As scary as it sounds that 60-70% overhead is actually very close to the normal average overhead of a dental practice in the U.S. (My office goes a couple percent either side of 60% each year depending on what types of capital improvement we make each year).
Sure you can cut the overhead in many ways (limited investment in new technology, "sqeezing" the wages of your employees, using "cheaper" labs for your lab work, deferring capital improvements to your office, etc, etc, etc.
I've tried many of those, and for me atleast it doesn't work. For exaaple, I find that the investment that me and my partner make/have made in new technology (i.e. hard and soft tissue lasers, digital radiography, electric handpieces, new chairs for patients/staff, etc, etc, etc) while expensive and adds to the overhead, ultimately make my life and my practice easier and MUCH more enjoyable. If you want to look at cutting lab costs, the truth is you can find a lab out that that will make you a PFM for $50-60 a tooth, and then you can find labs that will charge upwards of $200 a tooth. Put them side by side and you'll notice the difference, and so will your patients (both estethics/anatomy/ and ease of seating the crown factor in too). If your employees feel like your "cheaping" their wages/salaries, they won't be happy, and ultimately you won't be happy. Office image also makes a difference too(especially with the very profitable big cases). Now while my office in no ways resembles a "dental spa" - I don't have marble columns or plasma TV's all over the place, no aroma therapy or a masseusse on staff, it is very contemporary in its styling(okay as our designer puts it our "theme" is contemporary colonial) and doesn't look like "the 70's are still alive" in the waiting room or operatories.
As for the guy mentioned that says he's makng 5 million and takes medicaid, look into medicaid fees and then do the math about how many patients/proceedures he'd have to do to generate that. Plus, the medicaid administrative folks do look at quantity of proceedures that an office bills to help avoid "false" billing. I.E. if for every tooth your submitting a claim for, if your doing a pulp cap, or some other "non standard" proceedure all the time. You'll likely see an auditor(regular insurance companies do this too). Plus think about it this way. If that guys making 5 mill with 20% overhead, he's grossing roughly 6 mill, or $500,000 a month which is producing almost $21,000 a day(I figured actually working 24 days a month). Now at medicaid fees (things like $200 for an arch of dentures, $150 for a molar endo, $150 for a crown, $40 for a 1 surface restoration, $35 for a prophy) thats ALOT of people you'll be seeing a day!
