Author: omniadmin

I remember when I bought my first house.  I wasn’t sure if the timing was right, whether the house the real estate agent recommended I buy was the right house or if I could afford the house payments.  At the ripe age of 26, I took the plunge and bought the house.  It turned out that years later, those trepidations I had were irrelevant.  This wasn’t the perfect house, but I remodeled it and made it near perfect to me at that time.  The value grew and I built equity.  I made adjustments to afford the payments and the timing really didn’t matter. 

The same goes for buying a practice.  The practice you buy does not have to be perfect and the last practice you buy.   You buy a practice that fits your needs at your current time in your life.  You put sweat equity and hard work into the practice to make it profitable.  You do a bit of remodeling to make it fit your personality and style.  You work in the practice building equity and you hone your skills as a practice owner and a business manager.  In the end, timing is not as important as you think.  I know many doctors who bought their first practice when interest rates were 15%.  Also, keep in mind that practice owners earn 20% more than associates who are employees.  (Read Rich Dad, Poor Dad if you want to understand why you should own and not be an employee).

The moral of the story is if you feel you might be ready but are not quite sure, you’re ready.  Interest rates continue to be low.  The economy is doing well.  There are great resources that can help you own and run a practice.  If you would like to discuss whether or not you are ready to own, feel free to reach out to any of us at Omni to discuss your individual situation. Send us an email or give us a call at 877-866-6053 today!

As we approach the end of the year, you should contact your patients and let them know that they should look at their insurance to see if they have available funds to complete procedures, or fit another cleaning in before the end of the year.  There are standard patient letters that many consultants use to send out to patients.  Or, you can use one of the internet based patient notification systems to let your patients know to use their insurance.  We also have a letter template for insurance notification.  Send us an email ​and we’ll send you a copy of the letter. ​

There are a number of reasons that doctors sell their practices.  Some are good reasons, like when you have reached a point where you have enough money to live comfortably the rest of your life while you are still healthy.  Other situations may not be good.  Those can include failed health, a practice that is quickly losing production, or the worst-case scenario — you suddenly pass away.

If you are still in good health but are not sure if you are in a good financial position to be able to live comfortably the rest of your life without working, we recommend you speak with your financial planner.  They can analyze your situation and see how much more you may need to work.  Or, if you can sell your practice, put the money into a retirement account and work at a practice and continue to make an income while harvesting the equity you have in your practice.  This is one of our favorite transition strategies.  It’s like selling your house, but you get to continue to live in it.  Just because you sell your practice does not mean you need to stop working or retire.   You can still work clinically if you still enjoy dentistry but don’t enjoy the management or dealing with insurance companies continuing to lower reimbursements.

Another time to consider selling is when your practice is continuing to go down in collections or net income.  We have numerous examples of when a doctor could have sold two or three years prior and made another $200,000, $300,000, or even $400,000 more if they would have sold at the height of their practice production.  Instead, they watch the production numbers and patients go down year after year after year.  Even though the owners knew they were getting tired, referring more work out, or simply seeing fewer patients, they continued to hold onto their practice thinking they can sell it based on what the numbers were at the height of production. 

The worst time to sell is when you have to sell, say when you or a family member have failed health, or you suddenly pass away.  In this scenario, you or your family are left trying to quickly get the practice sold before all of the patients leave and there’s a skeleton of a practice left to sell.  That can be a devastating situation, especially when the funds from the sale of the practice were counted on as a source of future retirement income.  At a minimum, you should keep an emergency contact list for your family in your office that includes your attorney, accountant, practice broker, supply company, etc., that can alleviate some of the burdens on your family.

Whether you are 20 years from retirement or 2 years from retirement, you should be always be prepared and have an exit plan.  We are always available at no charge for either a phone call or a meeting over a cup of coffee to help you put together that plan.

The American Animal Hospital Association cordially invites you to attend this valuable seminar about planning your future.
RSVP​ by Sept 29 – email dg.seminar@bac.com or call 614-753-1603.

In the September 2017 subscription of JADA, there is an article titled “Practice Ownership is Declining” by Marko Vujicic, Ph.D.  As the title reveals, the article is about the decline in practice ownership by dentists.  If you have not read the article, I highly recommend it.  The statistics in the article support what we are seeing in the market for dental practice and some of the articles I’ve written recently.  If you do not subscribe to JADA, here are a few of the highlights.

There is a steady decline of practice ownership, especially amongst male dentists.  Approximately 80% of dentists currently own practices.  Rising student debt, the emergence of corporate dentistry, shifting work-life balance preferences were just a few examples of why there is a decline in ownership.  One of the big questions brought up is whether the trend is a big deal.  It was pointed out that practice ownership is highly coveted and one of the reasons that dentists got into dentistry in the first place.  All else being equal, owner dentists earn more than non-owner dentists.  The question is, is practice ownership no longer as coveted as it used to be by younger, early career doctors?

The decline in practice ownership will continue for years to come.  A comparison to the decline in ownership by physicians, which is now below 50%, was used as a comparison.  Hospitals and groups have taken over the ownership of physician practices.  The study states that physicians’ net hourly income is significantly higher than for dentists; Although, I would say that the annual income is higher for dentists, all things being equal.   The author also claims that physicians are happier as a result of not being an owner of a practice.  With reimbursements continuing to decline, dentists will be asked to do more with less.  An emerging emphasis on quality and value will spur changes in dentistry. 

If you have not read the article, I recommend you take a look.  Email me at rod@omni-pg.com and I will send you a copy. You can also go to jada.ada.org and search for “Practice Ownership Is Declining.”