Dentists who are contractually involved with insurance today are fully aware of the shift toward PPO style plans, which restrict patient access to dentists of choice, as well as restrict dentists under contract from referring to specialists of choice.
In and of themselves, these restrictions would be manageable if it were not for the substantial reductions in fee code compensation, where in some cases, that compensation drops from payments in the range of 82% of “reasonable and customary” rates down to 58%.
One does not need an MBA or a degree in accounting to see that a broadly experienced additional compensation drop of 24% devastates profitability, which then forces upon the practice changes in business structure and climate to survive.
This external force – the shift from indemnity plans to PPO plans- is affecting the dental profession more than any other trend, as it demands a ramped-up economy-of-scale approach to dental practice. In other words, it is forcing the dental profession to become industrialized, where patients become “units” and workers become day laborers.
With all of the focus on maximizing productivity and reducing costs, while maximizing profitability, the discussion of health is easily lost, and the dentist and teams are reduced to being repair workers laboring under a remedial philosophy, and with patients who are often dissatisfied with both the outcome and their experience.
This trend line was noticed early by Bob Barkley in 1972 when he said, “Dental service corporations play a very critical role nationwide since they can stymie progress in prevention…Somehow service corporations acquire a marked distrust for the honesty of dentists and use this as a reason for holding back on their preventive teaching programs. One prominent dentist-executive of a large corporation declared that to pay for such teaching would be an open invitation to fraud.”
So there we have it- the core of the problem, the fact that dental insurance has everything to do with money and is only peripherally associated with health. And that the contractual relationship between the dentist and service corporation is founded on distrust. Consequently, a more dysfunctional relationship could not be designed or advanced.
Paul A Henny, DDS
Thought Experiments LLC, ©2017
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