Independent Practice vs DSO: Making the Choice

With dental service organizations (DSOs) becoming a prominent force in the dental industry, it may seem like independent dental practices are on the decline. But don’t give up on your dreams of following your own star just yet. For patients, dentistry is a personal experience, not just a numbers game, and practices that can balance individual care with business remain in demand. 

If you’re a new dentist considering joining a DSO to start your career, you’re in good company. According to the American Dental Association, 20% of dentists under 35 years old were affiliated with a DSO in 2019. One pandemic later, the numbers aren’t in yet, but the popularity of DSOs shows no sign of losing steam any time soon. 

 

Yet the independent practice is far from dead. Accounting for almost 75% of practices in 2019, independent practices offer many opportunities for young dentists and still present a viable long-term career path, particularly if you harbor an interest in owning a practice someday or want to use your dental skills in the service of societal or other goals. So, before you sign on the DSO line as the wave of the future, it’s worth taking a good look at what independent practices have to offer. 

Just What Is a DSO?

The term “DSO” is a broad one, covering multistate organizations as well as smaller groups of practices. The scope of services a DSO provides varies as well, from assistance with selected administrative functions to practice ownership. The common thread is that DSOs take on parts of business management that would otherwise be the independent owner’s responsibility, allowing dentists to practice the profession they trained for rather than accounting, HR management, and all the other aspects of running a small business. 

 

In contrast, an independent practice shoulders all the business decisions as well as the clinical ones. However, it’s important to keep in mind that “independent” doesn’t necessarily mean “solo.” The number of solo practitioners has been shrinking over the past 20 years, so that in 2019, only about half of U.S. dental practices contained just one dentist. But many independent practices are opening multiple locations and hiring associates to increase scale and revenue while retaining their personal touch. 

Investigate Federal Repayment Programs

If you have federal student loans that would be negatively affected by refinancing, federal repayment plans based on your income may be another option. These plans base payment amounts on a percentage of your discretionary income (as determined by your annual income and state poverty guidelines) and adjust as your income changes. In these programs, you may be able to pay off your loan before the end of the repayment period, and any remaining balance at the end of the period is forgiven—but the taxes on it are not. 

 

If you are working for a qualifying government or nonprofit organization, you may also be eligible for the Public Service Loan Forgiveness Program, which forgives the outstanding balance on eligible loans after 120 payments. Your state may offer separate loan forgiveness or repayment programs as well. 

Philosophical Differences

One term that tends to come up in connection with DSOs is “corporate dentistry.” Although this description may be more directed at large chains that own the practices involved than at smaller, dentist-owned groups, the fact remains that DSOs prioritize efficiency, and therefore DSO-affiliated practices tend to follow more standardized procedures than independent ones. This means that while the standard of care can remain high, the ability to incorporate a vision beyond dentistry may be limited. For example, if the DSO is involved in buying bulk supplies as a way of decreasing costs, it may not be possible to choose certain types of products or suppliers based on individual preference. 

 

Independent practices, on the other hand, have the freedom to create policies that reflect their own principles. This can build both patient and staff loyalty, setting up a strong team environment as well as practice stability and growth. Independent practices can also offer “added value” services to appeal to patients who need encouragement to keep up with dental care or to support those with needs that require more individual attention, such as sensory processing difficulties or anxiety.  

Immediate vs Long-Term Benefits for New Dentists DSOs

By taking care of the administrative and managerial aspects of the business, DSOs allow dentists to practice more dentistry. For new dentists, this can provide opportunities not only in terms of gaining clinical experience, but also in education and mentorship. Having a wider group of colleagues also creates a community with potential networking support. The purchasing power of DSOs, in addition to their focus on standard of care across practices, can also mean better access to current technology. And the value of any help with paying down student debt cannot be denied. 

 

Yet there are some potential drawbacks to joining a DSO. While there may be more flexibility for coverage when needed, some DSO contracts include patient quotas or appointment time standards that can be demanding. Contracts that offer help with repayment are often long-term, which can delay your ability to launch your own practice. No matter where you choose to work, always read the contract carefully, and understand how it can be terminated if the practice turns out not to be the right fit for you. 

Independent Practices

Although practice ownership out of the gate is increasingly difficult for dental school graduates, becoming an associate at an independent practice can set you up for ownership sooner than working at a DSO by giving you the opportunity to build equity in the practice. And while the business angle of practice ownership may sound daunting, the increased income can play an important role in paying off student debt and putting you on track for a reasonable retirement age.  

 

Even as an associate, being part of a private practice can allow for more expression of individuality in interests, decision making, and patient communication, while as an owner, you have the freedom to tailor your mission and office space to meet goals that go beyond basic dentistry, such as community service. 

Which Is Right for You?

So where does all this leave you, a new dentist contemplating your future? Is a DSO a safer bet than an independent practice? The answer may be a “yes” for some and a “no” for others. Keep in mind that every DSO is different and has its own merits, including many upfront benefits. And while the independent practice model may be moving away from the traditional solo practice, such a shift reflects its ability to adapt and survive. Look down the road. At the far end of your career, the rewards of independent practice—both personal and financial—may be worth embracing the risk of business as well as the rewards of dentistry.