Where Does The 800-Practice DSO Sit? Wherever It Wants

Joining the ranks of the “big guns” in dental service organizations, Pacific Dental Services (PDS) announced on December 31st that it has reached the milestone of its 800th supported dental practice.

By contrast, Heartland Dental states that its supported practices total some 1,400. Aspen Dental counts more than 600. What’s impressive about the rise of PDS is that according to one source, the company had “only” 500 locations as of 2017.  A 60 percent increase in less than three years is an impressive growth rate by anyone’s standards.

That growth is not a fluke, however. According to Yahoo Finance, “Pacific Dental Services… announced last summer that for the 14th time it has earned a spot on the Inc. 5000, Inc. Magazine’s exclusive ranking of the nation’s fastest-growing private companies.”

Should You Or Shouldn’t You?

There’s no doubt that DSOs offer a lot of advantages for the solo dentist or small practice. With the DSO handling everything from negotiating and ordering supplies to dealing with the many faces of insurance, a considerable load is taken off dentists and team members alike.

Not only that, but participating dentists enjoy economies of scale that help them remain highly competitive. The corollary, of course, is that dentists who don’t join a DSO may be unable to compete. With the traditional price-based approach to attracting new patients, the practice at the lowest price-point wins. However, that’s an inescapable fate, as you’ll see.

Against those advantages are the potential disadvantages of DSOs. These organizations are strongly growth-minded, not only in terms of acquiring more practices but also in terms of making those practices more profitable. Depending on the corporate philosophy, that may translate into earlier and later hours of service, more days open per week, and considerable staff stress and even burnout.

Or, the DSOs philosophy may translate into constantly trying to upsell patients – something that can demoralize even the best dental teams over time.

There’s also the question of whether the dentist(s) continues to own the practice, or becomes a highly compensated employee. 

So, the decision on whether to join a DSO has a number of facets, all of which require considerable deliberation and a careful analysis of the contractual terms.

Can You Remain Independent And Thrive? Yes.

While DSOs might seem like an unstoppable juggernaut, independent dentists don’t have the forced choice of joining or failing. There’s another route, and it’s one that Dr. Michelle Haynes of Colorado decided to take.

“Here in Colorado,” she said,  “we have a ton of corporate dental offices. When we check and do searches, we’re able to pop up above them so I really think that we’re able to compete with those huge, huge practices in spite of being a private practice.

“Since we’ve been working with SmartBox, we actually have had a 30 percent or higher growth each year. Which is pretty incredible, so we’re thrilled about that. We’ve been thrilled to see that we’re averaging about 20:1 with our return on investment with our marketing dollars spent. And it was even as high as 50:1, so that has been pretty exciting to see the overall growth that we’ve managed to accomplish.”

If you’re concerned that an “800-pound” DSO may sit on your market, consider scheduling a Practice Growth Call. It’s not a sales call in any sense. You and Ashley Best – one of the top practice growth experts in the country on anyone’s short list – will discuss your goals, your current approach to marketing, your competition and what’s working (and not).

Following the call, an entire team of experts will prepare your Summary of Findings and your Practice Growth Roadmap

You may not be able to keep a large DSO from sitting on your market… but you can keep it from sitting on you.