Is a Traditional Practice or a Group Practice Right for a Dentist?

Here is another guest post from our friend Carl Guthrie at ETS Dental.

Twenty years ago, the vast majority of dentists were solo practitioners who called their own shots and ran their own businesses. Today, group practices represent a significant percentage of the market and now provide an alternative to traditional solo practice. At this point in your career, which setting is right for you?

We have placed hundreds of dentists in both group and traditional settings. While walking a job seeker through the decision process, we consistently hear the same set of "pros and cons" offered for both settings. Here is an overview that we hope will prove helpful to any dentist considering a new position.

There are many types of group practices. For the purposes of this blog I will define traditional practices as those that have a sole practitioner or two partner doctors. Group practices include corporate groups, offices run by practice management companies, and private practices with three or more doctors.

Traditional Practice:

Pros:


• More income potential as a practice owner or partner
• Freedom to run the office as you see fit
• Freedom to pursue your own clinical interests
• Equity position is more likely

Cons:


• Complete responsibility for the practice
• Many hours of administrative work outside of clinical hours
• Balancing clinical CE with business development training
• Practice growth is your responsibility

Group Practice:

Pros:


• Limited or no administrative responsibilities
• Limited or no time required outside of office hours
• Reduced overhead could improve compensation
• Collegial setting
• Larger marketing budget
• Ability to specialize within practice
• Mentors available – clinical and business
• CE program in place
• Ability to negotiate higher fees from insurance companies
• More funds for equipment and technological upgrades
• More common to find benefits packages include group health insurance, 401K, and more

Cons:


• Less clinical autonomy
• Less or no control on business of the practice
• More colleagues to disagree with
• Quality of colleagues work reflects on you
• Less freedom to pursue niche
• Equity position less likely
• Higher staff turnover

This is certainly not a complete list of all the varying aspects of these two settings.

Contact Carl Guthrie with any questions you may have.

Dental Associate Agreements

Here is a guest blog post from our friend Carl Guthrie from ETS Dental.

Associate Agreements (contracts) can suffocate us at a time we should be reveling in a new opportunity.  However, many dentists don’t understand what is in their contracts, in turn complicating the process and turning this joy of new opportunity into a whirlwind of anxiety and trepidation.

This article is not intended to be legal advice.  

ALWAYS consult an attorney or legal expert in your jurisdiction.

Here are a few points to pay attention to when reviewing your Associate Agreement:

1. Employee or Independent Contractor:  Regardless of the debate on what is technically legal or acceptable by the IRS, make sure you know which status you are agreeing to.  If taxes on income are not paid correctly, it could come back to bite both the associate and the practice.   Consult a CPA or Attorney on what is correct for your situation.

2. Compensation: Are you going to be paid on collections or on production?  These two do vary, but don’t get stuck in the mindset that production-based income is the only way you will accept to be paid.  Keep in mind that even if you are paid on production, many practices will adjust your future paycheck if there are any unpaid patient balances or write-offs.  In essence, you are being paid on collections anyway.

3. Notice Period: The length of termination periods are widely becoming 30 or more days long.  We’re seeing more and more asking for 60 to 90 days notice.  Understand what is required of you to terminate your employment with a practice.  

4. Restrictive Covenants and Non-Compete Clauses: Dental practices will protect their interest by requiring you to agree to some sort of restrictions upon the termination of your employment.  They will restrict you from practicing dentistry in any capacity within a certain distance for a specified length of time.  There will be other language that restricts you from soliciting patients or staff for a specified time period.   Distance varies upon geography.  For example, rural areas can have 20 miles or more of a restricted zone, while a metro area will be 2 to 5 miles.

5. Lab Expenses:  Most practices are paying these costs; however, make sure to ask if you will be paying for any lab expenses.  There is no real standard on this in the industry.  Practices will have associates pay for half or an amount equal to the Associate’s percentage of pay.  Also, make sure you understand the formula for calculating your pay with lab expenses.  You want the lab expense to be deducted from the total production prior to calculating your percent of pay.  {Pay = % of production * (Production – Lab expense)}

These are just a few of the “biggies” that develop in contract negotiations.  Again, refer to your attorney for precise legal advice.

Posted by Carl Guthrie, Senior Dentist Recruitment Consultant with ETS Dental. To find out more, call Carl at (540) 491-9104 or email at cguthrie@etsdental.com.