Why solo practice is a poor fit for the future

February 8, 2017

A look at the future of dentistry and how solo practices will fit into it.

Nortel, formerly known as Northern Telecom Limited, was one of the largest manufactures of payphones. Their series 200 was a nickel-plated phone that gained huge acceptance in the 50s and early 60s.

Nortel upgraded from rotary phones to the push-button phones in the late 60s with their Centurion series. Finally, in the early 90s, Nortel came out with Millennial, which could not only take coins but now also take credit cards. Their customers included Bell Canada, Telus, Qwest, Sprint, Sasktel, Telebec, Telephone de Nantes, Telephone de Warwick, US West Express, GTE, Nevada Bell and Embarq. They were biggest player in the payphone market.

In 2009, Nortel went out of business.

What happened? The answer is obvious. Cell phones happened, and Nortel could not adapt.

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The adjustment between organisms and their environment is referred to as evolutionary adaptation. Adaptation is the root concept that grew into Darwin's theory of natural selection. Organisms that cannot adapt become extinct.

Given the rapid and dynamic changes occurring in the dental industry, both in the clinical, organizational and reimbursement domains, it is evident that solo practices cannot adapt rapidly enough to address these changes, while managed group practices have a much greater adaptation capacity. This inability to adapt quickly enough will cause the contraction and eventual demise of solo practice.

Solo practice is based on a historical model of small business organizational structures and processes. These structures and processes may be executed better or worse in respective solo practices, but they are basically the same in each one. Yes, there have been drastic improvements via IT and technology in their structures and processes; yes, there are much greater efficiencies; yes, data analytics has enabled better management and control-but basically, solo practice is still solo practice, whether high- or low-tech, poorly or very well run.

Related article: Why managed group practice will dominate the future

Given the rising costs and complexity of operating a dental practice, the economics of solo practice dictate the dentist must be the producer, the leader, the manager, the team leader, the VP of marketing, the VP of facility management, the principal in R&D, the owner and a team player. In solo practice, the dentist must act as the CEO, the COO, the CFO and the VP of every department.

Up next: What a group practice could do for you 

 

Staff costs are the albatross of the budget in solo practice, which usually results in the front desks being overworked, with many incoming calls not answered. Studies have shown that up to 60 percent of calls are not answered in solo practice. The same level of overwhelming work is often present for assistants and hygienists in solo practice. In solo practice, salaries are basically stagnant, benefit packages are minimal, compensation increases are only given on demand or by threat, and turnover is massive. The dentist in solo practice rarely has time for leadership or management to focus on external changes in addition to the mandatory internal clinical, financial and administrative processes. This is not the case in managed group practices.

Related article: How managed group practice can turn you into a digital entrepeneur 

In managed group practices, there are different divisions to handle specific functions so they are much more efficient and highly more effective. For example, a well-run call center captures nearly 90 percent of the calls, their scheduling rates are far higher and patient satisfaction is far greater. Nearly every operational function in a well-managed group practice is more competently delivered, and cost-per-patient is far less.

As massive external changes occur in the dentistry and new mandates are overlaid on the practice of dentistry, the ability to focus attention and intentions on adapting to these changes is nearly impossible for solo practice.

The changes are varied: the mandated inclusion of electronic patient records bringing systemic issues and risk management to the forefront, quality assurance programs based on value and outcomes, artificial intelligence bringing diagnostic pathways and evidence based treatment plans, dentists’ ratings by consumers, dentists rating by outcomes, third parties creating an integrated system by acquiring dental practices; these are just the tip of the iceberg of changes about to occur in dentistry. The emerging changes are massive and disruptive.

Related article: Will this insurance move put an end to solo practices?

How can solo practices adapt to these changes in their procedures and processes? The simple answer is that they can’t. The changes emerging in the future will further propel the growth of managed group practices and cause enormous fiscal and operational stress on solo practices. Where group practice is the future, solo practices are quickly becoming the payphones of dentistry.