debt) - would you buy a practice right after graduation? Start-up or acquisition?
4) You still wouldn't recommend good AEGD programs like San Antonio etc.?
5) Would your motto be - get fast at bread and butter and then learn advanced procedures? How did you do it?
Again - THANKS!
2) What kind of procedures net you the most?
3) For a guy like me going to be in the $150k debt (spouse is a GP with no debt) - would you buy a practice right after graduation? Start-up or acquisition?
4) You still wouldn't recommend good AEGD programs like San Antonio etc.?
5) Would your motto be - get fast at bread and butter and then learn advanced procedures? How did you do it?
Again - THANKS!
1) What management software do you use for what?
2) Do you have centralized management or is each office run by itself?
3) Do you find any problem with associate turnover in each office? What is the incentive for staying in (what is their pay structure?)?
4) How many associates do you have per office and how many days a week do they work on average?
5) What are your office hours? (My current office is looking to expand to 7a-7p and open 7 days a week, not sure if this is a good move from 4.5 days, we are definitely busy enough for the expansion)
6) Do you find yourself in better leverage to negotiate your fee schedule with Delta with more offices? I assume your started with more than just Delta PPO, when did you start dropping insurances?
7) What lab do you use for your cases or is it all/some of it in-house? Are you using traditional impressions for crowns or is everything scan and mill?
8) How far booked out are you for hygiene and new patients?
Thank you!
2) Do you have centralized management or is each office run by itself?
3) Do you find any problem with associate turnover in each office? What is the incentive for staying in (what is their pay structure?)?
4) How many associates do you have per office and how many days a week do they work on average?
5) What are your office hours? (My current office is looking to expand to 7a-7p and open 7 days a week, not sure if this is a good move from 4.5 days, we are definitely busy enough for the expansion)
6) Do you find yourself in better leverage to negotiate your fee schedule with Delta with more offices? I assume your started with more than just Delta PPO, when did you start dropping insurances?
7) What lab do you use for your cases or is it all/some of it in-house? Are you using traditional impressions for crowns or is everything scan and mill?
8) How far booked out are you for hygiene and new patients?
Thank you!
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1. For someone who just graduated from dental school and is looking to have practice ownership, how long do you suggest them to wait until they acquire their first office?
2. Why do you prefer buying an existing office to starting something from scratch?
3. How do you manage your staff and associate when you start having your second or third office ?
2. Why do you prefer buying an existing office to starting something from scratch?
3. How do you manage your staff and associate when you start having your second or third office ?
Most of what you buy is goodwill, as the equipment value depreciates in 7 years. So, let's say you want to have that million-a-year production office, which these days means about 1000 patients, give or take. If you start from scratch, it would take you quite some time to build up to 1000 patients (let's say 30 new QUALITY patients per month = 2.78 years to reach 1000). Not to mention the amount of money you would spent on marketing to get there, all the while all fixed expenses would hit you from day one. On the other hand, you can acquire such a practice from a retiring doc for about 700K (practice valuation typically at 1-1.5x EBIDTA) with a 15-year fixed interest loan, financed 125% by any major bank. Better yet, get a consultant (this is what I do as a 6-figure side gig), buy an underperforming practice for under 400K and make it a million dollar office in 6 months.
1) take CE courses, watch others do it, start with basic and build up skill and confidence - takes years.
2) TMD/ortho, sedation, surgery, all-on-3/4/6/8
3) see above RE start-up vs existing; not right after grad, you need to marinade in a pvt practice environment for at least 6 months (can't buy a practice w/o some experience.
4) it's not about good vs bad. It's about ROI. In this case, you are investing 12 months of income and equity building for what? Mostly more basic procedures with some chance exposures at advanced stuff. Why not start practicing and take CE's in what you want to improve instead?
5) It's not a binary - you can get fast at basic operative while taking on the advanced procedures. Also, remember, "advanced" is a relative term. For example, UCSF curriculum treats molar endo like open heart surgery, whereas average OU grads end up doing a dozen of those. Same goes for surgery.
1) Dentrix
2) House of brands with central control of things like bills, ordering, payroll, bookkeeping.
3) Associates are hired guns - they come and go. Good ones go fast, band ones you can't wait to get rid of. My strategy is to have partners instead of associates. Either a buy-in for one of my existing offices, or, more often, a partnership where a less experienced doc buys a practice and exchanges 20-30% of ownership for my consulting/optimization/leverage positions. Leverage in this case means STEEP discounts for variable expenses (lab costs, supplies, marketing, etc). This way, they can buy an office that producing 700K and end up with a 1.4 mil in REVENUE in 18 months.
4) See above
5) ranges from 7-9am start and 5-6pm finish. Things for you to check would be (a) labor law in your state (some states consider anything above 8 hrs/day at overtime), as you may need to stagger employee shifts; (b) will your patients and STAFF be willing to be in the office at those hours; (c) is this better than being open an extra day; (d) if it's recall/hyg issue, why not add another hygienist and run a double or triple hygiene in the same day and expand another operatory, if possible; (e) if it's issue of you not being able to see more patients, consider working a little faster/smarter, double booking, or adding another RDA/DA for faster turnover. I very often see offices get in trouble by expanding without any optimization, which just results in minor revenue increase and major overhead gain. PM me if you want more specific advice
6) I don't negotiate with terrorists (or, in case of Delta, terrorists don't negotiate with you, regardless of how big you are). And no, always looked for offices to buy that were not insurance heavy.
7) Hardly no in-house lab work, though we are equipped for it in case of clutch situations. I am full digital flow (Trios) in all my offices and my lab picks up the tab on the cost of my Trios's. That's one of my leverage positions. It's a California-based lab that services all of US. PM me if you are interested in using them.
8) months and months, but of course, there are openings here and there. Combined, my offices have something like 22 days of hygiene/week.
1) Do you do sleep apnea appliances?
2) How many hours a week do you work (clinical and administrative)?
3) What courses did you do to use to get proficient in TMD, Implants, Molar endo?
4) Lastly, why not spend a year and invest in a good AGED clinically and save time and weekends that you would be spending on CE and improve your business? Thoughts?
Thanks again for all this knowledge; it is like candy land right now.
2) How many hours a week do you work (clinical and administrative)?
3) What courses did you do to use to get proficient in TMD, Implants, Molar endo?
4) Lastly, why not spend a year and invest in a good AGED clinically and save time and weekends that you would be spending on CE and improve your business? Thoughts?
Thanks again for all this knowledge; it is like candy land right now.
1) Not until (1) you can prep any crown in 15-25 min, do a class 2 in 30 min, and juggle 3 patients at once; and (2) understand every aspect of the workflow of a private office and the business aspect of running a 3-5 employee S-Corp (or pay someone like me 20-30K to explain that to you over a few months)
2) See posts above
3) same as you do in the first office, just takes more time. Remember, at a 2-3 offices you are acting (in addition to being a healthcare provider and all that is involved with it) as a CEO of a corporation that employs 20-30 people and has a revenue of 4-6 million. It becomes a 24/7 job. But if you have an entrepreneurial spirit, nothing else can replace this rush.
Dedicate certain days to certain offices. Hire the right people and partner with right doctors. Learn to delegate while keeping a close eye.
1) yes, but unlike some offices, we are strictly evidence-based practice. This means I require a sleep study, a consult w/ an ENT/sleep doc first. Then, if they agree that a sleep device for correction of mild OSA is worth a try, we go for it.
2) clinical 32-36/week; admin 24/7 (see one of my replies above)
3) different CE's from different institutions. For implants, by the way, UCSF is putting on a great 4 day intro hand on course in February (I'm one of the faculty). Check it out.
4) See above about why. Now, on the subject of "saving time and weekends" - you can have this mentality if you want to have a single office and work 8-5. Beyond that, it's a 24/7 commitment. Does it mean that I don't take time off? No, in fact I just came back from a 2 week vacation in Hawaii with my family. I haven't treated a patient on a weekend, outside of ER call, in 5 years. I take 4-5 weeks off cumulatively every year. But I'm always plugged in, always checking email, removing into offices, talking to new clients, and starting new ventures.
So you would recommend getting fast at proficient at bread and butter dentistry then adding skills based on your patient base? This is when you start owning?
I have read and seen many times with people going to top AEGDs and then getting a practice or an associateship where they don't have the patient base yet for advanced procedures (implants, fixed hybrids, etc.). The one thing I have read is getting good at molar endo (low overhead and high profit and usage - because you can put the crown on top). I feel like you might have the same mindset.
I have read and seen many times with people going to top AEGDs and then getting a practice or an associateship where they don't have the patient base yet for advanced procedures (implants, fixed hybrids, etc.). The one thing I have read is getting good at molar endo (low overhead and high profit and usage - because you can put the crown on top). I feel like you might have the same mindset.
You start owning when you feel like you are fast enough for general work. Add skills based on your patient base and your interest.
Makes a lot of sense to me. Why do you think people op for the AEGD and try to learn everything and do everything?
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Thank you very much for your response !
Do you think it’s very important to work in the same area as the places I am planning to start my practice ? I am debating if I should work in one of those remote area. I personably think it’s a place with some growth potential and less competition. But I would also want to eventually move to some other places after a few years.
How do you usually choose the practice location ?
Do you think it’s very important to work in the same area as the places I am planning to start my practice ? I am debating if I should work in one of those remote area. I personably think it’s a place with some growth potential and less competition. But I would also want to eventually move to some other places after a few years.
How do you usually choose the practice location ?
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How much do you charge for your consulting services? How can you tell if a dental consulting company is actually worth it and is not garbage? Do a lot of owners hire these companies or most owners do not think about this?
Depends on the department - if you want to teach predoc clinical, then you don't need a PhD (I think of all the UCSF clinical predoc faculty, only 5% have a PhD). If you want to be a tenure track researcher, that's a different ball game entirely.
Academia compensation is a joke compared to private practice, but better than most associateship gigs. As a 100% UCSF HS Assistant Professor who practices 1.5 days, you can touch a 200K total package (salary, clinical bonus, full benefits). When I was a 50% faculty (considered minimum for full benefits), my total compensation for 20 hrs/ week (with evening clinics and lectures, it meant giving up 1.5 days of practice), my total compensation was around 60K, but I wasn't practicing in faculty practice at all. If I somehow was, I would venture to say it would be close to 120K.
It is totally doable to run a practice and teach - most of UCSF faculty are part-timers. It becomes difficult once you start scaling to multiple offices. This was when I had to step down as faculty and now contract/volunteer as a CE and guest lecturer.
It's preferable, as you get a good sense of the demographic. Remote areas may mean little competition, but they may also mean limited growth potential. For example, my practice in the heart of Berkeley has grown 100% in 12 months (granted, it's cause I consult on this stuff for a living and am pretty good at it), whereas my practices an hour to 1.5 hrs away from San Francisco are only seeing 20% annual growth (still great, but not stellar). In addition, remote areas have the risk of a demographic downturn. You should also consider if a remote/small town lifestyle is for you.
That being said, I always buy existing, so location is not a major factor to me. My analysis consists primarily at the historic performance of the business. In dentistry, businesses are acquired for a crazy-low valuation. For example, Amazon has a yearly revenue of ~240 billion, yet is valued at over a trillion dollars. In comparison, a dental practice w a revenue of 1 million dollars, would be valued at ~750K. This means, that even if the practice I acquire is a dud and can't be improved, I will still get my investment back in 3-4 years and then sell it at a profit of at least 500K.
Finding a good consulting service is challenging. I recommend looking at the consultant. Is he/she in the business themselves? Who are they - a hygienist, an office manager, a dentist, a random business "guru"? Have they actually achieved for themselves what they are promising you?
My firm operates on a referral-basis, with clients coming either from several well known dental law firms/CPAs and from former clients. I also have some clients who are former students or have attended my CE courses at UCSF.
If you want to know more about what I do, PM me, I'll be happy to chat about specifics.
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I need your financial advice regarding buying a practice after graduation.
I am a "non traditional" D1 who will have no debt when I graduate.
I am a real estate investor and went to dental school because it was interesting, good ROI, etc.
Starting next week a lot of my assets will be in cash (~750K), and I need to make some decisions on how to invest over the next 4 years. I'm looking to own a practice ASAP, within 4-5 years from now. The 4-5 year mark is an awkward timeline for investing and I just need a straight answer for how much cash to have on hand when it comes time to buy. I know next to nothing about practice loans, down payments, etc. and am slowly picking up practice valuation, demographics, etc. from podcasts and dentaltown. I've been toying with the idea of buying an under performing 300-500K practice with cash and keeping overhead low. Anyway, what would you do? Take out a loan? How big of a down payment/how much cash would you use when you go to buy?
I am a "non traditional" D1 who will have no debt when I graduate.
I am a real estate investor and went to dental school because it was interesting, good ROI, etc.
Starting next week a lot of my assets will be in cash (~750K), and I need to make some decisions on how to invest over the next 4 years. I'm looking to own a practice ASAP, within 4-5 years from now. The 4-5 year mark is an awkward timeline for investing and I just need a straight answer for how much cash to have on hand when it comes time to buy. I know next to nothing about practice loans, down payments, etc. and am slowly picking up practice valuation, demographics, etc. from podcasts and dentaltown. I've been toying with the idea of buying an under performing 300-500K practice with cash and keeping overhead low. Anyway, what would you do? Take out a loan? How big of a down payment/how much cash would you use when you go to buy?
Most banks have a practice solutions departments, which sell similar products. Today you are looking at 125% 10-15 year loan with zero down and an interest rate at around 3%. Banks just need to know that the office has someone who will be able to produce enough to cover the mortgage payment. So, if you have other RE opportunities now, go ahead and invest in them without the worry of needing liquidity for practice purchase.
Good to see you still posting on these forums!
I totally agree. I do just bread and butter dentistry. I use to take any insurance from all walks of life in the beginning - and it was fun doing it, the big and beautiful learning curve. Now I work 28 hours/week and am very selective with the cases I do and the insurances I accept.
The key - work hard for the first 5-10 years of your career, and I mean give it close to “all” and then slow down the next 5-10 years, and finally have a meaningful choice to retire happily in your own office (or walk away from it all) the last decade or so of your career. It’s just the natural route, work very hard at your most productive years, and slow down as you age. Ofcourse, you have to be smart doing that too.
I think if you are not content financially about dentistry in your 40’s, then there is a strong chance that you will not be having a soft landing to retirement. Get everything in order early, so you can have less to worry about later. The same basic rules applies to everything else in life - just don’t expect to be a dentist that will be successful by default from your first job.
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And this is exactly why limiting debt is important. Tough to be content financially by 40s if you're still paying off a 60k a year student loan note.
I know dentists in their late 50’s still paying off their student loans. They were in bad marriages, partnered with the wrong people to open and run a practice - and eventually failed, they just simply did not have the motivation and just sailed along their career. One of them told me “I have no intention of paying off my student loans and I’m ok if it follows me to the grave”. Yes, this guy was a dentist, and I could tell from his voice - that he had bigger issues on his mind and deal with. Those are the kind of dentists that are financially on the other side of the tracks. A divorce, a major death of a loved one/a close person, a failed expensive practice, and the likes - can easily dwarf the worry about student loans.
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Yikes! And to think, these financially unsavvy dentists will still exist in the future, the difference is their student loans will be magnitudes higher than the dentists you know.
Are there any other dentists on here that would not do an AEGD and rather work and get fast at bread and butter procedures and then take CE on the more advanced things?
There are a growing number of students that do the AEGD for things like 3rd molar ext., molar endo, IV sedation, and implants from the get go.
What do you all think about the different scenarios?
There are a growing number of students that do the AEGD for things like 3rd molar ext., molar endo, IV sedation, and implants from the get go.
What do you all think about the different scenarios?
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Do the specialist doctors make more as professors or not really? Also do you think you get paid more if you work in a rural university vs LA. What is the typical personality of these people who go this route vs private practice dentistry. Did you really enjoy teaching or is this overhyped? Do you find the teaching more enjoyable then private practice in terms of the actual activity?
They may if they work in faculty practice. Salary is not dependent on that, though.
Different universities have different pay structures, but I’m not familiar with a “rural” dental school 🙂
The answer to the rest of the questions is it varies.
I am only a D2 but I am considering working in California in the future due to family there (central valley). I know you've touched on this in your other responses, but any other tips you have on running successful practices in California specifically? How did you decide where to open? Are there any areas left where competition is not as fierce? I know you mentioned location is not as big a factor when you buy existing but I assume that comes with its own challenges in itself.
1) When you say you net between $650k-1m per year from your offices, how much of this income would you say is your own production and how much from other dentists?
2) How long did it take for you to establish there 3 offices (I'm assuming 5 years- after you finished your PhD)?
2) How long did it take for you to establish there 3 offices (I'm assuming 5 years- after you finished your PhD)?
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This is just n=1, but in my experience even the rural areas are getting pretty saturated. I go to college in a pretty rural college town, 3-4 hrs from a major metro, and it's littered with dental offices and even corps like Aspen Dental. This is in the middle of a cornfield btw....you can't get more rural than this.
It seems to me you can't escape saturation in dentistry. Our only hope is that the dental education bubble bursts like 1980s, and the supply of dentists is greatly reduced.
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What does your average associate who is <2 years out of school make?
Where did you learn the things that made you successful and now consult on?
Where did you learn the things that made you successful and now consult on?
I did a GPR and am of the opinion that most AEGD/GPRs are a waste of a year. If your heart is set on successful dental ownership, the fastest way to get there is to do what laundry mentions in this thread - get real fast and proficient at the basics (an AEGD does a relatively poor job at this compared to a real production-based office), open up shop as soon as possible, and then add on advanced procedures based on your interest, and on the needs of your patient demographic. I honestly don't think any AEGD can stack up to 60k worth of CE (the difference in salary between a residency and a starting associate salary). And there is CE for every procedure you mentioned.
Going into an AEGD expecting to come out in 1 year fully proficient in 3rd molar exo AND molar endo AND IV sedation AND implants is a pipe dream unfortunately. In reality, if you're lucky enough to be in a program that offers those cases, you may get enough exposure to know how much you don't know.
Although I do admit there are competitive programs with very good reputations that may be worth it. You'll have to do the research to see if they are.
This is all just my opinion based on my experiences.
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Sry for delayed response, but without quoting, I get no notifications.
1) solid areas = areas with a net positive demographic trend. In other words, places with an increase in population. Also look at average income to be at or above average for your general area. For SF Bay Area that means 150-200k+ median household income.
2) on going rural - rule #1: practice where you want to live. You get only one life and there is no reason to chase money thru sacrifice of daily life. So, if you want to live in a rural setting, go for it!
3) CA - I wish i could give a template for success in CA in a single forum post...In reality, every practice is different and it takes months of work to dial in the success formula.
1) Not counting hygiene/recall, I probably produce 1 mil.
2) Seeing that I finished my PhD in 2015, that math is correct 🙂 though my first office was bought in 2013
1) ~180-250
2) In the order of significance: experience (trial/error); personal research; formal business training (HBS); some of my PhD work touched on quant analysis
Do these associates have top notch AEGDs? The issue is that a lot of employers want at least a residency or work experience.
No. Maybe some employers seek out AEGD grads. I have hired both straight out of school and AEGD and have seen greats and duds in both scenarios.
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What do you believe are some aspects that make a successful private practice?
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Laundry, what are your thoughts on how this pandemic will change dentistry? COVID-19 will eventually be under control, but maybe this will take multiple shelter-in-place orders as it comes and goes in the next couple of years. I also think it's inevitable that other viruses like these will arise. It seems likely we are going to have to change PPE protocols and perhaps even outfit our offices with various filtration devices. Will patients worry about transmission of aerosols in the dental office and be less likely to visit the dentist?
OSHA and CDC will definitely have new guidelines and the way dental offices operate/see patients; from number of people in the waiting room, number of people in each treatment room, to number of elective cases on the schedule at each office per day. All busy practices will be severely effected. It’s the new reality.
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