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Beyond Stop-gap Staffing

03/06/2025

8 min. to read

In the fiercely competitive landscape of dental service organizations, most approaches to staffing remain reactive rather than strategic. The focus is most often on short-term wins—filling a chair for a day or covering a shift at the last minute—instead of building a foundation for sustained growth. However, as patient demand surges and market competition intensifies, leadership at forward-thinking DSOs are shifting their perspective. They treat staffing not as a stop-gap measure, but as a strategic lever for long-term profitability.

To explore this approach, I recently spoke with several DSO executives and dental leaders within the onDiem network: John Murphy, Vice President of Talent Acquisition at Aspen; Joshua Perry, CEO of Access Care; and Misty Mattingly RDH, BS, Senior Vice President and Chief Dental Hygiene Officer at Sage Dental. As some of the most experienced authorities in our industry, they candidly shared both the challenges their organizations have faced and the strategies they’ve adopted to turn staffing into a competitive advantage. Their insights, combined with broader trends, shed light on how DSOs can reframe workforce challenges as opportunities for sustained growth.

The Staffing Conundrum: Why Now?

“We’re at a crossroads,” said John Murphy of Aspen. “Demand for dental services is at an all-time high, and the workforce just isn’t keeping up. That puts enormous pressure on us and our margins.”

Murphy’s perspective is critical. In the midst of rising labor costs, evolving patient expectations, and expanding access to dental care, practices must find innovative and flexible ways to maintain capacity.

This challenge highlights a critical gap in the traditional DSO staffing model. In their quest to attract top talent, practices may sometimes underestimate the factors that keep employees engaged and committed long-term. (Smaller practices with limited resources, in turn, may not always be aware of state and local laws that require even part-time dental workers to be classified as W-2 employees entitled to all associated benefits and protections.) For many dental workers, particularly part-time staff, access to benefits and flexible scheduling can be a non-negotiable.

Addressing these issues requires creative and strategic solutions, such as collaborating with staffing partners who can offer benefits and administrative support that DSOs and practices may struggle to provide on their own. By tackling these gaps proactively, DSOs can not only reduce turnover but also enhance employee satisfaction and loyalty.

Let’s explore how staffing can become a growth driver by focusing on three critical elements: retention, quality, and optimization.

The New Growth Equation: Retention + Quality + Optimization

Transforming staffing into a growth driver requires a multi-pronged approach that prioritizes retention, quality, and optimization. These three elements come together to create a sustainable staffing strategy that addresses immediate needs while positioning the DSO for long-term growth and success.

Benefits as a Competitive Edge

Retention isn’t just about keeping staff; it’s about reducing the costs and risks of turnover. According to Joshua Perry of Access Care, “One of our early pain points was losing part time employees who needed a more comprehensive health insurance program. At the time, we simply couldn’t offer it without skyrocketing costs or administrative headaches. That’s where our staffing partnership with onDiem came into play.”

Staffing companies such as onDiem are W-2 compliant nationwide, allowing them to provide all dental professionals (regardless of their full-time or part-time status) on their platform with W-2 benefits such as comprehensive health insurance, PTO, malpractice insurance, workers’ compensation insurance, and more. Through onDiem’s SafePay™ offering, practices and organizations such as Access Care have been able to hire and book their own temps through onDiem’s platform—immediately granting them access to these benefits without dealing with the administrative burden or cost.

Perry credits onDiem for Access Care’s improved retention rate, noting that it increased significantly within the first year of partnership. “This partnership was a game-changer for us,” says Perry. “It allowed us to provide benefits to our essential part-time and temp employees without the administrative headaches—and was more cost-effective than building the infrastructure ourselves.”

Choosing a staffing partner that allows for this arrangement not only can enhance retention for the DSO, but also position the DSO as an employer of choice in a highly competitive labor market.

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Building a Pipeline of High-Performing Talent

Retention alone isn’t enough; DSOs must also ensure that the talent they retain and recruit is top-notch. “Like any other dental organization, we’ve had our share of mismatches,” Misty Mattingly of Sage Dental admits. “Sometimes we’d bring in a temp who wasn’t a good fit, and it would disrupt the team dynamic or patient experience.”

Mattingly’s solution? Building a pipeline of high-performing talent. “Our philosophy is simple: hire the best temps, and rehire them when possible,” Mattingly explained. “By treating temporary staff as an extension of our team, and choosing a staffing partner with the same philosophy, we’ve reduced mismatches and built a high-quality pipeline.”

Staffing services can play a pivotal role here by offering access to pre-vetted professionals—and in the case of onDiem, by providing access to fully W-2 compliant and certified workers to mitigate costly legal risk. Additionally, sophisticated staffing platforms allow DSOs to track and re-engage high-performing temps, creating a seamless talent pipeline.

“It’s not just about filling roles; onDiem has helped us create a system where we know the best possible talent is always within reach when we need them,” Mattingly emphasizes. “That confidence lets us focus on scaling our business and improving our standards of patient care.”

Flexible Solutions for Dynamic Needs

Staffing challenges are rarely static or fully predictable. Holidays, unexpected sick leaves, and the addition of new columns or service lines all demand flexibility. “One of our biggest headaches was managing staffing during peak periods,” Murphy noted. “We’d often end up short-handed, and it impacted patient satisfaction and care.”

Murphy’s challenge is unfortunately shared across the DSO and practice community. But by moving away from traditional and frenzied “whack-a-mole staffing,” as Murphy puts it, and toward staffing strategy that maximizes your practices’ capacity, a DSO stands to gain for the years to come. “At several of our locations, dental chairs regularly went empty, because it’s hard to ramp up when you’re in the throes of high patient need,” he explained. “Our staffing partner helped our team switch our approach, and now we are proactively staffing to each location’s full capacity, treating more patients, and witnessing significant growth in our margins.”

Flexible staffing solutions such as onDiem expertly adjust to dynamic needs—enabling DSOs to cover peak periods year-round; test new markets or specialties by bringing in specialized talent temporarily; and expand operating hours or columns without immediately committing to full-time hires.

“Our staffing partner helps us adjust in real-time,” Murphy added. “That flexibility has been a big part of our growth story.”

Dental Staffing: A Strategy for Sustainable Growth

Our partner organizations offer a compelling example of how DSOs can evolve their approach to staffing. By focusing on retention, quality, and optimization—and by partnering strategically with a staffing service — they’ve turned a regular challenge into a driver of growth.

“Staffing isn’t just about today,” Murphy said. “It’s an investment that can pay off with growth and profitability. It’s about building the kind of workforce that ensures we’re here tomorrow.”

Collaborating with Staffing Companies: A Strategic Partnership

Moving beyond stop-gap solutions requires a close partnership with staffing services. Murphy describes his organization’s collaboration with its staffing partner, onDiem, as “an evolving partnership that’s delivering meaningful results.” Based on our partners’ experiences, here’s how DSOs can get it right:

1. Align on goals
“Initially, we weren’t clear about the best way to manage and leverage temp workers,” says Murphy. “We treated staffing as a quick fix instead of a strategic tool. Once we aligned with our staffing partner on long-term goals—like entering a new market or improving retention—things started to change.”

2. Lean on data to improve quality
Modern staffing platforms such as onDiem offer analytics that can inform your staffing decisions. “onDiem helps us track and stay connected with our most effective temps,” Murphy explains. “This helps us avoid costly mistakes, and relieves some of the anxiety that comes with staffing.”

3. Use temp staffing to test the viability of new markets
Temp staffing isn’t just about filling gaps; it’s a strategic tool for expansion. “We wanted to test adding weekends or evening shifts for patients who want to be seen after hours,” Perry shares. “Bringing in temporary specialists allowed us to assess demand without committing to permanent hires.”

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Navigating the Intersection of Dentistry and Business

03/06/2025

6 min. to read

Dr. Aman Kaur
Founder and President
Women In DSO®

The dental industry has witnessed a remarkable surge in growth and innovation driven by the emergence of Dental Service Organizations (DSOs). As a result, more dentists and investors are attempting to create DSOs. However, a successful solo or small group practice does not guarantee the successful operation of a DSO, and similarly, the days of purchasing practices and later selling them for a large profit without ever understanding the business of dentistry are also over. A thorough understanding of the underlying business of dentistry and the challenges of scaling a successful DSO is critical to success.

The Rise of DSOs

In response to the rising costs of operating solo or small group practices, DSOs have continued to grow. However, nearly 65% of the dental industry remains fragmented, providing a significant runway for further consolidation and growth of DSOs.

DSOs have reshaped the traditional model of dental practices by centralizing administrative support functions, leveraging economies of scale, and providing dentists access to advanced technology and resources. This model allows dentists to focus primarily on patient care while benefiting from enhanced operational efficiency and financial stability of the DSO. As a result, DSOs have become an attractive option for established practitioners seeking long-term stability and success and recent dental graduates seeking career opportunities, professional growth and work-life balance.

Passion for Dental Care

A DSO’s true customer is its affiliated dentists.

At the heart of every successful DSO is a commitment to providing exceptional dental care and helping its providers grow as clinicians and as leaders. DSO leaders who are genuinely passionate about dentistry can then inspire their teams to deliver the highest standard of patient care while upholding shared values and professional integrity. This passion drives clinical excellence and fosters a sense of purpose and fulfillment among dental professionals, enhancing job satisfaction and patient loyalty. Investing in ongoing education and professional development for dentists and clinical team members helps to ensure they stay abreast of the latest advancements in dental
technology, techniques, and patient care practices. Pouring into teams helps teams pour out to patients.

By nurturing a culture of continuous learning and improvement, DSOs can differentiate themselves in a competitive market and attract top talent who share their commitment to excellence. This approach bolsters clinical outcomes and reinforces a supportive and positive work environment, ultimately driving the organization’s long-term success and sustainability.

Financial Growth and Business Acumen

Even though the dental industry presents significant opportunities for financial success, navigating the complexities of running a DSO requires more than basic business understanding of dental practice operations and clinical expertise. As a result, private equity and other business partners are often critical to the short-term and long-term success of DSOs. Effective partnership requires a keen understanding of financial management, strategic planning, and market dynamics for patients and providers – in addition to unwavering commitment to quality patient care.

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“Navigating the
complexities of
running a DSO
requires more than
basic business
understanding of
dental practice
operations and
clinical expertise.”

The dental landscape is constantly evolving, with shifts in reimbursement models, regulatory requirements, and patient preferences. Teams leading the DSOs must be able to look beyond what’s in front of them while also analyzing data, identifying growth opportunities, and implementing sustainable business strategies. The most successful DSO leaders stay abreast of these changes, adapt accordingly, and foster a culture of innovation within their organizations. By embracing technology, exploring new revenue streams, and optimizing operational efficiency, DSOs can position themselves for long-term financial growth and sustainability. Furthermore, having the right business partner can help integrate new technologies to alleviate pain points and maximize the value of the investment.

Building a Positive Organizational Culture

The success of a DSO hinges not only on financial performance but also on its ability to attract, engage, and retain talented dentists and team members at all levels. Cultivating a positive organizational culture starts by building trust, transparency, and mutual respect. Influential leaders prioritize their team members’ well-being and professional development, fostering a supportive environment where individuals feel valued, empowered, and motivated to excel.

Dental office staff positions are often a stepping stone to many; in order to retain and develop talented teams internally, well-defined career paths in dental organizations are critical. A career path is essential for anyone who wants to scale up a DSO by retaining talent with institutional knowledge. These initiatives must be proactive and embrace diversity of thought, background, and experiences.

Cultivating a culture of open communication and transparency also enables leaders to address challenges proactively, resolve conflicts constructively, and build consensus around shared goals and values. It is imperative to have processes to understand how front-line culture compares to corporate culture and how the two should share common principles.

Retaining Dentists

Retaining talented practitioners is very important to all DSO’s success in today’s competitive market. While competitive compensation and benefits are important, they are not the sole determinants of retention. Leaders must also create a supportive work environment where dentists feel personally valued, professionally challenged, intellectually stimulated, and emotionally fulfilled.

“A DSO’s true
customer is its
affiliated dentists.”

Many dentists today seek flexible work schedules or shorter work weeks. Flexible work schedules allow dentists to partner with other clinicians at the practice, promoting collegiality and the ability to partner on patient care. At the same time, entrepreneurship is growing among the future generation of dentists, along with their desire to have well-balanced lifestyles. This provides DSOs with a great advantage by offering affiliated dentists ownership opportunities or joint ventures to attract and retain these dentists.

Conclusion

The dental industry continues to be an attractive industry offering ample opportunities for financial growth, professional development, and clinical excellence, but it is a marathon and not a sprint. Realizing these opportunities requires visionary leadership equipped with the necessary skills to successfully navigate the intersection of dentistry and business. The dental landscape is changing quicker than most can keep up, and it’s not for the faint of heart or the novice. It’s a journey that demands resilience, dedication, and a strategic vision along with a passion for dentistry. The silver lining is that you can count on support throughout the process by partnering with experienced people who have done this successfully.

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C-Suite

Authentic Leadership

03/06/2025

7 min. to read

How Truth and Trust Drive Organizational Success

By Dr. Greg White
CEO, PepperPointe Partnerships

Speaking the truth is not always easy, yet embracing the truth fully can lead to unexpected and extraordinary adventures. While the outcome may be uncertain, letting go of the need to control outcomes allows for the opportunity to experience life’s greatest adventures in full form.

This principle of embracing truth, letting go of the desire for predictable outcomes, and trusting the process has, in many ways, shaped my approach to business. Whether consciously or not, I have adopted this ethos as a cornerstone of my leadership philosophy: tell the truth, trust in the adventure, and have faith that everything will work out as it should.

For me, this goes beyond mere optimism. It is a belief in the power of transparency and authenticity to guide organizations toward meaningful progress. When applied to leadership, the practice of telling the truth and embracing the unknown can radically transform the trajectory of a company while simultaneously empowering and retaining the right people on the team.

The Foundation of Organizational Culture: The People

Before delving into the transformative power of truth in leadership, let’s first recognize where organizational culture begins — within the people themselves. It is an obvious truth, yet it deserves constant reaffirmation. The individuals who make up a team are the heartbeat of the organization’s culture. They are the architects of its development, the stewards of its maintenance, and the ones who bring the ethos of the company to life daily. They all have one thing in common: they share core values!

No amount of strategy or planning can replace the need for the right people in the right roles. Cultivating a culture that is not only aligned with the company’s purpose but also fosters collaboration, trust, and innovation is a direct result of the individuals who embody those values and principles.

The Continuity of Culture: Shared Purpose

At its core, organizational culture is not defined by what you do, it is defined by who you are as an organization. Understanding this distinction is crucial to building a resilient culture. The question you must ask is not just, “What products or services do we offer?” but also, “What does our organization stand for?” and, “How does what we stand for resonate with our customers?”

This clarity of purpose needs to be communicated clearly and consistently with team members. It is a leader’s responsibility to be transparent about where the company currently stands and where it is headed. Without this clarity, the absence of a clear direction breeds anxiety and confusion among teams. When people do not understand the destination or how to get there, progress stalls.

While your core values and the essence of an organization’s purpose should remain unchanged, the specific goals and strategies adapted to achieve them must evolve. The marketplace, technologies, and societal needs will always shift, and companies risk stagnation by failing to adapt. A testament to a successful leader is one that is flexible, willing to pivot when necessary, and open to refining strategies to continue pushing the organization forward.

Trust: The Bedrock of Momentum

Trust, in my experience, is not something that can be demanded — it is something that must be earned, day by day, through consistency, honesty, transparency, and reliability. It is the foundation upon which all productive and meaningful relationships are built.

When trust is established within a team, it creates an energy that propels everyone toward achieving shared goals. People are more likely to invest time, effort, and passion into something they believe in and trust. This trust fuels momentum, turning ambitious goals into tangible accomplishments. But for trust to flourish, leaders must demonstrate a consistent commitment to doing the right thing — especially in times of uncertainty or difficulty.

Tips for Building Trust

→ Communicate transparently.
→ Act consistently.
→ Do what you say.
→ Foster collaboration and relationships.
→ Acknowledge contributions.
→ Provide timely and constructive feedback.

The Path to Innovation: Structure and Flexibility

Innovation thrives in environments where ideas can be freely shared and explored, but ideas alone are not enough. To transform an idea into a breakthrough product, service, or process, it must be integrated into a well-defined structure that enables its practical implementation.

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The true challenge lies in the intersection of creativity and efficiency: structuring innovation so that it is both inspiring and achievable. While the possibilities are endless, it is essential to focus on ideas that are not only compelling but also realistic.
Ideas that inspire action and are within the realm of possibility. This is where a team’s creativity and technical acumen come into play. By establishing a system that can produce, refine, and implement those ideas, leaders build a culture of innovation that has the potential to change the trajectory of the entire organization.

Moreover, maintaining flexibility and clarity are the keys to sustaining innovation. The business world is constantly evolving, and staying
attuned to industry trends, customer feedback, and technological advancements is crucial for adapting and evolving ideas.

A Culture of Accountability and Adaptability

Accountability is a central tenet of a high-performing team. It begins with leaders who hold themselves accountable first, leading by example in every decision, choice, and action. Once leaders demonstrate this commitment, they can foster a culture where team members feel empowered to hold themselves and each other accountable as well. This isn’t about enforcing rules but instead about creating a shared sense of responsibility for success. If done well, leaders manage the process, not people.

Accountability and adaptability are especially critical in industries that are prone to disruption and rapid change. In such environments, sticking to old strategies simply because they were once effective is a recipe for failure. Instead, leaders must be willing to adapt, shift strategies, and reassess goals in response to external changes.

Being flexible doesn’t mean abandoning principles. Sometimes, it means being willing to evolve tactics and find new ways of achieving the same long-term vision. In fact, innovation often stems from the willingness to take risks, experiment with new ideas, and continuously adapt.

Building a Strong Team: The BHAGs

At the heart of any thriving organization is a team that is united by a bold, shared vision. This vision, often articulated through Big Hairy Audacious Goals (BHAGs), provides a compelling sense of direction and purpose. These goals should be ambitious, challenging, and inspiring — just enough to motivate a team to push boundaries and dream big.

When building a team, look for individuals who are not only seeking a paycheck but also deeply invested in the company’s mission and vision. Seek out individuals who are passionate about making a tangible difference, who believe in the core values that guide the organization, and who are committed to the shared journey toward achieving BHAGs.

Building a team like this requires cultivating an environment where each individual feels valued, supported, and empowered to contribute their best work. Whether through pilot programs, ongoing professional development, or fostering a spirit of collaboration, leaders must ensure that they are investing in the growth and well-being of their team, which will further their attachment to not only the company, but its mission.

Conclusion: Lead Through Truth and Trust

To lead effectively, leaders must embrace the truth — both the successes and the failures — and trust that it will guide teams through the unknown. Leadership is not about controlling the outcome but empowering the team to navigate the journey together. By building a culture of trust, accountability, and innovation, and by maintaining a deep commitment to an organization’s core values and purpose, leaders can set companies on a path toward sustainable growth and success.

In the end, when you lead with authenticity and a shared sense of purpose, teams will not only follow, but you will also inspire them to embark on the greatest adventure of their careers. And together, there is no limit to what can be achieved.

Dr. Greg White

Dr. Greg White serves as the president and CEO of PepperPointe Partnerships, and is one of the founding partners of White, Greer and Maggard Orthodontics (WGM). WGM formed in 1991, and is currently par of one of the largest, privately-owned pediatric and orthodontic group practices in the country. Prior to leading PepperPointe’s significant growth, he actively practiced orthodontics for more than 25 years.

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AI-Powered Dentistry

03/06/2025

7 min. to read

What’s Real, What’s Coming, and What to Do About It

Artificial intelligence (AI) has undeniably surged into nearly every industry, and dentistry is no exception. What was once the realm of science fiction is now a practical reality transforming how we work. This explosion of AI technologies is more than just a trend; it’s a seismic shift. Visionaries like Bill Gates have compared AI’s significance to groundbreaking innovations like electricity and the internet. Sir Patrick Vallance, the UK’s former chief scientist, even likened its impact to the Industrial Revolution. And as Google’s Sundar Pichai put it, AI is “more profound than fire or electricity.” In dentistry, AI is not just a tool but a transformative force that is reshaping the future of patient care and practice management.

While AI is often over-hyped, its potential and impact are undeniable, especially in healthcare. In dentistry, AI offers unprecedented opportunities to enhance operations, improve patient outcomes, and stay competitive in an increasingly digital landscape. But, it is not a magic bullet — it’s a broad toolkit that requires thoughtful application. Understanding when, where, and how to use AI is key to maximizing its benefits. The practical benefits of AI, such as faster and more accurate diagnostics, streamlined administrative tasks, and improved patient experience, should reassure you about its potential in practices of all sizes.

AI in Dentistry: What’s Real
Dentistry, though traditionally grounded in hands-on expertise, is seeing the benefits of AI across operations. From automating routine tasks to enhancing clinical decision-making, AI is enabling dental professionals to deliver faster, more accurate, and personalized care. The transformative power of AI can be seen in several key areas:

Enhanced Diagnostics:
AI-driven diagnostic tools analyze radiographs with high accuracy, detecting early signs of decay, gum disease, or oral cancer that may be missed by the human eye. This leads to earlier interventions and better patient outcomes.

AI Enhanced Workflow:
AI streamlines appointment scheduling, patient reminders, clinical documentation, and billing, reducing administrative burdens and freeing staff to focus on patient care.

Predictive Analytics:
AI-powered tools analyze patient data or company operations data to predict future outcomes, such as identifying patients at higher risk for conditions and suggesting preventive measures. For example, by analyzing a patient’s dental history and lifestyle factors, AI can
help identify those at higher risk for diabetes and suggest exercises and dietary changes.

Improved Patient Experience:
AI can enhance patient experience by enabling efficient and personalized care. Virtual assistants, for example, can provide patients with instant answers to common questions, reducing wait times and improving overall satisfaction. AI-enhanced radiographs highlight areas of concern, making it easier for patients to see and understand their diagnosis and treatment plans.

Marketing and Creative Services:
AI is also revolutionizing marketing and creative services in dentistry. For instance, AI can generate personalized content and marketing strategies tailored to specific patient demographics, helping practices attract and retain patients more effectively. An example
is using generative AI tools to create targeted social media campaigns, which can significantly improve patient engagement and brand visibility.

Survey Insights
A quick survey of our readership suggests most companies are using AI in some capacity. Group and single practices are more likely to have adopted AI, particularly in computer imaging, while industry suppliers and service providers are far more likely to use AI for marketing. Both sectors have seen improvement in administrative efficiency, with over 70% of practices reporting revenue growth from AI implementations.

Upcoming investments will focus on automating administrative tasks, and upskilling workforces to leverage AI. If you feel behind in AI adoption, you’re not alone— nearly 30% of organizations consider themselves lagging their peers in this area.

If you feel behind in AI adoption, you’re not alone — nearly 30% of organizations consider themselves lagging.

Debunking Myths of AI in Dentistry
Despite its benefits, AI in dentistry is surrounded by myths that can deter adoption. It’s time to set the record straight.

Myth #1: AI Will Replace Dentists
Reality: AI enhances, not replaces, human expertise. While AI can handle certain tasks with high accuracy, it cannot replace the nuanced decision-making and personalized care that dentists provide. AI’s role is to enhance diagnostics, streamline operations, and support better decision-making, but it is the dentist’s expertise that ultimately guides patient care.

Myth #2: AI is Too Expensive
Reality: While initial investments may be required, the long-term savings and ROI— through automation, improved diagnostic accuracy, and enhanced patient retention — far outweigh the costs.

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Myth #3: AI is Only for Large Practices
Reality: AI solutions are scalable and accessible to practices of all sizes. Even smaller practices can leverage AI to improve efficiency and patient satisfaction.

Myth #4: AI is a Singular Technology
Reality: AI is an umbrella term encompassing various technologies like machine learning, natural language models, computer vision, and robotic process automation. These technologies work together to create powerful, layered solutions.

Myth #5: AI is Complicated to Implement
Reality: Many AI solutions are designed for seamless integration with existing systems. Comprehensive support from vendors ensures smooth transitions.

Myth #6: AI Can Solve Every Problem
Reality: Not every problem requires AI. Start with a clear business need, not the technology. Throwing AI at poorly defined problems leads to wasted resources and disappointment. AI should only be used when traditional methods do not provide an optimal solution. The fastest way to derail enterprise value is to throw AI at problems that are poorly defined or better suited to non-AI solutions.

Common AI technology applications available today:

Robotic Process Automation (RPA):
Rule-based software automations for repetitive computer-based tasks.

Robotic Assistant Systems:
AI-fed hardware that perform various physical healthcare tasks designed to enhance precision and improve outcomes.

Natural Language Models:
Understand, interpret, and generate human language.

Machine Learning (ML):
Identify patterns in data and make insights or decisions based on those patterns. This includes simple to complex patterns and relationships in data. Types of data science and ML include predictive analytics, deep learning models and expert systems.

Computer Vision:
Analyze images for diagnostics and treatment planning.

Generative AI:
Creation of text, narratives, characters, music, tones, voices, and images. Virtual Assistants are applications of these capabilities.

How to Integrate AI Into Your Practice

A strategic and methodical approach is essential to successfully integrate AI into a dental group practice.

Here’s how to navigate the process:

1. Strategic Planning

Conduct a Needs Assessment: Identify your practice’s pain points and where AI could offer the most value.
Set Clear Goals: Define measurable objectives, such as improving diagnostic accuracy or reducing no-show rates.
Data Quality: Ensure your technology infrastructure and data quality are solid before introducing AI.

2. Engage with AI Experts

Network: Consult AI experts or join industry groups. Learn from other practices that have successfully integrated AI.
Research Providers: Compare AI vendors based on ease of integration, support, and cost. Use demonstrations or trials to evaluate fit.

3. Training and Onboarding

Upskill Your Team: Provide comprehensive training for staff and appoint a “technology champion” to lead the transition.
Establish Best Practices: Create guidelines for interpreting AI-generated data and escalation protocols for human oversight.

4.Focus on Patient-Centric AI Applications

Ensure AI implementations improve patient care and experience. Whether through accurate diagnostics, personalized treatment, or enhanced communication, the patient should always be at the center.

As AI evolves, the dental industry will continue to benefit from more advanced tools and techniques. Practices that adopt AI now will lead the future, delivering superior care while achieving sustainable growth. AI is not a distant concept — it is here to stay, and its impact on dentistry is real. With the right strategy, tools, and training, your practice can harness the power of AI to enhance operations, improve patient outcomes, achieve sustainable growth, and stay ahead of the curve.

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The Definitive DSO Report

10/17/2024

4 min. to read

By Brian A. Colao
Director, DSO Industry Group at Dykema

2024 2nd and 3rd Quarter DSO Industry Update

The DSO industry is facing unprecedented economic challenges, marked by record-high interest rates, rising labor costs, and increased expenses for supplies and materials, compounded by persistent inflation since mid-2022. Although there are signs of improvement in inflation and interest rates, uncertainty persists, particularly concerning U.S. job reports, upcoming economic data, and the presidential election. This update highlights key areas of interest for the DSO sector.

M&A Update
The consolidation of dentistry, which began around 2010, accelerated rapidly until early 2020. The pandemic then caused a temporary slowdown, but consolidation rebounded strongly in late 2020 and throughout 2021, reaching unprecedented levels. By the end of Q2 2022, however, rising interest rates significantly impacted large transactions. Many large DSOs paused their recapitalization efforts. Some DSOs have managed to secure substantial credit facilities, indicating ongoing confidence in the dental market.

In 2022 and early 2023, smaller transactions continued relatively normally until mid-2023, when they also experienced a slowdown. Large DSO transactions have been scarce, and prospects for improvement uncertain, heavily influenced by the upcoming presidential election. A new administration might implement measures to reduce interest rates and inflation, potentially revitalizing large transactions. However, the timing and valuations of such a resurgence remain unclear, especially given the record high valuations before the downturn.

Smaller transactions persist, but at a reduced pace and lower valuations compared to 2021. While some traditional buyers are currently unable to pursue acquisitions, others are limited to fewer transactions. A few buyers are maintaining normal transaction volumes, and new entrants are exploring the DSO market, providing some optimism.

The final quarter of 2024 is expected to be critical, with year-end economic reports and the presidential election likely affecting significant DSO transactions. Despite current challenges, high demand for transactions and many willing sellers suggest a positive outlook for the future.

Valuations for smaller transactions are now highly organization-specific, influenced by:

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Payer mix
Growth potential
Specialty integration
Infrastructure adequacy
Cost savings and economies of scale
Organizational culture
Seller’s business and leadership skills
Regulatory considerations

DSO Priorities for 2024
Traditionally, DSOs focused on increasing EBITDA through mergers and acquisitions. However, current economic challenges have shifted priorities toward same-store growth, aiming to organically boost EBITDA organically. Strategies for same-store growth include technological innovations such as AI solutions, patient finance tools, RCM tools, discount and membership plans, and specialty integration. Progress in these areas has been slower than anticipated due to subscription fees, capital investment costs, and integration issues with many vendors lacking open architecture.

Fortunately, many of these issues are being addressed, and ongoing case studies on technological innovations for same-store growth are expected to yield valuable insights soon.

Another key priority for DSOs in 2024 is renegotiating credit facilities to ensure adequate capitalization for the coming years. While some DSOs have managed this process smoothly, others face challenges, with some resorting to receivership or bankruptcy. This area requires close monitoring.

Regulatory Update
The challenging economic climate has intensified regulatory scrutiny and enforcement, with various entities seeking to recover funds. In 2024, this has resulted in:

Increased auditing and enforcement from Medicaid and private insurers, leading to substantial and often unrealistic repayment demands.
Stricter HIPAA enforcement, accompanied by significant fines and penalties.
Heightened enforcement of labor and employment laws, leading to a rise in individual and class-action lawsuits.
Increased actions to recover PPP loans, with the government scrutinizing loan recipients’ compliance amidst conflicting advice and unclear guidance from 2020.
Growing disputes with affiliated dentists, particularly regarding dissatisfaction with DSOs unable to complete recapitalization events.

These developments reflect a response to economic difficulties, with stakeholders seeking revenue under sometimes questionable circumstances. This heightened regulatory and litigious environment is expected to persist until broader economic conditions improve.

Dykema DSO Conference Recap
A notable highlight of an otherwise challenging year was the 2024 Dykema DSO Conference, which set a new attendance record, becoming the largest event in the DSO industry’s history. With over 2,000 attendees, the conference offered exceptional content, networking opportunities, and overall experience. The 2025 Dykema Conference is scheduled for August 6-8, 2025, at the Gaylord Rocky Mountain Resort in Denver, with the aim of breaking another attendance record. Registration will open in January of 2025 at Dykemadso.com.

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The Science of Positivity

10/17/2024

9 min. to read

You are what you think

MARTIN R. MENDELSON, DDS, FIADFE, CPC

Your thoughts shape your emotions, guide your actions, and manifest your results. In the world of dentistry, challenges abound regardless of your role in the practice. When working with dental professionals and their teams, I’ve observed that mindset and transparent communication are the linchpins that differentiate good teams from exceptional ones. Fostering a cohesive and contented team is not just desirable but indispensable in today’s dental landscape. Easier said than done.

Dr. Viktor Frankl, a leading authority in neurology and a Holocaust survivor, made a powerful observation about human behavior when he said, Between stimulus and response, there is a space. In that space, is our power to choose our response. In our response, lies our growth and our freedom.” Our interpretation of stimuli guides our responses. Thus, the pivotal factor is not the event itself but how we perceive and react to it. What does this mean for dental providers?

Consider this scenario. It is your practice’s policy not to leave contaminated instrument trays in the sterilization room unattended. One day, you discover this policy was violated. Because of the instruments on the tray, you immediately know who left them. So, the instruments left in the sterilization room is technically neutral. As Dr. Frankl describes, what happens next is how you choose to interpret this action.

You might think this individual did it intentionally, or you may even wonder, “Why do I have to do everything around here?” — now, you
are angry. Your thought has given rise to an emotion, which is now facilitating an action. So, you decide to give this person a piece of your mind. You march towards the break room to find them.

When you find this colleague, they are crying. Why? Something awful had just happened in their lives. Now, what are your thoughts? Now, what are your actions? What changed? How would giving them a piece of your mind manifest in the result of processing those instruments? It doesn’t.

Once you discovered the colleague in the breakroom, the only thing that changed was your thinking about the situation based on new information. The fact a procedural policy was violated still exists. You went from anger to compassion in the blink of an eye because an assumption was voided.

How often have you encountered this type of scenario — not the same one, but one where something happens, and there is an interpretation? The resulting actions (or silent treatments) can be carried out for days, weeks, months, or even years. What would it be like to have a culture where all practice members are expected to communicate on a different level?

This shift in thinking exemplifies the ability to reframe reactions. The adage, you cannot teach an old dog new tricks is false, and there is a term for this. The term is neuroplasticity. Dr. Matt Puderbaugh1 describes it as “a process that involves adaptive structural and functional changes to the brain. It is defined as the ability of the nervous system to change its activity in response to intrinsic or extrinsic stimuli by reorganizing its structure, functions, or connections.”

So, yes, anyone can learn new thought patterns, and positive brains will help your dental practice succeed. Creating a cohesive and
happy team is possible. When I work with teams, we create an agreement, a constitution, and a contract that focuses on what kind of practice we want to attend every day, how we agree to show up when there are challenges, and how we agree to keep each other accountable.

This exercise establishes a mindset that can change the face of a practice. By opening the door to effective communication, all parties are able to be heard and gone are the days of sweeping things under the rug. Trust is established. Teams work together to provide excellent patient care by prioritizing effective communication and mutual respect.

Science supports the importance of a positive mindset.

Positivity Influences Brain Function

Dr. Barbara Fredrickson’s Broaden and Build Theory2 substantiates that a broadening effect of our cognitive function is biological. The “positive chemicals” of dopamine and serotonin help us to feel and function better. These chemicals allow for additional neural connections, allowing us to think more clearly and creatively and become more adept at complex analysis.

Reflect on moments when you’ve felt upset, exited a conversation, and regretted not expressing specific thoughts or missing key points. Barbara Fredrickson’s Broaden and Build Theory offers a compelling rationale for such experiences.

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Positivity Helps Us See

A study by Dr. Taylor W. Schmitz3 showed that our mood changes how effectively our visual cortex operates. Individuals were shown pictures.
Participants in negative moods did not process all the details in the pictures. They missed significant parts of the background. Those in good moods saw all the details.

In another study by Dr. Heather A. Wadlinger4, participants who were trained to concentrate on positive information selectively “looked significantly less at the negative images in the visual stress task following the attentional training, thus demonstrating a learned aversion to negative stimuli.”

Comprehensive attention to detail is crucial in a dental practice regardless of your role. If team members harbor negative mindsets, it will impact your bottom line.

Positivity Influences Diagnosis

Clinicians need to assimilate large volumes of information to make a diagnosis, and inflexibility in thinking or anchoring (trouble letting go of an initial diagnosis or the anchor), even in the face of new evidence, can be detrimental to the diagnostic process.

Dr. Carlos Estrada5 sought to investigate the influence of a positive effect on clinical reasoning, anchoring, and efficiency. In his study, he split physicians into groups, and they were given medical information to review and then come to a diagnosis. The group that was promised some candy (i.e., primed to be positive) demonstrated less anchoring and came to a diagnosis faster than the other groups involved in the study. Even just a minimal burst of positivity affected their diagnostic acumen.

Treatment planning and case acceptance are the bread and butter of any practice. Imagine what we may be missing by harboring negativity instead of working through it on a more regular basis.

Positivity Influences Performance

A study by Bryan assessed the impact of positive moods on students’ feelings of self-efficacy and math performance. A group of students were asked to remember one of the happiest days in their lives before taking a standardized math test. Those students who were asked to remember these happy times outperformed the other students not asked to recall fond memories. The study concluded that “children in the positive-mood condition completed significantly more problems accurately than children in the no-treatment control condition.”

Positive brains operate more efficiently, enhancing diagnostic accuracy with fewer missed details. Psychology devotes an entire branch to positivity, and these studies barely scratch the surface. Studies and knowledge are one thing — action is another.

Now, take tangible steps forward to cultivate positivity and improve team dynamics with these suggestions:

Establish a culture of transparent communication.

Create an agreement or constitution outlining expectations for communication, teamwork, and accountability within the practice.
Hold regular team meetings or huddles to discuss practice policies, challenges, and successes openly.
Encourage team members to express concerns, share ideas, and constructively provide feedback.

Integrate gratitude practices into daily routine.

Start each day with a morning huddle focused on expressing gratitude for successes and positive experiences and identifying challenges.
Encourage team members to share moments of gratitude, whether related to patient care, teamwork, or personal achievements.

Promote a positive mindset and resilience.

Provide training or workshops on the science of positivity and the impact of positive emotions on cognitive function.
Offer resources for team members to develop resiliency skills, such as mindfulness practices, stress management techniques, and self-care strategies.
Foster a supportive environment where team members feel empowered to overcome challenges and bounce back from setbacks with optimism.

Cultivate strong interpersonal relationships.

Encourage collaboration and mutual support in daily interactions, emphasizing the importance of treating colleagues with kindness and respect.
Provide opportunities for team members to engage in activities in and outside work to strengthen bonds and foster camaraderie among team members.

As a profession, we stand as heroes, alleviating pain, restoring function, and nurturing self-confidence through aesthetic procedures. Our work is undeniably miraculous. In your most challenging moments, I urge you to keep this in mind.

We have all fallen into patterns of thinking that have served us in one way or another to get us to where we are today. If you are feeling stressed and burnt out, you can change your patterns to better serve you. You cannot choose everything in life, but you can choose your
attitude. By cultivating a positive mindset and fostering open communication, dental professionals can navigate challenges with resilience and optimism to enhance patient care and practice outcomes. As the dental industry continues to evolve, may we embrace positivity as a guiding principle, empowering us to overcome obstacles and thrive in our incredible field.

Dr. Martin R. Mendelson

Dr. Martin R. Mendelson, FIADFE, CPC, leverages his clinical background to empower leaders for over two decades. Through Metamorphosis Coaching, he enhances decision-making and fosters excellence-driven cultures. Dr. Mendelson’s unique approach focuses on internal T.E.A.M, (Thoughts, Emotion, Action, Manifestation) versus External T.E.A.M. (Trust, Engagement, Accountability, Mindset), profoundly impacting team cohesion and productivity.

He can be reached via both his:
Website: www.martinmendelson.com
LinkedIn: www.linkedin.com/in/metamorphcoach/

References

1. Puderbaugh M, Emmady PD. Neuroplasticity. [Updated 2023 May 1]. In: StatPearls [Internet]. Treasure Island (FL): StatPearls Publishing; 2023 Jan.
2. 2004 The broaden–and–build theory of positive emotions Phil. Trans. R. Soc. Lond. B3591367–1377
3. Opposing Influences of Affective State Valence on Visual Cortical Encoding Taylor W. Schmitz, Eve De Rosa, Adam K. Anderson Journal of Neuroscience 3 June 2009, 29 (22) 7199-7207; DOI: 10.1523/JNEUROSCI.5387-08.2009
4. Wadlinger HA, Isaacowitz DM. Looking happy: the experimental manipulation of a positive visual attention bias. Emotion. 2008 Feb;8(1):121-6.
5. Carlos A Estrada, Alice M Isen, Mark J Young, Positive Affect Facilitates Integration of Information and Decreases Anchoring in Reasoning among Physicians, Organizational Behavior and Human Decision Processes, Volume 72, Issue 1, 1997, Pages 117-135,
6. Bryan T, Bryan J. Positive mood and math performance. J Learn Disabil. 1991 Oct;24(8):490-4.

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The Invisible Engine Behind Scalable DSOs

10/22/2025

7 min. to read

Your Tech Stack, Unstacked

By Alan Rencher
Chief Technology Officer, Henry Schein One

In my conversations with DSOs, I’m consistently struck by how many still rely on a patchwork of third-party vendors to run their operations. Think about the sheer number of systems involved in a single day—imaging, revenue cycle management, scheduling, analytics—each handled by a different tool. How much time is being wasted manually entering data, fumbling to find patient information, and clicking between tools?

In today’s rapidly evolving dental landscape, scaling successfully means investing in a tech ecosystem (tech stack) that doesn’t just support growth, but actively drives it.

To run your DSO effectively now and in the future, you need a tech stack that adapts easily, improves your team’s efficiency, and enhances every step of the patient’s experience.

What Your Tech Stack Should Do for You
When I talk about tech stacks, I’m referring to the tools and technologies you use to run your organization. Think of it this way: You don’t carry a phone, camera, voice recorder, and Walkman anymore. You carry a smartphone that gives you access to everything. A tech stack functions the same way.

Your tech stack is the heartbeat of your operation, and it should do more than just function. It needs to bring clarity and confidence at every stage. And when it provides the four things below, your DSO’s growth can finally be unlocked.

01
It Should Simplify Workflows and Amplify Results
Your tech stack should eliminate redundancies and manual tasks, dramatically reduce administrative workload, and—most importantly—help create a better patient experience.

A truly connected platform should create automated synergies between common workflows. I’m excited by the work our team has done to address this, streamlining the entire patient intake process, from booking to check-in to payment.

• Revenue cycles run themselves.
• Capacity planning is proactive.
• Patient experiences feel seamless, every time.
• Your data tells you what to do next—before you even ask.

A patient finds your practice on Google, books an appointment, and completes their forms—scanning their ID and insurance card right from their phone. That information flows directly into the patient record—no manual entry, no errors.

Insurance eligibility is verified automatically ahead of the visit—without front office staff spending time calling payors or digging through portals. Your patient walks in and your team is already prepared with their information and benefits confirmed.

During the appointment, imaging is annotated with AI and tied to the treatment plan with transparent cost visibility—giving patients the confidence to move forward. CDT codes are applied instantly. Claims go out clean. Denials drop. Cash flow improves. This is smarter care in action—where technology works quietly in the background, and your team gets back to focusing on patients.

I’ve seen large DSOs produce some significant results with a more connected platform. For example, Areo Dental, based in Chicago, has seen 20% growth thanks to connected cloud-based technology, revenue management automation, and real-time data analytics. 42 North Dental, based in Massachusetts, has seen the benefits of standardizing operations, and can now manage data collection, among other things, for all 96 of its practices.

02
It Should Protect Your Data
I firmly believe that credible technology companies have a responsibility to protect your patient and practice data, and the security measures they implement should be just as important as any other software feature.

You shouldn’t have to worry whether your practice management system is secure. Those controls should be in one place, managed by your vendor’s team of experts who handle security concerns like edge protection, secure coding practices, and cyber incidents.

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Let’s bring back our friends at 42 North Dental: Security played a huge role in their decision to move to the cloud. Centralizing data management in a secure cloud environment provides a far more robust disaster recovery strategy than managing disparate, on-site servers.

One of the things I always say is, “It’s not a matter of if a breach happens, but when.” Data security is nonnegotiable. We were pioneers in this area with Dentrix Ascend as the first cloud-based practice management system to meet SOC 2 Type II compliance standards, which helps us protect against data breaches and offers a secure audit trail for prescriptions, treatments, and records.

Security is at the root of your tech stack, so the first question you’ll want to ask any potential software provider is “Do you have SOC 2 Type II certification?”

03
It Should Give You the Freedom to Connect—Anywhere
Being untethered from a physical workstation empowers real-time decision-making and the flexibility to pivot instantly as situations evolve. This mobility benefits more than just your team—it transforms clinical operations as well.

I often hear from DSOs how essential the cloud is to their operations. Doctors are able to seamlessly move between locations while maintaining access to all essential patient information. Scheduling and communication don’t need to be done at a desktop.

These DSOs are able to access key practice data and workflows from any internet-connected device, enhancing communication, collaboration, and overall efficiency across their team. For instance, FlossTime, a Boston-based mobile dentistry practice, depends on cloud-based Dentrix Ascend to access patient files, send texts for appointment reminders, and manage online bookings from anywhere.

I also hear how using the cloud helps you be you. For example, sending in a prescription after hours for a patient while you’re at your daughter’s soccer game or quickly checking a report in your car before taking your dog to an appointment—the cloud provides that secure, trusted connection when you need it, wherever you need it.

04
It Should Be Customizable to Meet Your Unique Needs
As part of my role as Chief Technology Officer, I’m constantly considering how technology can empower DSOs. With our API exchange, DSOs can effortlessly connect trusted third-party applications or build their own. This ability to build custom integrations has allowed DSOs like Kare Mobile to address very specific operational needs.

For instance, Kare Mobile developed DentaFlo, their own scheduling system that automates appointment booking. By connecting DentaFlo with Dentrix Ascend through our API, they’ve automated scheduling for over 1,500 appointments, resulting in significant time savings. This integration has also maintained or even improved productivity and no-show rates in various locations.

Centralized systems aren’t a luxury— they’re your new foundation.

Fuel Your Growth
The smartest DSOs understand that the right tech stack doesn’t just accommodate growth—it fuels it. I hear the same message consistently: Centralized operations are not just beneficial—they’re essential. This centralization provides the clarity and consistency needed to make informed decisions, streamline processes, and ultimately drive scalable, sustainable growth across their entire DSO.

And the data bears that out. Our latest benchmarking report highlights top-performing DSOs, and the difference between the leaders who prioritize scalable, flexible tech ecosystems and the industry average is striking. Among other things, these leaders achieved:

This is the future we’re building: One where doctors are free to focus more on their patients and passion, not their systems, and DSOs can truly flourish. The momentum is real, the impact is growing, and we’re excited to be a part of it. Join us.

henryscheinone.com
833-210-7614

Chief Technology Officer Henry Schein One

Alan Rencher

Chief Technology Officer

Henry Schein One

Alan Rencher is a technology executive at Henry Schein One, an innovative technology company that provides industry-leading practice management, market, and patient engagement solutions. Previously, Alan worked in executive technology leadership roles at MasterControl, Target, Melaleuca, and various other technology companies. Alan enjoys solving complex problems with incredible tech and even better people. Alan holds various engineering and computer science degrees. Alan resides in Highland, Utah, with his wife and four children.

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C-Suite

3 Questions Every CEO Should Be Asking

03/06/2025

13 min. to read

Safeguarding the Modern DSO from Ongoing Cyber Threats

The dental industry is currently at a unique inflection point. There is increased demand for data, increased cybercrime, and ongoing privacy concerns, which together challenge practices — and their brands — like never before. The transition to digital has improved the ability to collect and process data and empowers dental practices to provide a better experience for their patients, employees, and partners. However, it has also created new vulnerabilities that can significantly impact EBITDA and the “brand trust” they work so hard to create.

Data has never been more important. The role of data — its quality and security — is instrumental to fueling technology, running operations, automating processes, enhancing experience, and improving decision-making. Data is, indeed, the linchpin for innovation in the industry.

Unfortunately, this data is of value to both your organization and to outside threats. Healthcare organizations store immense patient data, making them attractive targets for cybercriminals. Cyberattacks, data breaches, and ransomware represent real threats to your data and business. Ransomware attacks alone have tripled (246%) in volume over the past five years and top the list of biggest perceived security threats. Needless to say a breach can lead to severe financial and reputational damage to a DSO, regardless of size.

Gary Salman, CEO of Black Talon Security, emphasizes the importance of cybersecurity for DSOs. “Protecting your investments and critical patient data is paramount. Cybersecurity is not just about safeguarding sensitive information but also about preserving the trust and integrity that are fundamental to patient care. A robust cybersecurity strategy ensures that DSOs can operate securely and confidently in a landscape where data breaches and cyber threats are increasingly prevalent.”

The often uncomfortable conversations about cybersecurity can no longer be ignored. It is no longer just about meeting compliance, but it is about safeguarding the lifeblood of your organization and demands attention and engagement from the highest levels of corporate leadership. When it comes to cybersecurity, there are three big questions every C-Level leader should feel comfortable answering. Leaders, it is time to get informed of the risks and equip yourselves with the right questions and tactics to disarm cyber threats.

Effective cybersecurity is required for all businesses in the healthcare space. As a holding company, we need to be great partners and find and recommend great strategies for the 100+ small businesses who we are partnered with. The tools that my third-party security provider has deployed on our systems give me much greater visibility than I had before. I can actually track and keep a tally of attacks that were launched against some of our businesses. If even one of those attacks were successful, it would have cost our organization more money than we will ever spend on preventative security. That fact alone makes it easier for me to justify what I ask for when submitting my IT/security budget. I can emphatically state that I sleep better at night after partnering with a third-party cybersecurity provider.

– by Andy Taylor, Senior Director of IT for Dentive

What’s at risk if I don’t invest in cybersecurity?

Your patient’s financial and medical data is at risk.
Patient records, including personal and medical information, are among healthcare organizations’ most valuable assets. Healthcare data is attractive to cyber criminals because it contains financial and personal data, can be used for blackmail, is ideal for fraudulent billing, and is regulated by HIPPA law.

Your brand reputation is at risk.
Building a positive brand image is a gradual task that takes years. Within days, a cybersecurity breach can undo brand perception, severely damage an organization’s reputation, and erode patient trust. While security starts with internal commitments and discipline, to the outside world, security plays a significant role in achieving customer satisfaction — infusing trust into each interaction with your brand.

You risk regulatory fines and legal action.
With the increasing number of data privacy regulations, compliance has become a significant concern for all healthcare leaders. Implementing a strong cybersecurity strategy is not only a best practice but also a legal necessity to avoid the possibility of hefty fines and legal repercussions.

You risk significant financial loss.
Cyberattacks can have devastating financial consequences. The impact ranges from large ransom payments and business disruption to costs for remediation, legal fees, possible regulatory fines, and potential class action lawsuits. Revenue cycle is impacted often creating difficulty making payroll and paying expenses. A 2020 estimate from IBM placed the average monetary cost of a data breach in a company with fewer than 500 employees at $2.64 million.

CASE STUDY

A hard-hitting example of what’s at risk:

In mid-October 2023, a multi-specialty DSO with 15 locations running a Cloud-based EMR system was the victim of a significant ransomware attack.

The first indications of the event were ransom notes and encrypted files on almost all of their 400+ computers, which employees discovered upon arriving at their desks. Internal IT was immediately contacted, and the ransom notes and encrypted files were quickly confirmed as real. The hackers accessed their data and downloaded patient records via workstations within the DSO. The hackers also installed screen-sharing applications on the computers, providing them persistent access to the network.

After a week, a difficult recovery process began. Since each machine was impacted, all workstations and servers needed to be rebuilt from scratch. The rebuilding process took two weeks due to the size of the organization.

The ransom demand was more than $2,000,000, and the hackers provided a detailed list of all the patient records and files they stole. The DSO chose to negotiate and pay the ransom in order to get the decryption code to unlock their data. This also mitigated the chances of the hackers publishing and selling the stolen patient and operational data. The hackers agreed to accept $1,400,000, utilizing Bitcoin (BTC).

After four weeks, the DSO had exhausted its $3,000,000 cyber insurance policy. It was paying out of pocket an average of $250,000 per day for mitigation and recovery while generating $0 in revenue due to closed offices. This DSO experienced a total loss of over $5,000,000 from
operational outages due to the inability to see and treat patients, collect accounts receivable, office closures, legal fees, restoration expenses, and the ransom payment.

The IT department was not necessarily negligent; they were simply unaware of the sophistication of modern-day ransomware attacks and missed critical components of a robust security stack. A comprehensive offensive and defensive security stack could have prevented the intrusion and exploitation of the network.

This real-life example is not an outlier. Unfortunately, it is all too typical. Operational shutdown is a likely and immediate consequence for DSOs with more than five locations — lasting 7-10 business days. Generally, every workstation and server are impacted and requires a replacement or rebuild. Also, nearly all healthcare breaches involve patient data theft which requires forensic investigation. Painfully, no data can be moved or accessed until the investigation concludes. Engaging a cybersecurity firm for threat negotiations and forensic investigation is crucial and expensive. Ransoms for large dental organizations start at around $1 million.

Beyond the immediate aftermath, recovery is lengthy and expensive. DSOs can potentially be required to notify patients of the breach, offer ID monitoring, be subject to compliance fines, and possibly class-action lawsuits due to data theft and exposure. Often, the reputational harm of the events presents PR nightmares and the possibility of patient attrition when not handled properly.

Are we equipped to handle a cyberattack?

As a C-suite executive, you may not be a cybersecurity expert but it’s crucial for you to understand your organization’s cybersecurity
posture and potential vulnerabilities. To ensure that your organization is adequately protected, begin by asking your IT resources the following questions:

Where is our organization most vulnerable to cyberattacks?
When was our last vulnerability scan and what action was taken with these results?
Do we have continuous, 24/7/365 monitoring of our network and data?
Do we have a complete inventory of our data locations and the assurance that it is protected everywhere?
What is the status of our cybersecurity awareness training at all levels of the organization?
When was our last third-party security risk assessment conducted?
Do we have a comprehensive response plan and protocol for handling a cyber intrusion?
When was our last penetration test performed?
Do we have a data map showing where all our data is stored?
Do we have KPIs and Business Intelligence showing us trends in our security risk?

The answers to these questions will provide valuable insights into your organization’s security posture and help to highlight areas that may require immediate attention.

After our IT provider fell victim to a ransomware attack across all of our dental locations in Maryland, we turned to Black Talon on our insurance company’s recommendation. Their team was not only able to negotiate the ransom down by 25% but also managed the entire decryption process swiftly and effectively. Throughout the ordeal, they communicated clearly and patiently, guiding us through each step in a way that was easy to understand, even for someone not versed in IT. Their professionalism and support were invaluable during what was undoubtedly the biggest crisis of my 20-year career. I highly recommend Black Talon for their expertise, prompt response, and unwavering dedication.

– by Dr. T

What is our approach to preventing security threats?

Consult with experts and take a proactive, data-driven approach to prepare for the unexpected. An excellent place to start is a conversation with your IT resources and cybersecurity provider to assess gaps, prioritize focus areas, and implement changes accordingly. Meanwhile, there are also several proactive steps to consider. Start on these sooner rather than later.

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It’s essential to distinguish the difference between IT resources and dedicated cybersecurity firms. IT companies concentrate on managing and maintaining your overall infrastructure, which includes tasks like managing firewalls, traditional antivirus protection, maintaining hardware, software updates, and backups. In contrast, cybersecurity companies go beyond traditional IT measures and specialize in safeguarding your data against threats and breaches. They employ highly credentialed security engineers who utilize advanced security measures such as intrusion detection, encryption, and conduct regular security audits, penetration testing, and vulnerability assessments to ensure comprehensive protection.

Empower employees
Foster a security-conscious culture within the organization where every employee understands their role in protecting its information assets. Educate them on the latest cybersecurity threats and train them to thwart cyber risks, social engineering, and other common threats. Conduct regular simulated security and phishing tests to reinforce this training measure performance.

Conduct vulnerability scans
Exploiting technical vulnerabilities is the second most common way hackers successfully target healthcare organizations. Vulnerability scans are a way to be aware of your wide-open “doors and windows” on your network before a hacker finds them. Using continuous vulnerability scanning tools helps identify weaknesses before hackers can exploit them. Vulnerability scans should be performed daily against your entire IT infrastructure, including all workstations, servers, and firewalls.

Implement advanced XDR and MDR anti-virus technology
Traditional anti-virus (AV) software has been a great tool for the past 30 years to defend organizations; however, it is not designed to protect DSOs from modern-day cyberattacks. Criminal groups that target healthcare organizations are well-funded, sophisticated, tech-savvy gangs of cyber criminals. They own most of the AV programs on the market and know how to re-engineer their malicious code to become invisible to traditional AV.

Upgrading your defense to Extended Detection and Response (XDR), or Managed Detection and Response (MDR) can significantly increase your chances of fending off an attack. XDR and MDR uses advanced analytics, machine learning algorithms and threat intelligence feeds to detect and prioritize security threats, isolate endpoints and notify who is responsible for network monitoring. An effective MDR solution should include 24/7 monitoring by a human security professional.

Conduct security risk assessments (SRAs)
Engage with a third-party expert to perform a SRA against your DSO. This assessment should involve a thorough analysis of your organization’s security posture, including identifying threats, vulnerabilities, operational risks, and lack of controls and SOPs. The third-party will provide you with a risk register, how to prioritize risks based on their potential impact, and recommend appropriate mitigation strategies and controls to address the identified risks. Commit to annual assessments and consider increasing their frequency after major changes such as mergers, technology integrations, and changes in the threat landscape. It’s especially crucial during the due diligence process to complete a comprehensive SRA before proceeding with an acquisition, as you don’t want to inherit any security breaches (or “buy a breach”).

Develop an incident response plan
The time to plan for a cyber incident is not in the middle of the crisis. It is critical to have a plan in place before an incident occurs. Develop a detailed incident response plan highlighting the steps for detecting, responding to, and recovering from different types of cyberattacks. Ensure that everyone in your organization is aware of their roles and responsibilities during a security incident.

Commit to implementing and validating
Once you’ve committed to implementing these top strategies, develop a way to track and verify that the money you are spending for protection is being used effectively. Modern security professionals are looking at ways of reducing redundant toolsets, increasing visibility into their blind spots and monitoring from a “single pane of glass.”

Develop security metrics
Security metrics allow you to base decisions on actionable data. Executive teams often make cyber decisions based upon “feelings” instead of developing a way to quantify risks and impacts. Cyber resilient DSOs monitor and track:

Real-time security metrics through actionable dashboards that ingest data from all your computers, servers, firewalls, anti-virus, and people. This provides organizations with a clear picture of where you have security risks so you can either accept or remediate them.
Current and historical data so leadership can ensure their IT and cybersecurity investments produce results.
A cybersecurity risk score based on vulnerabilities from computers and firewalls, threats stopped, cybersecurity training, simulated phishing, open ports on firewalls, and more. This risk score helps non-technical leaders grasp the overall risk and helps them align budgets to address it or ask more follow-up questions.

Today’s prevention secures tomorrow’s future
As stewards of the organization, executives set the tone for their organization to follow. Incorporate cybersecurity and risk management into your strategic planning. The outlook may seem bleak, but attacks are preventable. Implementing robust preventative measures will significantly reduce your risk. In these changing times, reevaluate your cybersecurity strategy to safeguard your revenue cycle, EBITDA, and growth plans against the consequences of inaction or outdated security practices.

This article is sponsored by Black Talon Security, the recognized cybersecurity leader in the dental/DSO industry. With deep roots within the dental and dental specialty segments, Black Talon understands the unique needs that DSOs and dental groups have when it comes to securing patient and other sensitive data from hackers. Black Talon’s mission is to protect all businesses from the devastating effects caused by cyberattacks—and that begins with a robust cyber risk mitigation strategy.

To evaluate your group’s current security posture visit www.blacktalonsecurity.com.

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State of the Dental Industry

07/08/2024

6 min. to read

2024 Mid-Year Perspective

By Brian A. Colao
Director, DSO Industry Group at Dykema

The last five years have brought monumental change to the dental industry. It can be persuasively argued that there has been more change in the last five years than in the previous 100 years of the dental industry.

The Great Lockdown
In March of 2020, for the first time in modern history, the government told patients that they could not go to the dentist, and dental offices across the country and throughout the world were shut down for all but emergency cases. It was a tremendous mistake by our elected officials to declare dentistry “non-essential”, and society paid a significant cost for that mistake. Patients were denied essential treatment, dentists were deprived of their livelihood, with little to no benefit to society. It was an unnecessary disaster.

The Great Reopening
Around the summer of 2020 and continuing throughout the year, dental offices were allowed by state governments to reopen on the largest scale in the history of dentistry. Reopening so many offices so quickly presented a number of challenges, including shortages of PPE, staff shortages, staff reluctance to return to work, dentist reluctance to return to work, and patient fear and reluctance to resume treatment.

The Great Recovery
Starting in the summer of 2020, dental offices across the country began recovering their revenue, but it was not an even recovery, and some organizations struggled while others thrived, and still, others experienced everything in between. A divide began to develop where some organizations were able to successfully navigate the post-lockdown challenges, while others were much less successful. Unsurprisingly, the organizations that succeeded in the post-pandemic environment became much more valuable than the organizations that struggled.

The Great Resignation
During the Great Reopening, it quickly became apparent that the post-pandemic labor market was very different from what it was pre-pandemic. The unintended impact of the government aid programs and government lockdown programs led many dental staff members to elect not to return to work, choose other professions, or return to work with costly and often unreasonable demands for their continued employment. This has created one of the most expensive labor markets in the history of dentistry.

The Great Inflation
Beginning in 2022, as a result of government aid programs flooding the economy with largely unnecessary dollars, coupled with numerous geopolitical forces, inflation soared to its highest rate in decades. This caused interest rates to skyrocket in a very short period of time, the cost of goods to increase significantly, and the buying power of money to be greatly reduced.

The Great Uncertainty

The Great Inflation has created a very challenging economic condition.

Historically High Cost of Labor + Historically High Cost of Goods + Historically High Interest Rates = Historically High Pressure on EBITDA and reduced dental organization valuations.

Despite repeated efforts by the Federal government, interest rates remain stubbornly high, and there are now additional global conflicts that threaten to destabilize financial markets. There is also considerable uncertainty as to who will win the upcoming presidential elections. All of this has led to uncertain market conditions and no clear date in sight for when things might improve. This has created Great Uncertainty, with many organizations suspending M&A activity, cutting costs, reducing their workforce, and holding off on capital expenditures.

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The State of the Evolution of Dentistry

Pre-pandemic, the dental industry was evolving from dentist-owned solo offices and dentist-owned group practices to DSO affiliations at an unprecedented pace. The market stood at just under 30% consolidation prior to the pandemic. The Great Inflation and Great Uncertainty have considerably slowed down the consolidation market. Many DSO buyers remain “pencils down” or greatly constrained in the number of acquisitions they can complete in 2024. In addition, the large DSO transactions that received great fanfare and attention over the last five years have almost ground to a complete halt.

While the market has slightly improved in the second quarter of 2024 with numerous small to midsize deals occurring, the historically high interest rates will need to come down, or the conventional PE-backed DSO model will need to be restructured for deal activity to reach the 2018-2021 levels.

The outcome of the upcoming presidential election will undoubtedly have a significant impact on the M&A markets as the candidates have very different approaches to the economy. For now, the evolution of dentistry is proceeding at a much slower pace until at least the conclusion of the upcoming presidential election.

The current challenges of the M&A markets have caused dental organizations to aggressively focus on same-store growth.

The State of Growth in Dentistry

The required formula for growth in the current dental marketplace as shown in the below figure:

Growth MUST equal added value to an organization

Added value equals increased EBITDA
Growth without added EBITDA equals negative value
Growth with added EBITDA equals value
If you can’t ADD value, you shouldn’t grow your organization

In short, any acquisition or de novo contemplated by a dental organization must increase the organization’s EBITDA, or it should not be undertaken. The current challenges of the M&A markets have caused dental organizations to aggressively focus on same-store growth. There have been incredible innovations over the last five years that can significantly increase same-store growth.

The State of Innovation in Dentistry

There have been more innovations in dentistry in the last five years than in the previous hundred years. This is one of the most exciting times in history to be in the dental industry. The following innovations have been truly game-changing for same-store growth.

The Future Outlook of Dentistry

The Great Evolution and consolidation of dentistry will continue. In the next 10-15 years, the rate of consolidation will increase from 30% to around 80%. The industry will likely consolidate from several thousand organizations to a hundred or so at which time, there will be a second consolidation which will, before it is concluded, test the limits of the anti-trust regulations. The conventional PE-backed DSO model will be the dominant model in dentistry. A few large DSOs may become public companies. Those organizations that adopt technology will have a distinct advantage because technology can overcome labor costs and shortages, as well as the impending shortage of dentists and specialists.

One key to alleviating the shortage of dentists and specialists could be lowering the hurdles for foreign dentists to become licensed in the United States, and this is a trend that should be watched very closely. It is also likely that regulators will continue to impose requirements and hurdles to the consolidation once it reaches a much larger scale. The sky’s the limit as to what AI and other dental technological innovations can accomplish and the next five years will be even more exciting than the previous five from the standpoint of innovation.

The industry leading DSO group at Dykema stands ready to assist dental organizations navigate the challenges and complexities of the existing marketplace.

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The Staffing Conundrum: Why Now?

The New Growth Equation: Retention + Quality + Optimization

The Rise of DSOs

Passion for Dental Care

Financial Growth and Business Acumen

“Navigating the complexities of running a DSO requires more than basic business understanding of dental practice operations and clinical expertise.”

Building a Positive Organizational Culture

Retaining Dentists

“A DSO’s true customer is its affiliated dentists.”

Conclusion

How Truth and Trust Drive Organizational Success

The Foundation of Organizational Culture: The People

The Continuity of Culture: Shared Purpose

Trust: The Bedrock of Momentum

Tips for Building Trust

The Path to Innovation: Structure and Flexibility

A Culture of Accountability and Adaptability

Building a Strong Team: The BHAGs

Conclusion: Lead Through Truth and Trust

What’s Real, What’s Coming, and What to Do About It

Common AI technology applications available today:

How to Integrate AI Into Your Practice

2024 2nd and 3rd Quarter DSO Industry Update

You are what you think

Your Tech Stack, Unstacked

Safeguarding the Modern DSO from Ongoing Cyber Threats

What’s at risk if I don’t invest in cybersecurity?

A hard-hitting example of what’s at risk:

Are we equipped to handle a cyberattack?

What is our approach to preventing security threats?

The Great Uncertainty

The State of the Evolution of Dentistry

The State of Growth in Dentistry

The State of Innovation in Dentistry

The Future Outlook of Dentistry

“Navigating the
complexities of
running a DSO
requires more than
basic business
understanding of
dental practice
operations and
clinical expertise.”

“A DSO’s true
customer is its
affiliated dentists.”