469: A Tale of 2 Paths: DSO or Private Practice - Dr. Barrett Straub

A Tale of 2 Paths: DSO or Private Practice

Episode #469 with Dr. Barrett Straub

There's a better path to success than churn-and-burn dentistry. And to help you choose the best path for your career, Kirk Behrendt brings back ACT’s CEO, Dr. Barrett Straub, to explain the two paths you can take: DSO or private practice. They highlight the advantages, disadvantages, and everything else to consider when making your decision. For a roadmap to the dental practice you envision, listen to Episode 469 of The Best Practices Show!

Main Takeaways:

Understand the benefits and drawbacks of each path.

Choose the right dental career path for you.

Get a practice coach for guidance.

Have confidence. You can do it!

You control your destiny.

Quotes:

“One of the ingrained, great parts about this profession is we get to control our destiny. We get to choose how we want to practice, where we want to practice. And if you are in one segment of the industry, you can change it. Dentistry is wonderful for that aspect that we truly do control our own path.” (4:32—4:52)

“More and more dental graduates now are going into some sort of associateship, whether it’s with a DSO or another private practice. There are less and less that are as motivated getting a private practice, own their own practice, right away. I think that's a mistake — selfishly. I own my own practice. I think it’s the best. And there are lots of different reasons for that.” (7:16—7:39)

“Why would a dental graduate want to be an associate right away? There are some obvious ones. You have a lot of debt. You want to increase your clinical skills. You want to learn from more experienced dentists. You want to just get into the game a little bit. And that's totally valid.”  (7:41—8:00)

“Think ahead 10 years and literally envision what your life looks like, what your practice looks like, what kind of dentistry you want to be doing. And if that is private practice, then make decisions that move you closer to that reality. And maybe your vision of that is to be an employee dentist with a corporate [dental practice]. Great. Make decisions that move you closer to that.” (10:13—10:39)

“If you're a graduating dental student and you're like, ‘I want to be like a Barrett Straub. I want to own my practice. I want to have that work-life balance. I want that,’ then I'm going to encourage you to, if possible, find your associateship. If you want to be an associate — totally agree. That's valid. Do it in private practice. Work for a private practicing dentist that's going to show you that life, that's going to sit down and show you the profit and loss statement, the cashflow statement, the balance sheet, and is going to teach you some of the business aspects, that's going to show you what it means to run a private care practice, versus a lot of graduates who go into corporate dentistry, go into DSO knowing that they're going to transition to private practice. And that's great. But there's a lost opportunity, I think, because it’s a different model.” (11:42—12:35)

“If your goal is over here in the private practice side, find an opportunity in private practice. It doesn't mean you have to buy that practice. It doesn't mean you can't, after your two-year agreement, find a different one or go buy your own practice. But you're going to learn so much more by knowing your vision and then making decisions that get you closer to that, versus just telling yourself this story, ‘All my classmates are going to work for X, Y, Z dental. I probably need to do it. It’s easy, and they're offering a sign-in bonus.’ Well, you don't have to do that.” (12:36—13:03)

“There will always be a huge need for great private practice.” (17:49—17:54)

“Have some confidence. You absolutely can do it.” (19:23—19:25)

“A private practice dentist that owns their own practice is going to make drastically more than an associate over the course of their career — twice as much, I've read, or average of $56,000 a year over the course of 25, 30 years. So, it’s a lot.” (23:13—23:26)

“When you're a dentist and you're working for a company that has non-dentist owners, especially, they’ve got to make money. So, how do they do that? They’re going to take a segment of that profit margin, as they should, to pay for owning and having equity in that company. And so, it’s obvious that if you own your own dental practice and you're in private practice, you're going to make more, and you have more control over your destiny.” (24:04—24:30)

“I'm going to make the hypothesis that a lot of dentists find themselves into their careers, without even knowing it, they're like, ‘I'm in the high-volume, low-margin world, and I didn't even want to.’ And how that happens is we believe that we have to be in the DSO. And DSO, by definition, is high-volume, low-margin, most of the time. Most DSOs are signed on with lots of insurances, as are most private practices. When you're signed on with PPOs, you are in the high-volume, low-margin game.” (28:13—28:53)

“If we find ourselves in the low-margin, high-volume game and we’re tempted to buy a practice, add a day, hire another doctor, add some operatories, I want to say — why would doing more of the same business model increase profitability? It’s not. You're going to work harder for the same low margin.” (30:31—30:55)

“Let's say you're doing pretty good. You've got 60% overhead; you've got 40% profit. But you're writing 30% of that off to PPOs. They’ve got this thin 10%. If you buy another practice, add another doctor, add chairs, that's not just an increase of 10% more effort. That's like 90%, 100% more effort. And the headaches — exponential. 300% more headaches.” (33:28—33:54)

“Single-unit crown, I schedule an hour. I'm only in there for like 25 minutes because my assistant does the scan and makes a temp, and I come in just at the end to check. Do I go to a different operatory and start humping another procedure? No. I go down and do some email. I go talk to my front desk, and I work on stuff. It’s really nice because I'm like, ‘A crown is an hour.’ And I love crowns because I get about a half-hour of my life back to do other stuff that is needed in the business — because it’s a low-volume high profit margin.” (37:16—37:55)

“You don't have to go full fee-for-service right away — or ever. You don't have to just hack off the PPOs. Our method is going to be, ‘There are some high-performing PPOs. Let's keep those for you. There are some low-performing PPOs. Let's cut those and replace that with some people that pay 100% of your fee. Now, what did you just do automatically? You increased your profit margin a little bit.” (44:19—45:42)

“A third party, unbiased, can see our flaws a lot easier than we can. And they can see the path to improvement sometimes a lot easier than we can . . . No one does this successfully on their own. We all need help.” (1:00:05—1:00:43)

Snippets:

0:00 Introduction.

3:16 The two paths.

5:05 Things to consider when choosing a path.

13:14 Mindsets to have as a dentist.

20:10 ACT’s upcoming Money Tool.

21:49 The real value in owning your own business.

27:16 High-volume, low-margin versus low-volume, high-margin.

31:13 Stop working one out of every three days for free.

41:58 How high-volume affects quality of care.

44:00 Make more money without working harder.

47:35 Special segment with producer Andy.

57:26 Why coaching is important.

1:06:28 Wisconsin Dental Entrepreneur Program.

1:09:33 Last thoughts.

Reach Out to Dr. Straub:

Dr. Straub’s Facebook: https://www.facebook.com/barrett.d.straub

Dr. Straub’s social media: @bstraub10

Producer Andy’s email: andy@actdental.com 

Resources:

ACT Dental’s To The Top study club: https://www.actdental.com/ttt

ACT Dental’s PPO Roadmap: https://form.jotform.com/221574987947173

ACT Dental’s Dental Entrepreneur Program: https://www.actdental.com/dental-entrepreneur-program?mc_cid=7862259343&mc_eid=UNIQID

Dr. Barrett Straub Bio:

Dr. Barrett Straub practices general and sedation dentistry in Port Washington, Wisconsin. He has worked hard to develop his practice into a top-performing, fee-for-service practice that focuses on improving the lives of patients through dentistry.

A graduate of Marquette Dental School, Dr. Straub’s advanced training and CE includes work at the Spear Institute, LVI, DOCS, and as a member of the Milwaukee Study Club. He is a past member of the Wisconsin Dental Association Board of Trustees and was awarded the Marquette Dental School 2017 Young Alumnus of the Year. As a former ACT coaching client that experienced first-hand the transformation that coaching can provide, he is passionate about helping other dentists create the practice they’ve always wanted. 

Dr. Straub loves to hunt, golf, and spend winter on the ice, curling. He is married to Katie, with two daughters, Abby and Elizabeth.