The ABCs of getting started in practice

January 13, 2020
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The ABCs of getting started in practice

It’s frustrating to work for someone else, isn’t it? If you’ve been an associate for a couple of years, you’re probably chomping at the bit to get started in your own practice.

In order to move forward with your own practice, you first need to make some personal decisions. What type of work-life balance do you need to thrive? Will owning a dental practice help you foster the lifestyle that you and your family members appreciate most? What is appealing about practice ownership and what is not? Do the positives outweigh the negatives for you?

Once you’ve determined what type of commitment you’re willing to make to your professional career, you need to make decisions about the type of practice you want to call your own. Where do you want to locate? What size practice can you sustain while maintaining the work-life balance you desire? What type of dentistry do you want to perform? Are you willing to work with insurance companies? Do you envision yourself as a solo practitioner, or are you more inclined to join or create a group practice? And finally, are you interested in an established practice? Or do you want to build your practice from scratch and create a start-up? Here’s some info to help you begin to process these decisions.

A solo practice is one in which there is one dentist producer who assumes all responsibility for the practice. In a group practice, there is more than one dentist producing dentistry and responsibilities are shared. If you think a group practice suits your personality, make sure that you start off with a buy-out plan in force, ensuring that if one partner wants to opt out of the practice, you have a plan established that’s agreeable to all parties. Unfortunately, many people wait until one member of the group is ready to leave, and then it’s difficult for all parties to consent to fair terms that will benefit everyone.

When you create a start-up, you can set everything up exactly as you desire. Savvy banks will lend money based on your anticipated production, so you can purchase new equipment and install the latest technology. Like every construction project, though, the build-out of the office may take longer than anticipated, so don’t quit your day job just yet! In the meantime, you need to learn about and comply with government regulations, become credentialed with insurance companies, start marketing your services and begin hiring staff. (Have we mentioned that DOCCUPATIONS will make your search for employees efficient and effective?)

Alternatively, the purchase of an established practice usually has the advantage of including a patient base, staff, established protocols and the physical space (depending on the terms of the agreement and the lease.) However, there is no guarantee that the patients or staff will stay or that the established protocols are effective. There is also the possibility that the dentistry performed by the original owner may need to be redone, in which case you may wind up sharing or absorbing the loss.

If you’re interested in an existing practice, there are several ways to proceed. You can buy in as an associate, buy in as a partner, or simply purchase an existing practice. We will explain the differences and the pros and cons of each.

If you buy in as an associate, you will start as an associate in the practice with an option of ultimately assuming partial or complete ownership. An obvious advantage to buying in as an associate is that before you assume responsibility for the practice, you have an opportunity for to be mentored by and learn from the owner. By the time you’re ready to buy in, you will know the patients and staff, and you will be comfortable with (and may have contributed to) the practice philosophy. Best of all, you can reassess your decision before committing to purchase. If you decide the practice/partner/staff/patient base/location isn’t right for you, you’re not obliged to proceed.

It can be difficult to assume a leadership position in a practice where you begin as an associate. The staff is not accustomed to taking direction from you, and you may encounter some initial resistance when they realize that they now report to you.  If making a shift from associate to partner in the same practice concerns you, consider finding a practice where you can buy in as a partner. In this situation, you’ll commit to a purchase from the onset, but as a result, you’ll forfeit the ability to base your decision on your ongoing assessment of the viability of the practice and your interest in it.

For a partnership agreement, make sure that your agreement includes equity with your partner at the time of buy-in rather than building equity as you go. Also, there will most likely be a production discrepancy between you and your senior partner in that you’re likely to produce more, so make sure that both partners are compensated based on their production, rather than agreeing to a 50-50 split.

If you have no interest in a partnership, you can purchase an existing practice with no partnership agreement. The owner may stay on as an employee or an independent contractor for a while to introduce you to the patients, but you are the sole owner of the practice.

Lots to think about. In the meantime, use your associate positions to learn as much as you can about the business of dentistry so that once you have enough practice management knowledge and your level of skill and confidence are high, you’ll be ready to make the decisions that will lead to your ultimate and optimal personal and professional satisfaction.

Authors’ note:

For additional blogs that might help with some of these difficult decisions, please refer to:

Defining a vision
Using demographics to forecast your future
How do I decide where to practice?
What type of practice is best for me?