By Bill Adams, DDS, FAGD
One year ago, dentists around the country didn’t know when they would be able to practice again. The COVID-19 pandemic almost instantaneously shuttered dental practices, as well as nearly every other service we take for granted. For several weeks in some areas and several months in others, dental practices were offline. Cleanings were pushed off. Surgeries were pushed back. A path forward was not entirely clear.
Fast forward one year, and we’re still living with the COVID-19 pandemic, but dental practices have forged ahead in our new normal. Patients have returned, often in greater numbers due to pent-up demand. Patients still want their teeth cleaned. They want white smiles as they go back out in public and see their friends and family. Those in pain still need help.
Interest in dental practice transitions has also bloomed. Even as the country endured COVID-19 and waited for states to recount their ballots, dentists’ web traffic more than tripled. Dentists who paused 12 to 18 months ago with their practice transitioning plans are now calling us to schedule meetings to discuss their options.
Based on our conversations with dentists, there are a few key reasons why dentists are looking to make this change now instead of a few years down the road.
Risk and liability
Dentists want to reduce risk and liability for themselves, their family, and their staff. They want to make sure that if something happens to them, their family and staff will be taken care of. Many of these dentists are not ready to put down their instruments, but they want to have a plan in place in case they must. If anything, 2020 made a lot of people realize how much is on their shoulders. What if someone gets sick? These dentists want to offload risk to a buyer so they can focus on their jobs and then go home without worrying about what might happen to the practice.
We work with a lot of older dentists who love what they do and are worried about completely retiring. Dentistry has been their whole life. They want to keep practicing but not actually run the practice.
We’re seeing more diversity in sellers as more women enter the industry. We’re hearing from more clients who started their own practices but then, after a few years, realized they needed someone to manage the practice so they could spend more time with their families.
Taxes and interest rates
Although we can’t predict the future, we’ve all heard the rumors of possible tax changes. If Congress changes the tax codes, especially the capital gains tax rates, how will this impact the money you owe in taxes? In other words, how much money will be left in your pocket?
This has been a hot topic with mixed messages. We don’t have a crystal ball, but based on what we’ve seen, we know there will be a disruption at some point. The same goes for interest rates, which remain low now but are expected to steadily rise to combat inflation. With money still cheap to borrow, many buyers are doing just that.
Lingering effects of COVID-19
COVID changed the world and impacted all of us. Many dentists had to furlough employees, file for Paycheck Protection Program (PPP) loans, order additional personal protective equipment (PPE), put COVID messages on their websites, and make internal changes to their practices.
General practices were affected more than specialty clinics as most were closed from four to 12 weeks. The good news? While hygiene recall services were disrupted, many of those services have been rescheduled. Likewise, buyers looking to acquire dental practices put their efforts on hold for much of 2020 to see if numbers would come back.
There is more good news: what we started seeing in the late summer and early fall was that many practices were doing as strongly as they were before the pandemic, if not a bit better due to the COVID-induced backlog.
What’s next?
If you’re thinking about transitioning your practice, or if you’re looking for a practice to acquire, it’s important to work with a transition team that can take you through the process from start to finish. The process should begin with a conversation about your vision and needs.
Regardless, COVID-19 has shown our industry how robust it really is. It’s hard to believe we’ve been living with this new normal for a year now, but all signs point to the dental industry being stronger than ever, and ready for anything that may try to disrupt it.
Bill Adams, DDS, FAGD, the founder of US Dental Transitions, practiced general dentistry for 25 years after graduating from Emory in 1969. He founded the company in 1998 to help his fellow dentists transition their practices to other dentists who share similar values and philosophies. During the last 20 years, Dr. Adams has consulted with more than 6,000 dentists and transitioned more than 500 practices. He is Pankey/Dawson trained, a Fellow in the Academy of General Dentistry (FAGD), and a lifetime member in the Hinman Dental Society.
