There is no shortage of opportunities for dental practice ownership today. Many practice owners are trying to figure out how to retire and sell their practice every single day. They leave behind an entire market of patients that still need care.

Also consider the many rural areas with shortages of dentists. These are great locations to startup and build new offices to serve those communities. Finding those opportunities and then really taking a good hard look at becoming a practice owner may not be such a bad idea!

Young career dentists who want more should consider stepping out and making their dream a reality sooner than later. Especially today with the help of specialists like NEXT LEVEL CONSULTANTS, becoming an owner is easier than ever before!

This post will attempt to explore key statistics offered by ADA surveys from 2020 to 2024 examining 3 key factors that determine how profitable practice ownership is. We will break down these 3 things:

• The size of practices per owner
• Dentist’s incomes based on size of practice
• The gross billings within practices per size

For dental associates considering dental practice ownership, understanding these 3 factors is important. It really provides some perspective needed to navigate the current industry trends. These figures can help you see the strength of the industry and how ownership can be a strong path forward in your career. As always NEXT LEVEL CONSULTANTS can help you get into practice ownership when you’re ready.

Size of Dental Practices Across the Country

• Single Location Practices with Multiple Dentists: 
  • The largest segment in the industry today.
  • 39% of working dentists work in practices with one location with two or more dentists.
• Solo Practitioners: 
  • 34% of dentists are in solo practices with one location and one dentist.
• Larger Practices (DSOs): 
  • Only 16% of dentists are part of very large practices (10 to 100+ locations).
• Smaller Multi-location Practice:
  • 10% of dentists are a part of practices with 2 to 9 locations.

The Rise of the DSO Affiliation

Dental Support Organizations (DSOs) continue to play an increasingly sizeable role in the dental industry, driven by the dramatic shift in the economics of private practice. The nostalgic “good old days” of a solo dentist effortlessly working four days a week with little overhead and guaranteed above-average margins are fundamentally getting tighter.

That said, dental practice ownership today requires sophisticated business acumen to navigate rising practice expenses which have surpassed a $500,000 average for owners in 2023.

A phenomenon called “Margin Compression” a decrease in the profit margin despite practices seeing higher or even slightly increased gross revenues. This financial stressors has made DSO affiliation, particularly attractive to younger dentists. They are forgoing getting into ownership sooner and holding off till later in their career.

• Overall DSO Affiliation: 
  • About 16% of all dentists in the industry are affiliated with a DSO.
• Early Career:
  • Dentists up to 10 years out of dental school show the highest DSO affiliation at 27%.
• Mid-Career:
  • Those 11 to 25 years out have 14% DSO affiliation.
• Late Career:
  • Dentists more than 25 years out have 9% DSO affiliation.
  • This trend suggests that newer dentists are more likely to join DSOs.
• Female Dentists:
  • 18% of female dentists are affiliated with a DSO.
• Male Dentists:
  • 15% of male dentists are affiliated with a DSO.

Gross Billings for Practices (2023 data)

This report show the amount of dentistry on average as well as median numbers being billed annually. You can use this as a gauge for the amount of dentistry being practiced and billed on an ongoing basis.

Type of Dentist	Average Gross Billings	Median Gross Billings
General Practitioners
– Solo Ownership	$968,920	$896,370
– Non Solo Ownership	$734,560	$679,000
Specialists
– Solo Ownership	$1,127,620	$977,610
– Non Solo Ownership	$1,188,440	$1,029,350
All Dentists
– Solo Ownership	$1,007,790	$903,440
– Non Solo Ownership	$848,370	$729,630

General Practitioner “Solo Ownership” Billings

While gross billings have increased across the board (e.g., all practices average gross billings per practice hour increased by 6% from 2022 to 2023), the cost of running a practice is rising at a slightly higher pace as well. These figures give you an idea of what the middle of the road practice will bill every year. In order to perform at a higher rate, consider you must be better than the average practice owner. NEXT LEVEL CONSULTANTS helps practice owners achieve higher revenues through a variety of strategies and systems.

Specialist Ownership

Specialists, who already command higher gross billings per hour, further optimize their profits through “Non Solo” arrangements. The higher gross billings for “Non Solo” specialists suggest a more successful model of intra- or inter-specialty collaboration, which can boost referrals and overall practice productivity.

Dental Practice Owner’s Income Trends (2023 data)

The long-term trend in the data from 2000 to 2023 shows a consistent increase in income across all categories, with a notable acceleration in growth during the post-pandemic period (2020 onwards).

But with the rise in income, general practitioner dentists are facing a more challenging economic environment. There are some studies that are showing patients are experiencing longer wait times to get hygiene appointment. Many dentists are working extended hours because of the challenges today finding reliable staffing. These types of challenges contribute to the phenomenon known as “margin compression.” 

Margin compression means that while dentists might be working more, the profit margins on their services are shrinking, making it harder to maintain or increase their net income. This trend highlights the increasing pressures within the dental industry as a whole.

Median Net Income Growth Percentages

Looking at the data from 2020 to 2023 for

• Employed Individuals: 
  • Experienced a growth of 29.74%.
• Solo Practitioners: 
  • Saw an increase of 16.62%.
• All Owners: 
  • Showed a growth of 13.56%.
• Non Solo Practitioners: 
  • Had a growth of 12.56%.

Annual Net Income of Dentists in Private Practice (2023)

Type of Dentist	Average Net Income	Median Net Income
General Practitioners
– Solo Ownership	$204,900	$172,040
– Non Solo Ownership	$263,450	$230,070
– Employed	$177,110	$168,390
Specialists
– Solo Ownership	$322,330	$279,630
– Non Solo Ownership	$470,020	$385,470
All Dentists
– Solo Ownership	$227,750	$179,970
– Non Solo Ownership	$307,810	$247,670
– Employed	$183,910	$169,720

When looking at the data the Average Net Income is higher than the Median Net Income. This confirms that there are high-earning outliers (owner-dentists making substantially more than the norm) that are pulling the average up.

Dental Industry Income Trends Analysis

• Employed Individuals Experienced the Higher Growth Rates:
  • A rise of approximately 23.88% on average
  • From an average of $125,726.42 Pre-pandemic to $191,150 post-pandemic.
• Non Solo Owners Showed Strong Growth:
  • Non Solo ownership also experienced substantial income growth.
  • 17.67% increase in income on average.
  • Average income rose from $240,451.50 before the pandemic to $301,570 after.
• All Owners and Solo Practitioners Also Saw Increases:
  • ‘All owners’ which includes specialists observed a 16.43% increase.
  • Moving from $219,201.50 pre-pandemic to $258,260 post-pandemic.
  • Solo practitioners had an 11.16% increase.
  • Average income rose from $200,875.00 to $221,490.

All data pulled from Source: American Dental Association, Health Policy Institute, 2024 Survey of Dental Practice.			
Copyright © 2024 American Dental Association.		

Employed practitioners experienced the highest percentage growth in average net income 23%, indicating significant recovery and improvement in earnings since the pre-pandemic era. However, as demonstrated by the 2023 figures from the Survey of Dental Practice, the average annual net income for All Owners $258,260 remains substantially higher than that of Employed Dentists $191,150. This income hierarchy supports the conclusion that dental practice ownership remains strong and profitable.

Becoming a Practice Owner Provides Dentists the Ability to Increase Their Income, While Having More Control

Despite the rising challenges with students graduating with more debt along with a continued rise in corporate competition, practice ownership still remains the single best long-term career move for young dentists.

Based on the 2023 average net income figures for all dentists in private practice, an owner earns approximately $67,110 more per year than an employed associate.

The most significant figure here is: over a 30-year career, this difference in income between owner and employee can be quantified to a staggering accumulation to over $2.0 million in pre-taxable earnings.

While employed practitioners have seen a strong, short-term income recovery (a growth rate 7.5% percentage points higher than owners – between a pre and post pandemic timeframe), this recovery growth does not close the substantial and persistent annual income gap that favors ownership.

The sooner you become an owner the better off you will be down the road toward retirement. Again NEXT LEVEL CONSULTANTS can help any dentists who is considering practice ownership.

Beyond the financial advantages, practice ownership also offers the reward of complete autonomy, a benefit fundamentally unavailable for most associate dentists. As an owner, you are the Chief Visionary Officer and Executor of the clinical environment! This freedom allows you to build a true love and passion for the work you do.

As a practice owner, you gain the distinct privilege of controlling the pace and quality of every patient procedure. Ownership also affords you the benefit of hand-picking your team and developing a unique office culture as a leader. Furthermore, you can work toward investing in new technology that directly reflects your commitment and vision for the future dentistry.

Practice ownership is the only vehicle that fully converts your training, values, and vision into a cohesive, professional pinnacle of pride and fulfillment. This path, though, is not without initial challenges; can help you grow into a more well rounded clinician. That being said the administrative burden of ownership is real… but entirely manageable. Especially with help from consultants like NEXT LEVEL CONSULTANTS.

With proper planning, strong mentorship or consultation, the initial hurdles are easily overcome. The long-term investment and effort is a worthwhile trade-off for securing that freedom, income, and legacy that only ownership can provide.