Greetings everyone. I have an interview Friday and have been brainstorming potential tough questions and came across this one and wanted everybodies insights and opinions.
"What do you see as the greatest challenge you will need to overcome as a dentist? How will you overcome this challenge?"
I thought about talking about increasing student loan debts to dental students but I feel like this may be a touchy subject to talk about to an adcom... thoughts? And how would you answer this question?
The Challenge
One huge challenge is the change in insurance reimbursement rates. Premier => PPO => EPO/HMO
I work in a dental office in California and my dentist is a member of the Delta Premier program which is a top-tier insurance program with the highest level of reimbursement. For example, the insurance allows a contracted fee of $1000 for a crown under this program (note: this varies for each provider). This is not a high rate of reimbursement but it is competitive.
The Delta Premier program is already being phased out for the Delta PPO. Dentists who are currently in the Premier program are "grandfathered" in but any new dentists signing up to be in-network for Delta are required to be PPO providers. Under the Delta PPO plan, the exact same crown procedure will only have a fee of $500 for a crown.
Keep in mind that the lab bill for a crown is at least $100, the procedure requires 3 hours of assistant time $50-75. Scheduling, confirming, and processing the insurance for the crown by the front office is probably around $25. The rent, utilities, and equipment depreciation is another $25. As you can see, the profit made on this procedure went from $700 under Delta premier plan to $250-300 under the PPO plan.
The same crown under an HMO plan may only have $200-300 for reimbursement. There goes all of the profit. Changing reimbursement rates is one of the many reasons why Corporate dentistry is on the rise because they have greater economies of scale, bargaining power with distributors, and shared overhead.
The "Solution"
There aren't any quick and easy solutions to this one. A couple small ideas: CAD/CAM crowns can reduce the cost of the lab bill and keep the profit from making the crown in the practice. In theory, CAD/CAM could also reduce the amount of assistant time in taking impressions & creating temporaries and front office time scheduling the appointments. Part of the solution may also be grouping up with other dentists so that you can share overhead costs and also have some of the economies of scale that corporate dental chains. There is not a simple solution to this problem but it's a good one to start thinking about because the profitability of a small private practice is definitely declining.