Dentists' Incomes Dropping, Says ADA Survey

Laird Harrison

May 09, 2012

May 9, 2012 — US dentists' incomes have been dropping steadily since 2005, mainly because Americans are using less dental care, according to a report published in the May issue of the Journal of the American Dental Association.

"That was one of the surprising results," lead author Marko Vujicic, PhD, an American Dental Association (ADA) economist, told Medscape Medical News.

Independent general practitioners' average real net income peaked at $217,850 in 2005 and fell to $192,680 in 2009, the most recent year for which data are available, according to researchers for the ADA. Before that, dentists' incomes had gone up almost every year since 1981, they said.

Dr. Vujicic and colleagues found a number of factors that helped explain the change in income, including a lower portion of the population getting dental care, fewer dental visits per patient, an increase in the number of dentists per capita, an increase in expenses for dental practices, and a lower percentage of billings collected.

The researchers focused on independent general dentists, who make up the vast majority of dentists in the United States.

The authors write that they drew on several sources for these findings. Information about dentists' real net income was derived from the ADA's annual Survey of Dental Practice, a random sample of about 4000 to 7000 dentists in private practice. They used statistical methods to make sure that the results were not skewed by trends in demographic factors such as age, sex, geographical region, and location (urban or rural).

They also drew on US Census Bureau data to find out whether the number of dentists was changing in relation to the general population, and they used the Medical Expenditure Panel Surveys from the US Agency for Healthcare Research and Quality to calculate the percentage of the population who had seen a dentist each year.

Fewer Patients, and They Are Visiting Dentists Less Often

A smaller portion of the US population is seeing a dentist annually, the researchers found, going from 40.6% in 2005 to 38.6% in 2009, or a 2.7% decline per year.

In addition, people who do go to the dentist are not going as often. The number of visits per patient fell from 2.0 in 2005 to 1.9 in 2009, for a 1.1% annual decrease. That trend started in 2002, the authors note.

Put together, these 2 trends meant a drop in the total number of dental visits in the United States from 240 million in 2007 to 226 million in 2009.

The researchers also found that dentists were not lowering their fees: Gross billings per dental visit increased from $170.35 in 2005 to $176.72 in 2009. However, the authors did identify a few other factors pushing down dentists' incomes:

  • Collection rates dropped from 94.3% in 2005 to 93.3% in 2009, part of a general slide taking place since at least 1996.

  • The number of people per dentist in the country fell from 2274 in 2005 to 2246 in 2009. However, this amounted to only a 0.3% annual increase.

  • Likewise, expenses per owner increased, but only 0.8% annually from 2005 to 2009.

Most of the drop in dentists' income came from the decline in the number of dental visits, Dr. Vujicic said. "The fact that this trend has been happening since 2003 was a surprise. Seeing a dentist is an important part of maintaining oral health, so it's a concern to the ADA."

One reason why Americans are getting less dental care is that their oral health has improved as a result of the wider use of fluoride and other preventive measures, Dr. Vujicic said. "But it's unlikely that it's all due to improved oral health." Another ADA study found that an increasing number of Americans say they cannot afford the dental care they need, he said.

Jeff Johnson, an analyst for Robert W. Baird investment company, told Medscape Medical News these trends have been reflected in the dental industry in general.

Although patients need fewer restorations, the dental products market continued to flourish because many practitioners began offering more cosmetic procedures such as whitening, implants, and clear plastic aligners, said Johnson. The market flattened from 2008 to 2010, when fewer patients could afford cosmetics.

However, there was some growth for dental suppliers again in 2011, Johnson said, and he sees grounds for optimism for dentists as well as dental companies. A Baird survey of 285 dentists found a small overall increase in profitability for their practices in the past 6 months — the first increase in years.

Dr. Vujicic, too, said a fourth-quarter 2011 ADA survey of dentists' outlooks found that they were more optimistic about their business prospects than in the same quarter of 2010.

"A Sink-or-Swim Professional Economy"

So what happens next?

The researchers found that conflicting factors make predictions difficult.

Since 2008, several states have cut Medicaid dental benefits, and some employers cut back on health benefits, leaving fewer people with dental insurance, said the researchers, citing data from the National Association of Dental Plans.

Healthcare reform legislation could put downward pressure on fees, as could the expansion of programs that license dental therapists to do procedures previously reserved for dentists.

New dental schools are scheduled for opening in coming years, and if dentists' incomes (including those from investments) continue to stagnate, some may put off their retirement, decreasing the number of patients per dentists.

However, lower income for dentists might reduce the number of applicants to dental schools.

The attitudes of patients also are shifting, Bassim Michael, an accountant whose clients include many dentists around the country, told Medscape Medical News. "Patients are way more educated," he said. "They can go onto WebMD or Google and can get an idea of what their problem is, and they can shop around. So there is increased competition, and that's putting pressure on dentists."

To survive in these times, dentists need to do more marketing and invest in the latest technology, he said.

For example, he recommended search engine optimization for Web sites and social media for marketing. He said dentists also should encourage patients who like them to post online reviews.

In addition, he recommended purchasing new equipments such as intraoral scanners and milling systems and digital and panoramic radiography so dentists can diagnose and treat conditions they might have missed in the past.

"I believe this is a sink-or-swim professional economy now," he said. "Those dentists who are aware of these changes and are proactive and make updates in their practices are realizing huge returns."

Johnson and Michael have disclosed no relevant financial relationships.

JADA. 2012;143;452-460. Abstract

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