Pacific Dental Services: The Perfect Smile
Dental
Written by Eric Slack   
Tuesday, 01 January 2008
Pacific Dental Services: The Perfect Smile - Health Executive - RedCoat Publishing
Stephen Thorne’s company provides management, administration, and IT services to its affiliates so they can focus on being dentists.

Running a dental practice involves more than cleaning teeth and filling cavities. Recruiting and hiring associate dentists, tracking down patient information, and managing the office are just a few of the aspects of owning a practice some dentists may not be prepared for. According to Stephen Thorne, president and founder of Pacific Dental Services, his company can fill in the gaps.

Pacific Dental Services: The Perfect Smile - Health Executive - RedCoat Publishing
Stephen Thorne, President and Founder
“The practices we serve are typically large, multi-specialty practices. They require a lot of management, and most dentists can’t do it on their own and practice dentistry at the same time,” said Thorne. “Our owner-doctors are our true customers, so we tie those dentists into our culture even though they aren’t our employees.”

Pacific Dental Services started in 1994 with a shared equity model. Today, PDS is affiliated with more than 140 dental practices in California, Arizona, and Nevada. Thorne believes his company’s business model of partnering with local dentists as owner-doctors allowed PDS to grow as individual doctors solidified their practices. The results are hard to ignore. In 2006, a PDS owner-doctor earned almost twice the national average income for dentists.

If you build it…
The PDS method begins with the development of the office site. Thorne’s team works the real estate markets years in advance because location is critical to the long-term success of a practice.

“We are working on 2009, 2010 deals now to ensure we get the best locations. With our buying power and balance sheet, we can get great locations, and we plan well in advance,” said Thorne.

PDS also put years into developing office infrastructure, using input from dentists to create an office environment designed to maximize efficiency. From an IT point of view, PDS strives to be ahead of its competitors. Most patients register online with its practices before their first visit. All the practices use digital X-rays, saving time for both doctor and staff. Dentists also have unlimited access to patient information through their computer system, and most PDS practices use paperless digital charts.

“Most dentists couldn’t efficiently take care of all of these things on their own. We help with accounting, payroll, marketing, legal services, and we recruit all their specialists for them. That allows them to not worry about those things and focus on how they practice dentistry,” Thorne said.

Moreover, Thorne believes the model PDS has created can be readily duplicated. The company’s goal is to add 30 affiliated offices per year in its existing markets and open in a new market every two years. Thorne mentioned Colorado, Texas, and Florida as expansion markets PDS is currently exploring.

Thorne used the example of a dentist recently affiliated with PDS. Together with a second dentist, the company purchased the practice and converted the entire office infrastructure and computer systems to the PDS platform in about four hours. This eased the growing pains usually associated with business expansions by reducing the amount of time it takes to get back to work. And the model has already proven it can work whether PDS is expanding in one of its current markets or into a new market.

…They will come
PDS invests heavily in finding dentists to join the company as owner-doctors and as practice associates, and networking is one of the ways it has grown. Within its current markets, associate dentists working for owner-doctors often want to become an owner-doctor. And though the company has not yet added affiliates in Colorado, it has been in the state for almost two years laying the foundation. By speaking at dental schools and using connections with vendors and familiar dentists who have moved into the area, PDS creates a favorable impression of its method before it sets up shop. The result is an established brand that has dentists looking for information.


“We have dentists who call us because they have heard of us and want us to provide services for them. I get at least one call a week,” Thorne said. “If one call a week gets to me, I know they’re getting to some of my other senior executives, too. We can’t even tackle that business yet, we just don’t have the resources.”

As PDS works to develop those resources, it does so in a highly fragmented industry. Unlike a cardiologist or a PCP, private practice dentists do not have the same kind of quality control usually associated with healthcare providers. Pacific Dental created its own quality improvement system to tackle this problem.

“We are still developing the system; it isn’t ideal yet. But private dentists in the US have no real oversight as to how they practice dentistry. Large groups like ours bring good quality assurance programs to the table,” Thorne said. “Collectively, our affiliated dentists have a reasonable expectation that the other dentists in the group are practicing at the same high level.”

PDS contracts with full-time auditors to help improve quality. It has a strict training program for all dentists that come into the organization, regardless of whether they just graduated from dental school or have been out of school for decades. And it can track its dentists’ performance electronically through the PDS computer system. For example, if an affiliate hired a new dental school graduate, the owner-doctors or the auditors can link to information about the first 10 root canals the new dentist performed.

“They can go on and see the quality of that work, including after-photos and X-rays. I don’t think there is another organization in the country that can do that—we’ve spent years investing in our infrastructure,” said Thorne.

PDS also has an understanding of changes happening within the industry. People are living longer and keeping their teeth, and some studies have shown a decrease in the supply of dentists. This indicates private practice dentists should have no problem setting up shop. But according to Thorne, the reality is different than the studies imply.

“We aren’t seeing a shrinking supply of dentists. Some of the studies are flawed because they are guessing when dentists are retiring. Some don’t take into account that new dental schools are opening up or the influx of foreign graduates coming into the US to practice,” Thorne said.

But one aspect Thorne said is altering the industry is the changing nature of the demographics of a dentist. More women are pursuing dentistry, and Thorne said some dental schools now enroll more women than men. The PDS model allows female dentists to own their own practice, but with the flexibility to set their own hours and raise a family.

“Our owner-doctor model and our IT and infrastructure systems are critical, distinguishing factors for us. Other companies are trying to play catch up,” Thorne said. “We could easily grow faster through acquisitions, but that isn’t our goal. We know if we’re the best in the industry, we can get pretty big. We want to be a national player, and that is what drives us.”

 
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