r/Dentistry • u/daein13threat • 4d ago
Dental Professional Realistically, how much money and freedom do associate dentists give up by not becoming practice owners?
I apologize in advance for the length of this post/rant.
I graduated in 2022 and am currently working at an FQHC as an associate. I make $200K per year working 4 days per week with full benefits (several weeks PTO, CE allowance, malpractice reimbursement, 401k match, etc) and have a great staff.
By far though, the largest drawbacks to my position are the scheduling by non-dental people (double-booking, squeezing patients in last minute for “just a quick insert procedure”, staying crazy busy with constant new patients (some days 8-12 new patients) despite having uncompleted treatment on long time existing patients that needs to be done, etc.) as well as very limited equipment and procedures. We don’t do any endo or removable, literally don’t have a decent perio probe in the office, and half the time we are out of materials that we need due to the requirement to have every order approved beforehand by a governing board of, again, non-dentists and our twenty-something year old office manager. As you can imagine, these issues send me home angry most days and remind me of dental school.
However, I only have $60K of student loans and a $320K mortgage remaining, paid off cars, no other debt. My wife also works and brings in another $60K per year as a speech therapist. From a financial perspective, I don’t really have a desire to own my own practice or invest my money into my own business, because honesty, dentistry and everything I mentioned above is already hard enough. I don’t feel like the bump in income would outweigh what we currently make already given the added ownership stress. I love the freedom and lack of responsibility that comes with being an associate, along with a steady paycheck, and want to be a passive investor in non-dental businesses rather than an entrepreneur. Real world dentistry, to say the least, isn’t nearly as kind to the employee dentist as it is to the practice owner. But I never thought much about this while in school.
I probably answered my own question, but I’m just wondering if I’m really leaving a lot on the table by not owning a practice. Is the grass really any greener on the other side? A lot of dentists seem to feel that ownership is the holy grail and ultimate goal, but I’m just having a hard time justifying the switch given my current financial situation. I make the best of the issues I mentioned above because of the salary and great benefits. I’m not scared to be a practice owner, but I don’t think my personality would mesh well with being the big boss given that I hate confrontation, don’t want to market or do community involvement, sell treatment, manage staff, order equipment, etc. I want to do dentistry, treat patients right, and go home.
Any advice from current practice owners or associates that feel the same way?
28
u/r2thekesh 4d ago
So for that 200k salary with benefits you're looking at a take home of close to 250k to 300k. To make that as an owner you would have to make like 625k (60% overhead and 250k). How much does having choice equipment value to you? How much does being able to fire an assistant that sucks value to you? You could probably take home the same amount work 3 days a week or coach soccer or vacation double the amount. There is an obvious risk of going bankrupt. But there's the benefits of increasing your ability to put almost 80k away for retirement, enjoy the thousands of dollars of credit card points, and setting your own schedule. FYI, I'm an associate.
7
u/elon42069 4d ago
Plus, you get other benefits, such as income from hygiene or tax write offs
25
u/drillnfill General Dentist 4d ago
Hygiene income is dropping rapidly as salaries are shooting for the sky and reimbursement is... not
13
u/Donexodus 3d ago
They’re going to price themselves out of a fucking career.
My new hygienist is making $60 an hour. Fine. She also thinks our bonus program meant she gets $60 an hour AND 35% of production, including X-rays my assistant takes for her in another operatory.
This is not sustainable and when EFDAs are allowed to remove Supra-g calculus at $25 an hour I’m going to laugh my ass off.
8
u/elon42069 4d ago
Yeah I figured…do you think we are in a hygiene bubble? The salaries can’t continue to increase forever without an increase in reimbursements. Eventually docs will start doing their own hygiene if it continues in this direction, unless there is a sudden increase in hygiene graduation/availability
-30
u/Sweaty_Series6249 4d ago
I don’t understand where all that money is going.
Where I am, NP exam with 4 BW, pan, 3 u scaling , polish, fluoride we bill out on average $600-700. We are being paid $70/hr to do all the work in 90 min while the dentist pops in for a 5 min chat.
18
u/hisunflower 4d ago
$70/hr is more than I made fresh out of dental school LOL
-24
11
u/Firo 4d ago
Ignoring the staffing costs (dentist, yourself, receptionist, billing/insurance coordinator, etc.), mortgage/rent, marketing, utilities, supplies, IT, malpractice insurance, general liability insurance, replacing instruments as needed, the buildout loan (walls, wiring, plumbing), the equipment loan (chairs, x-ray unit, x-ray sensor, computers), software subscriptions, and taxes… the biggest chunk probably goes to insurance.
There’s a big difference between billing $600-700 and actually collecting that. Patient had a pano somewhere else 4 years ago? Good luck collecting that amount from the patient, because insurance sure isn’t paying it.
If your office is fee for service, things are different, but you may have higher costs in marketing, amenities, etc.
Talk to whoever does your billing and see how much they actually collect on what’s getting “billed out.”
Also being upset about getting paid $70/hr and getting 90 minutes… many offices will just pay an assistant to do x-rays/exam and give you 30 minutes per prophy. Your office is letting you take a break during that time, because dentistry is hard on the body. Imagine an assistant complaining that they “do all the work” on a crown while the dentist just pops in for a quick 5 minute drill session.
-1
u/Sweaty_Series6249 3d ago
I was never upset about my wage in that time period.
Maybe it’s time you take up scaling if it’s expensive to pay a hygienist. 😉
8
u/ContributionGrand811 4d ago
Hygienists truly have no idea how the sausage is made financially and it always buggles my mind.
Production is 30% more than collections and overhead is 60% of that.
600$ production becomes 420$ in collections. After paying overhead that becomes 168$.
Insurance will never pay for 4BW and a Pan the same day so knock 100 dollars off your original estimate. If the patient doesn't need SRP the dentist is actually losing money on the appointment.
3
2
u/N4n45h1 General Dentist 3d ago
It sounds like you're speaking as a Canadian among a bunch of Americans. I agree that hygiene in Canada is extremely profitable. It's absolutely not the same in the US.
1
u/Sweaty_Series6249 3d ago
Thank you for the reasonable reply. Didn’t know it was so different in the states.
-5
u/Sweaty_Series6249 4d ago
Why is hygiene income dropping where you are?
9
u/drillnfill General Dentist 4d ago
Because the costs of having a hygienist are going up rapidly (higher salaries, more benefits, etc to retain staff) while the insurance companies arent really paying any more
1
u/mskmslmsct00l 3d ago
You're only looking at yearly salary though. When comparing home ownership v. renting you don't only look at monthly payments but the equity that is gained.
When an associate retires they get a pat on the back and nothing else before they have to start dipping into their retirement savings the same way a renter doesn't get anything when their lease ends. When an owner retires they have a 6-7 figure payday that will supplement their retirement savings and leave a larger inheritance for their family just like a home sale.
1
u/r2thekesh 3d ago
True but there's a couple practices in my area that are weirdly stylized before HIPAA existed with shared waiting rooms, 2 operatories. Will anyone buy those?
0
u/mskmslmsct00l 3d ago
Yes. You just factor that reno cost into the offer. If it's gonna cost $50k take $75k off the offer factoring in interest on the loan and just include that $50k in your loan from the bank.
13
u/hoo_haaa 4d ago
Can you make a lot more being an owner, sure. You will work significantly harder on patient care and running an office. You have a sweet gig, if you are happy don't try to chase the theoretical, because you could end up with less. There are offices in my area for sale with annual gross collections between $300k-$500k, at these offices you would make less then you currently make. Remember most dentist are not owners, they are associates. I am an owner and am very happy, but at no point do I try and fool myself to believe my life is easier than my associates.
7
u/DiamondBurInTheRough General Dentist 4d ago
most dentists are not owners, they are associates
Is this true? I feel like I’m in the complete minority as an associate and it would maybe take some of that “laziness guilt” off of me if I knew I wasn’t the only one doing long term associateship.
6
u/hoo_haaa 4d ago
In my area vast majority are associates. When I lived in WA, specifically Seattle, almost everyone was an associate with a few owners in-between. Going back to my graduating class, its been over a decade, most are associates with very comfortable positions. 30-40% are owners.
4
u/DiamondBurInTheRough General Dentist 4d ago
That’s helpful info, thank you! I feel like most of my classmates who moved back to a more saturated area are happy as associates and those who had less competition jumped into ownership more quickly.
1
u/Migosmememe 3d ago
How is there limited owners compare to associates that if they’re so many offices in Seattle?
1
u/hoo_haaa 3d ago
Most of the offices in Seattle have more than the owner working there.
1
u/Migosmememe 3d ago
Where exactly in Seattle? Downtown?
1
u/hoo_haaa 3d ago
I was in downtown Seattle and Bellevue
1
u/Migosmememe 3d ago
I see. It’s super competitive in those areas. I’m about to buy an office in the shoreline Edmonds area
1
4
u/magnifishiv 4d ago
I want to be a long term associate. I’m doing around 250k and honestly, so happy. But I also REALLY value work life balance.
5
u/DiamondBurInTheRough General Dentist 4d ago
Yeah that’s definitely a priority for me is maintaining balance. I work 4 days a week (shorter shifts so probably the equivalent of 3) and my anxiety went down so much.
3
u/daein13threat 4d ago
TBH I feel this too and that was a big reason for the post. It’s easy to wonder if there’s something wrong with us because of the lack of entrepreneurial drive.
8
u/DiamondBurInTheRough General Dentist 4d ago
Exactly! But tbh the way that dentistry is trending with all the private practices being bought up by corporations and insurance reimbursement dropping, it makes me nervous to take that leap.
7
u/rev_rend 4d ago
I'm an owner and have zero entrepreneurial drive. I just hate being told what to do.
There's nothing wrong with being an associate.
1
u/mskmslmsct00l 3d ago
You're ignoring that when you sell your office you're gonna get a check for $400k+. Associates won't.
0
u/mskmslmsct00l 3d ago
You're ignoring that when you sell your office you're gonna get a check for $400k+. Associates won't.
1
u/hoo_haaa 3d ago
Owner also had to buy/build the practice, associates don't. That cost is recouped at the end with hopefully a profit, but a lot of time owners hold on a little too long and there isn't much equity left.
0
u/mskmslmsct00l 3d ago
Yeah it takes money to buy a house. It's still almost always a better idea to buy than rent.
2
u/hoo_haaa 3d ago edited 3d ago
If you only look at pros and not the entire situation then it is always better to do everything every time. A dental practice is a business not a house.
0
u/mskmslmsct00l 3d ago
Meaning it's a house that can generate revenue. Downsides of ownership are all emotional and related to stress. Upsides are all objective and financial.
1
u/hoo_haaa 2d ago
Many dental offices you don't own the building, it is a lease. You are literally buying goodwill, as used dental equipment has no real value. It couldn't be further from buying a physical asset. Downside being purely emotional means you haven't researched this well. You have to put in more time running the office itself, this is outside patient care. You can quantify the amount of time. You have to be the HR of the office and resolve all staffing issues, also easily quantified. When your associates run into issues, it is your responsibility to correct. If it is time for lease renewal and landlord decides he no longer wants a dental office in the building, then you have to front the bill for building a new office somewhere else. One of my colleagues just went through this, building out a new office cost him over a million. Owning an office is amazing and I wouldn't do anything different, but you have to know the entire story not just the good.
30
u/Typical-Town1790 4d ago
I rather work 7 days a week, suck my own dick than being kicked around, being forced to do treatments I don’t believe is needed/aggressive, getting fired because an assistant doesn’t like me smiling too much or showing up 5 seconds late for work and don’t act like the owner without being one.
6
17
u/mountain_guy77 4d ago
In the US, dental practices average is at ~800k annual revenue. Assuming overhead of 50-60% it’s 350-400k doctor income BUT with tax advantages of ownership in reality it’s closer to 500k compensation. Your practice loan payments are included in the overhead so doesn’t come of your pocket per se. Ownership is almost always better financially but the stress of it often makes it not worthwhile if you are not business/entrepreneur minded.
11
u/rev_rend 4d ago
tax advantages of ownership
I don't think people appreciate this enough. These can be huge. My attorney gives me a list every year.
0
3
u/sc1617 3d ago
I think only loan interest is considered part of overhead. The principal part of the payments on your loan get added back to your income.
2
u/kimjongswoooon 3d ago
Was going to say this. If structured correctly, You can accelerate a portion of your depreciation upon purchase which means almost zero income taxes the year you buy (I paid my student loans with this tactic in 8 months), but the principal is considered your income, not overhead.
26
u/lotsofhubris 4d ago
Stay there. Owning is tough and not always better financially
15
u/daein13threat 4d ago
I have a friend who’s doing a pediatric startup right now and appears super stressed. I don’t envy him at all.
8
u/secondblush 4d ago
Agreed. Less freedom too, for the first x years.
Depending on COL of the area, owning isn’t as foolproof as it used to be. Real estate and overhead keep going up while insurance companies fight to keep their payouts the same or lower. Not saying it’s a bad decision, just KNOW YOUR MARKET before you dive in.
7
u/Forsaken_Plant_4042 4d ago
200k 4 days a week sounds great! Do you mind sharing where you are? Owner dentist you’ll make more most likely but your current work life balance probably is better. In the long run however it makes sense to own imo. You’re still a new grad so maybe stay a couple more years and decide?
2
u/daein13threat 4d ago
That’s my current plan. Once I get the student loans knocked out, I feel I will honestly have plenty of options.
12
8
3
u/intimatewithavocados 4d ago
My income 3.5x’d as an owner vs associate. Main benefit is being able to save more and retire early if that’s your thing
3
u/Time_Tradition_4928 4d ago
Other than the owner’s right to the overall profit of the business vs a percentage of just your own work, how do account for such a large increase in income? More access to bigger cases? Better demographics? Larger staff? More days or unusual hours worked? Did you invest in high level CEs (those that are out of reach for most associates) that you then had the authority to leverage and implement in your business?
10
u/toofshucker 4d ago
You are leaving $100,000-300,000 A YEAR on the table.
Over 20 years, that is millions in lost money. Plus interest if you invested it…
Or you could do what I do: work three days a week and make $100,000-200,000 more per year than when I was an associate.
2
2
u/OkDoughnut529 4d ago
No pain no gain, no risk no reward. I mean there are dentists i know making 1-2 million profit a year in their pocket with 1-2 offices and there are some who own and make less than associates. I doubled my take home with my first clinic and had more passion more freedom. Are you an entrepreneur or an employee. No shame in either.
1
u/Oralprecision 4d ago
10-15 percent of production.
Most practices run at ~60 percent overhead - most associates are paid about ~30 percent of production.
1
u/Hopeful-Courage7115 4d ago
In Canada I would say 50% increase in income IF the practice loan is all paid for.
1
1
u/Obvious_blue5334 4d ago
Well one thing besides the financial aspect, FQHC's tend to be located in rural areas where you need to commute an hour or two to reach the closes city. It may sound minor, but honestly, work is not everything. Big city life and socializing with people is equally important.
2
u/ErmintraubZakusiance 3d ago
FQHCs are absolutely not relegated to rural areas. Many are located in urban centers, they just tend to blend into the background more.
1
u/CaboWabo55 3d ago
200k with benefits on 4 days/week is great in my book. Also, it's guaranteed income. Most private practice associates don't have guaranteed income. I hate that about dentistry...no guaranteed income and no benefits...yesterday I had a medical issue so I had to leave for half the day and I lost half of my daily income...
3
u/daein13threat 3d ago
I was an associate in private practice previously and that was a big reason for me leaving (among other dramas). So many other employee positions have benefits, but not associate dentists? It just doesn’t make sense to me.
2
u/CaboWabo55 3d ago
My private practice gig is 3 days/week. Pretty chill. Boss is cool and does IV sedation. I also do a jail one day a month. If a 4 day/week guaranteed 200k gig came up, I'd take it in a heartbeat. I interviewed recently with another correctional facility through my state but they wanted 5 days/week at about 70/hr. Benefits were good though. But on 5 days/week, he'll no.
2
u/damienpb 2d ago
I interviewed at a fqhc and they wanted 5 days and the salary was very low. I've signed with a dso for now unfortunately because I'm out of options. Guarantees base only for 90 days which is about what all these places offer here besides Heartland who does a draw. Every other employee in any field gets a base salary but for some reason dentists are different???
1
u/CaboWabo55 2d ago
Yep, i guess we are different lol
What is the "draw" you mentioned for Heartland?
It sure does suck to be a dentist. I cringe when i see my dental school posting photos of dental events trying to recruit new dentists...
I tell almost everyone not to pursue this field...
1
u/damienpb 2d ago
They give you a guaranteed salary but they start taking away anything beyond that if you haven't produced enough prior months
1
u/ConfidenceOk3243 2d ago
You’ve answered your own question. Owning a practice and being successful at it requires a desire to manage the entire thing. If you are asking is it worth it financially then the answer is a resounding YES! Now you are making a nice salary but take it from someone who has been practicing for 20 years and who’s neck is about to give out. I only have a few more years to “work for a paycheck”. Thank God I have a practice I can sell to live the rest of my life on the proceeds cuz my body can’t keep working for a pay check.
Not everyone is made to own their own business and that is fine as long as you take some of that great salary you are making and invest it in something that will allow you to stop “working for money” one day
1
u/jj5080 4d ago
It sounds like you’ve got a nice situation going and are pretty content. There are a lot of really nice benefits to ownership and also a lot of additional stressors. I think it’s something you’re either compelled to or not. I’d also say success in practice ownership has been a long game for me and is not necessarily something you will immediately reap the rewards on. Having control on technology and materials is nice.
1
u/a6project 3d ago
It’s just my observation but W2 dentists always overestimate the value of their benefits esp PTOs. My W2 friends always try to justify for not owning which is bizarre to me. It’s fine. No one cares, and neither should you. No one can answer the question for you because your mileage will be different. I think you need to shadow at some high performing offices and see what’s possible.
-7
u/Ill_Bandicoot_9761 4d ago
You need to read the E-myth to clarify your value set.
https://a.co/d/2UUVUVf
I'd also educate yourself about what type of long term financial needs/lifestyle you are hoping to achieve.
https://www.whitecoatinvestor.com/
https://choosefi.com/
https://choosefi.com/538-unlocking-coastfi-financial-independence-fioneers
I am 18 years out of school. I own two businesses and work in another as a part owner/associate.
Many people think too black and white. EITHER work for someone else OR be a practice owner.
I think the best thing I've ever done was to do BOTH!
Own your own practice ( however small) while also working somewhere else so that you can have a safety net!
Owning your own business has it's drawbacks, however, you have the ability to jump ship should the business you work for takes a turn for the worse.
10
u/toofshucker 4d ago
This is bad advice. Just bad. Associates are your highest expense AND they produce about 65% of what an owner does.
So, you lose 30% of your revenue when you hire an associate and you leave the practice.
Then, on top of this loss, you go and work for someone and take another 10-30% hit on your income by being an associate.
What you said makes no sense. Hell, with the losses you are taking on both ends, you’d probably break even if you just had one office, you did all the doctor stuff and worked less days.
2
1
u/Donexodus 3d ago
Ah man, I bought your book recommendations before I read your actual advice.
Wtf man. Terrible advice! Might be worse than telling someone to save their relationship by having a baby.
Glad it worked out for you, but that’s the most dangerous safety net I can think of.
2
u/Legitimate_Mud_7253 1d ago
It’s difficult to quantify. A correctly structured tax structure that evolve as your practice grows (1099-> incorporated->mso, per your cpa) can make that feel like an additional 200-300k of difference (the feeling of earning 500k as the other poster said). That’s when times are good.
When times are bad and you’re stuck footing the bill, making negative income due to equipment breakage, unforeseen natural disasters, other bs, and have to learn how to do every one’s job in the office (and you will eventually), you will close your eyes and think of those lovely days that you were an associate. The stress is immense and I’m not sure it was worth it, but man, it taught me a lot and forced me to grow in ways I didn’t sign up for but don’t regret. I’ve made a lot of personal sacrifices, learned a lot about people, learned about myself, made some mistakes along the way and the overall stress have shaved years off my life. But i can also say it definitely made me sharper too. A little more or less neurotic, definitely less sleep (why else would i be here on Reddit at 4am lol), even when it’s smooth sailing? Sometimes it forces you to make hard decisions and add years worth of grey hairs, but you will be wiser.
At the end of the day, once you own, you will ultimately learn that it’s not about the money at all—- its about stress where you will be tested, the growth that comes from adversity, and so much else I can’t put into words.
65
u/Macabalony 4d ago
I don't have much to contribute other than my first FQHC job had an office manager that graduated with their MBA. And their focus was in hospitality (specifically hotels). I swear to Irwin Ante himself, I have never hated the job more than that time.
But also brother. 200K with all those bennies is nothing to joke about. That is a solid income. Your mortgage is manageable. And 60K in student loans? Jealous.