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03/25/2014

CDA explains new ADA classifications of dental group practices


Studies are continuing to show significant expansion of dental group models in California and across the country. Their impact on the dental marketplace is making it more important to understand and classify the various practice models that exist. Group practice configurations include everything from two or more dentists working together in a dental practice, dentists utilizing a dental management corporation, or hundreds of dentists employed by a nationwide chain of dental centers.

To offer consistency in how the profession describes and talks about group practices, the ADA's Health Policy Resources Center released a research brief, A Proposed Classification of Dental Group Practices. The brief acknowledges that dentistry is a profession in transition with a growing number of large, multi-site group practices with changing character and structure. According to the ADA, group practices currently represent 5 percent of practices nationwide and are expected to grow to 20 percent by 2020.

A 2012 "Distribution of Dentists" survey supports the trend, revealing that the proportion of dentists who own practices dropped from 91 percent in 1991 to 84.8 percent in 2012, and the proportion of solo practitioners dropped during that same time period from 67 percent to 57.5 percent.

"We have seen a growing number of dentists choosing to work in group practices in California and nationwide," said CDA President James Stephens, DDS. "Some are new graduates and others are experienced practitioners making a change in their practice model."

Larger and consolidated practices generally seek to achieve greater cost efficiencies, doing so in response to a marketplace that is experiencing declining adult patient utilization, dental plan reimbursement rate reductions, expanding Medicaid coverage and younger patients proactively shopping for quality care at a lower cost.

The ADA's Health Policy Resource Center identified six basic types of group practices that indicate two or more dentists are somehow affiliated with each other. CDA plans to utilize the classification system in future communications with members to help in better understanding the dynamics of various practice models.

The classifications are as follows:

Dentist Owned and Operated Group Practice

An aggregation of a variable number and/or type of dentists in a single practice that may be located at a single or multiple sites completely owned and operated by dentists, usually organized as a partnership or professional corporation.

Dental Management Organization Affiliated Group Practice

A group practice that has contracted with a dental management organization to conduct all of the business activities of the practice that do not involve the statutory practice of dentistry, sometimes including the ownership of the physical assets of the practice. There are several types of dental management organizations and there can be significant variations in the nature of the agreements between the dentist and the dental management organization. An example is Pacific Dental Services.

Insurer-Provider Group Practice

A group practice that is part of an organization that both insures the health care of an enrolled population and also provides their health care services. An example is Kaiser Permanente Northwest.

Not-for-Profit Group Practice

A group practice that is operated by a charitable, educational or quasi-governmental organization that often focuses on providing treatment for disadvantaged populations or training health care professionals. An example is Apple Tree Dental.

Government Agency Group Practice

A group practice that is part of a government agency. It is organized and managed completely by the agency. All dentists are government employees or contractors and operate according to agency policies.

Hybrid Group Practice

A group practice that does not clearly fit into any of the above categories and can exhibit some characteristics of several of them.

"These classifications of group practices provide us with basic definitions of the various types of emerging practice models," said Stephens. "This will help CDA better identify opportunities to develop additional practice support resources to support our members who are providing care in the various types of group practices."

The ADA's research brief says as group practices evolve some may not easily fall into any one category, but the classifications will help facilitate future studies of practice configurations on patients and dentists.

Given the significant business model changes occurring in the profession, CDA will continue to carefully evaluate the marketplace and practice trends to help develop strategies that assist members in navigating the challenges and opportunities ahead. Look for future articles in the Update, Journal and newsletter and on cda.org.