Private Equity Didn't Kill Dentistry Complacency Did

I keep hearing the same story: private equity is destroying dentistry.

Independent dentists are selling out. Corporate chains are taking over. The soul of the profession is dying.

Here's what nobody wants to admit: private equity didn't create this problem. They just showed up to capitalize on practices that were already operationally obsolete.

When I ask dentists what responsibility they're avoiding by blaming PE firms, the answers are uncomfortable. There's a lack of accountability around capital investments in technology and equipment. They increase headcount to address ineffectiveness instead of having difficult conversations with team members. They listen to the wrong people in their business without understanding what the actual problem is.

And then there's the reimbursement issue—where most dentists have simply put their head in the sand.

Here's how the pattern plays out in real time.

The office manager complains they can't verify insurance eligibility fast enough, can't load insurance fees into the practice management system fast enough, can't follow up on claims being sent out each day. The solution? Hire an "insurance coordinator."

The dentist increases overhead by $50k because they don't fully understand the issue. The actual solution could have been a service that completes these tasks at a fraction of the cost.

This happens because dentists often don't look for administrative solutions. Or they don't understand the concept of operational efficiency. Usually it's both.

They're brilliant clinicians who never learned to run a business. And that gap is now costing them everything.

Most dentists have no idea they can request fee increases from payers every six months.

The dental insurance industry is challenging to negotiate with—I'll give you that. It takes diligence and follow-up to break through and get insurers to increase reimbursements. They won't increase all your fees, but they'll do three or five every six to twelve months.

Here's the killer: private practices typically don't update their office UCR fees, which drags down their opportunity to increase reimbursements from insurance providers. That's what insurers use to base their increases on.

If you don't increase your practice's usual and customary fees and then try to negotiate with insurance providers, they'll give you the lower increase compared to other practices—especially DSOs—in your market.

The data backs this up. Research shows that a 10% increase in dental insurance concentration is associated with a 1.95% reduction in gross payments to dentists, while a 10% increase in dentist concentration yields only a 0.71% increase in payments. Solo practitioners are getting crushed at the negotiating table because they have no leverage.

DSOs negotiate every six months and update their fee schedules regularly. Independent dentists sit still.

I've seen dentists not update their fees in 12 or 15 years. They're exhausted by the time they sell because of the sheer volume of patients they have to see just to maintain revenue and profit growth.

This is why private equity and DSOs are growing in the dental space. There's a deep understanding of efficiency and effectiveness that dentists, by nature, don't understand and have never been taught.

Picture this: a dentist who hasn't raised fees in 15 years, grinding through volume just to stay afloat, finally sells out of pure exhaustion.

When private equity shows up with an offer, they're not really disrupting that practice. They're putting it out of its misery.

The dentist sees it as relief. Their teams think private equity is the devil. But here's the gap: dentists don't fully understand what they're signing up for.

PE firms communicate that dentists will continue to enjoy clinical autonomy while the DSO takes over operations. They sign the contract and cash the check, not realizing what "taking over operations" actually means.

The same issue of not fully understanding their business carries over into the PE experience. They didn't realize there's going to be a lot of change.

The numbers tell the story. The U.S. dental service organization market is projected to explode from $37.9 billion in 2024 to $196.5 billion by 2034—a staggering 17.9% compound annual growth rate. DSO affiliation among dentists jumped from 8.8% in 2017 to 13% in 2022, with the rate much higher for dentists less than 10 years out of dental school.

This isn't disruption. It's consolidation of practices that were already failing to compete.

The first operational change that typically blindsides dentists after a deal closes? Fee increases and PPO negotiations.

They've always based their fees on feelings and emotions. PE completes an analysis and makes decisions based on data.

What does emotional pricing look like? Patients complain, and dentists don't like confrontation. So rather than increasing fees and dealing with patients responsibly, they keep them the same for years.

Or worse: they think a crown fee "feels high" at a certain number, having no knowledge of what the local market is actually pricing.

The second shock is technology. New practice management systems. AI receptionists. AI radiology analysis software. All in an effort to reduce headcount and cost.

That's a tough pill to swallow when you have to let team members go who have been with the practice for many years.

But here's the thing: the technology existed the whole time. The solutions were available. Dentists just chose not to adopt them.

Research shows 77% of patients value booking appointments online anytime. Only 26% of dental offices offer it.

That's a massive gap between expectation and delivery.

Even more damning: 60% of patients say they would choose a new provider for a better digital experience. 41% have left or considered leaving a dental provider because of poor digital tools. Up to 95% of people say they would book a dental appointment online if they could.

The demand was screaming. The technology existed. Practices just didn't listen.

I don't think dentists haven't invested in improving patient experiences. I think they lack the grit to ensure they and their team actually put into practice what they've learned.

I've worked with hundreds of dentists who have paid for very expensive patient experience or case acceptance workshops and continuing education. The issue isn't investment, it's leadership and the ability to hold your team accountable.

Dentists work in the back office. Case acceptance and patient experience are a whole practice commitment. You could be the best clinical practitioner and still be poor because you can't sell the service.

Here's the pattern: dentists drop $15k on a case acceptance workshop. Everyone gets fired up for two weeks. Then it's back to old habits because nobody's holding anyone accountable.

Actual accountability doesn't have to be complicated.

You set up a few people who own different parts or sections of the program. You establish targets and benchmarks. It gets discussed daily during the morning huddle. The section owner observes the target behaviors in the back office, front office, and marketing. You track progress against benchmarks. Progress is celebrated.

You see the change within 30 to 45 days. Rinse and repeat if more evolution is needed.

This isn't rocket science. But it requires something most practices don't have: operational discipline.

Tech companies and retail health providers are coming. And they have operational discipline built into their DNA from day one.

Startups are building the plane while flying it. They're agile. They recognize failure early and consider it a win because the faster you fail, the sooner you arrive at your intended target.

They're also transparent. They don't tell dentists nothing is going to change when they're taking an antiquated business and transforming it into an efficient, effective, and profitable operation.

Practices using modern cloud-based systems are increasing new patient appointments by up to 25%, many booked overnight or on weekends when no one answers the phone. Digital workflows enable this. The technology isn't experimental. It's proven.

Some practices get it. Most don't. That performance gap isn't about private equity, it's about operators who refuse to compete in the market that actually exists.

When I work with a dentist who's finally ready to modernize before they hit the exhaustion point, there's a hard truth I have to tell them: they've been overpaying for supplies and people costs for years.

I get it. You've been running a business for decades, and someone comes in and tells you your business processes are outdated and you've been paying for more people than you need. That's highly inefficient, and it's uncomfortable to hear.

I try to highlight what they've done well. I lean into the partnership aspect. The changes will equate to a net positive outcome once implemented. The goal is to make them feel we're going through it together and they have a trusted advocate and partner.

But the truth remains: the inefficiency was always there. Private equity didn't create it. They just knew how to fix it.

I've seen hundreds of practices, both the ones that waited too long and the ones that adapted in time.

A thriving independent practice that successfully modernized looks different the moment you walk in the door.

The team is celebrated. There's a focus on supporting employee growth. The "leaders eat last" approach is real, not just a poster on the wall.

There's a focus on patient experience and on using technology effectively. It's not about having shiny new toys, it's about having the latest tools and resources to address patients' needs in an effective and efficient way.

These practices exist. They're competing successfully against DSOs. They're profitable. Their teams are engaged. Their patients are loyal.

The difference? They chose to adapt before they were forced to sell.

Private equity didn't ruin dentistry. They just showed up to an industry that had already stopped competing.

Dentists ignored technology adoption while medicine raced ahead. They avoided difficult conversations about efficiency. They set fees based on feelings instead of data. They refused to negotiate with payers. They hired more people instead of better systems.

And when consolidation came, they blamed everyone but themselves.

The dental industry's challenges aren't unique. Every traditional industry faces the same choice: adapt proactively or get disrupted reactively.

The practices that survive the next decade won't be the ones with the best clinical skills. They'll be the ones that finally learned to run their practice like a business.

Because here's the thing: the next wave of competition won't give you 15 years to figure it out.

They'll just build a better experience from day one and take your patients while you're still debating whether to offer online booking.