Dental Practice Management: North Carolina Senate Bill Wants Dentists To Do It Themselves

Senate ruling on dental practice managementLast week in our post, Dentists Beware: The Government May Want To Tell You How To Manage Your Practice, we reported on the story of the North Carolina Senate and Senate Bill 655, which would require the North Carolina Board of Dental Examiners to examine all business contracts entered into by dental practices in their state.

Dr. Clifton Cameron, a dentist in North Carolina reported to the Fay Observer that, “Senate Bill 655 would give the Dental Board complete control of how dentists in North Carolina run their practices so they can keep fees charged to patients artificially high and insurance acceptance artificially low.”

We wrote that we couldn’t find the reasoning behind such a move by the NC Senate and Board of Dental Examiners, but the Board did post the following to their website:

“The Board has become increasingly concerned about the expanding scope and nature of management company services and agreements, and their impact on the control of dental practices by the licensed dentists.

The bundled services offered by management companies typically involve some combination of (1) administrative management services; and (2) financial management services.

Based on its knowledge of the operations of dental practices, and after reviewing management arrangements with dental practices for almost ten (10) years, the Board has identified features of management arrangements which it has determined to be highly likely to create a situation where the ownership, management, supervision or control of a dental practice is impermissibly conveyed to an unlicensed person or organization because either separately or when bundled, those features interfere with the licensed dentists’ professional decision-making and their exercise of clinical skill, judgment and supervision in the dental practice.”

After we ran our original story, several doctors commented. A New Jersey dentist wrote:

“In New Jersey, the state board already forbids outside management. My partner and I spend about 20-30 per week running my business instead of on continuing education or, patient care.

The real argument isn’t whether or not I could be one of the practices recruited by management companies, but the unfair advantage it would bring to my practice over anothers’. Lower overhead, decreased fees, increased insurance acceptance, large marketing budgets would destroy competition and lower practice values and access to care.

Management companies specify laboratory selection, supply selection, employee selection, and continuing education budgets. While they bring lower overhead, they take money from the practice as well. If you fail to be attractive, your practice cannot contract with them.

Giving this advantage to a small percentage of dentists is unfair to the majority of dentists that do not wish to join or would not be accepted. I have 10 dentists within a 0.5 mile radius. We can’t all be Aspen Dental Centers. The other 9 practices would suffer, and that wouldn’t be fair.

This is about the only aspect of dental life in New Jersey that makes practicing here worthwhile. Defeat it. Resist, North Carolina!”

Another dentist responded with:

“Have they gone mad over there? Sounds like there’s something they are not telling us about…It sounds like the insurance companies are in bed with the politicians again….”

Indeed, it could be a game changer that would impact North Carolina dentists and how they manage their dental practices. The North Carolina Office of Research, Demonstrations and Rural Health Development reports that there is already a severe shortage of primary health care providers in North Carolina, particularly in the State’s rural areas.

But perhaps this isn’t about patient care at all — or making dental practices transparent.  Perhaps this is about lawmakers just playing politics.

Who Else Wants Dentists Targeted for Tooth Tax?

tooth taxDo you think dental services should be taxed?

Apparently Vermont’s Governor Peter Shumlin believes so.

A $24 million new tax package was recently approved by the Vermont House Ways and Means Committee. They voted 7-1 on a package intended to help make up a $176 million projected shortfall in their state.

Fortunately for dentists and patients residing in Vermont, the package did not include Gov. Peter Shumlin’s plan to expand the provider tax to include dental services.

His “tooth tax” initiative would have imposed a 3% tax on the gross receipts of dental services.

Dentists in Vermont were outraged, and more than 4,500 people signed a petition with the VSDS opposing the 3% tax.

The Vermont State Dental Society vehemently opposed the tax, stating, “We believe it makes much more sense to tax items that hinder oral health like candy, soda and tobacco. Taxing health care to pay for health care is a math problem that just doesn’t add up.” The group called for dentists and patients alike to sign the petition through the VSDS website.

The controversial expansion of the provider tax to include dentists that would have raised another $3 million in revenue for the state.

Even though the increased tax would have increased Medicaid payments, dentists still believe a tax on dental services is the wrong way for the state to raise funds.

Should dental services be taxed? If you were in Vermont, would you have signed the petition?

For more on this story, see the Bennington Banner.

Taxpayers Footing the Bill for Braces in Texas

the house that braces built WFAA-TVThe business of charging taxpayers for putting braces on kids’ teeth has exploded in Texas over the last three years according to a story by WFAA-TV in Dallas.

In 2010, Texas spent $184 million on Medicaid orthodonticsmore than the rest of the United States combined.

I want you to understand, right up front, that I’m tremendous proponent of just about any program that put dollars in dentist’s pocket for providing quality dental care. Time to be honest, this level of government pork could only have been arranged in a smoked filled back room in the dead of night.

While Texas struggles with its Medicaid budget, 34 dental organizations collected more than $1 million in Medicaid orthodontics last year.

Orthodontic treatment for children is generally an elective cosmetic procedure that many parents spend thousands of dollars on for their children. Very few dental insurance carriers cover orthodontics or elective procedures such as teeth whitening.

But in Texas, Medicaid pays dentists for orthodontics per procedure, instead of a lump sum for the “finished mouth” of straight teeth, according to WFAA-TV. This has made Medicaid orthodontia a lucrative dental business in Texas.

So much so that just three years ago, dentist Richard Malouf’s All Smiles Dental Centers of Texas collected $5.4 million from Medicaid orthodontics. Since that time, All Smiles’ Medicaid orthodontics billings nearly doubled to $10.2 million. This caught the interest of Chicago-based hedge fund Equity Partners who recently acquired All Smiles Dental for an undisclosed sum.

Now Texas dental clinics are being bought up by hedge funds, making Wall Street the ultimate destination for millions of taxpayer dollars as reported by WFAA.

The following is a video of WFAA’s investigative report –

Nowhere is the lucrative business of Medicaid braces more evident than with dentist Richard Malouf’s mansion in Dallas. It is a massive French chateau with a pool house, big enough for the average American family of four to live in. The Maloufs also own the mansion next door. According to tax records the combined value of the two properties is more than $14 million.

It is known as the house that braces built.

Dr. Malouf isn’t alone in offering Medicaid braces; there are five other dentists’ offices that provide Medicaid orthodontia on the same half-mile street in Dallas. Many of them advertise free braces under Medicaid. Jefferson Dental is one such dental operation and, according to WFAA, it is owned by hedge fund Black Canyon Capital of California.

During a struggling economy, many question whether this is the best use of taxpayer dollars. A Medicaid dollar that is spent on braces is a Medicaid dollar not being spent on fighting cavities and procedures most dentists feel are necessary.

It will be interesting to see how this story unfolds. I really want to see the which legislators initiated and signed off on this this piece of legislation and who the lobbyist where who pushed it through.

I not sure other state dental boards should hire them or hang them?

For more on this story see: Tax Money for Unneeded Braces Goes to Hedge Funds

Dentists Beware: The Government May Want To Tell You How To Manage Your Practice

dentists' hands in chainsThe North Carolina Senate recently upheld Senate Bill 655, which would require the North Carolina Board of Dental Examiners to examine all business contracts entered into by dental practices in their state.

No other state in the union has implemented such restrictions on dental practice management, or sought such inclusive authority over how dentists manage their business.

Talk about the far-reaching arm of the government!

As reported by Dr. Clifton Cameron in the Fay Observer –

“As a practicing dentist in Fayetteville, I know how this legislation will impact dentistry in North Carolina.

When my partner and I established our practice in 2008, we quickly realized dental school taught us much about clinical care, but little about running a business. And the dental industry, much like the rest of the health care industry, is changing and becoming more complex.

So like many small-business owners, we looked to outside companies to help finance the practice, manage billing, handle payroll, file insurance and execute other administrative tasks. The arrangement helped our dental practice operate so efficiently that we can charge lower rates and accept dental insurance from patients.

Instead of helping foster lower fees for patients and wider insurance acceptance, Senate Bill 655 would require dentists to personally handle all the administrative tasks of their practices.

The bill would forbid dentists from taking advantage of the types of business services that millions of small businesses use. Many dentists like me would be forced to spend less time on patient care and more time on managing the complexities of a modern dental practice.

Senate Bill 655 would give the Dental Board complete control of how dentists in North Carolina run their practices so they can keep fees charged to patients artificially high and insurance acceptance artificially low.”

The North Carolina State Board of Dental Examiners position on on Management Agreements with dental practices is as follows:

“The Board has become increasingly concerned about the expanding scope and nature of management company services and agreements, and their impact on the control of dental practices by the licensed dentists.

The bundled services offered by management companies typically involve some combination of (1) administrative management services; and (2) financial management services.

Based on its knowledge of the operations of dental practices, and after reviewing management arrangements with dental practices for almost ten (10) years, the Board has identified features of management arrangements which it has determined to be highly likely to create a situation where the ownership, management, supervision or control of a dental practice is impermissibly conveyed to an unlicensed person or organization because either separately or when bundled, those features interfere with the licensed dentists’ professional decision-making and their exercise of clinical skill, judgment and supervision in the dental practice.”

Have you read about this story? What are your thoughts about the government and a State Board of Dental Examiners dictating how you administrate your dental practice?

We look forward to hearing your thoughts on this subject.

For more on this story see: Op-ed: Legislation would restrict dentistry in the state and the North Carolina State Board of Dental Examiners position at www.ncdentalboard.org (opens in a pdf file).

Dental Practice Management Still Alive in North Carolina

Dental Practice Management Still Alive in North CarolinaThe North Carolina Senate agreed on a compromise in dental legislation approved by the House regarding Senate Bill 655, a controversial bill aimed at tightening rules on dental management organizations in N.C.

The newly compromised legislation will require the State Board of Dental Examiners to adopt rules giving greater regulatory oversight of the contracts that dentists reach with the management companies in the future.

Part of the measure will require dental management contracts to include warnings encouraging dentists to obtain legal advice before signing them.

The compromise between the parties involved was reached after months of negotiations involving lobbyists, political leaders, and heavy spending on TV ads. Other states with similar dental management organizations have been watching how North Carolina would rule on this bill.

The Senate hopes the bill will clarify the existing dental law in N.C. and reduce litigation with the state dental board, which currently reviews all dental management contracts that dentists sign in North Carolina.

However, the bill still neglects to state exactly how dental management agreements would be scrutinized further.

A six-member task force, which includes two representatives from dental management companies, have been selected to make recommendations to the N.C. dental board, but the board still doesn’t have to follow their recommendations.

The task force is an attempt to ensure proposed rules will promote dentistry and alternate business models within the industry, according to Tom Fetzer, a former Raleigh mayor, ex-state Republican Party chairman.

The legislation is due to be signed by the N.C. Governor this week.

What are your thoughts on Senate Bill 655 and what has happened in North Carolina?

For more on this story see: NC Dentist Group, Office Managers Reach Agreement

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