Wednesday, February 20, 2013

How Much Do Associate Dentists Make?

Just as there is more to life than money, there is more to a job than income. Like it or not, though, income is one of the primary motivators for job seekers. So what is realistic for an associate to make?

As recruiting consultants, we have interviewed thousands of dentists- more than 1,800 in 2012 alone. Using the information gathered from those interviews we were able to identify some general trends and averages for dentists who are either active job seekers or who are keeping an ear open for better opportunities. This is not a scientific analysis by any means. Results including self-reported income levels are inherently suspect, but we have done our best to take into account actual income based on reported production in addition to the responses of applicants.

In order to make the information more meaningful, I grouped our responses into three categories. "Early Career Dentists" includes doctors with less than five years of experience. "Mid-Career Dentists" have between five and fifteen years of experience. "Established Dentists" have more than fifteen years of experience and generally represent dentists who have either owned a practice and returned to the workforce, or who have opted for a career outside of ownership.

Average Associate Dentist income across all experience levels: $149,000 annually
Average Early Career Associate Dentist income: $135,000 annually
Average Mid-Career Associate Dentist income: $154,000 annually
Average Established Associate Dentist income: $163,000 annually

There are many factors that affect income. Practice type, location, patient load, and associate experience are all very important. Dental Economics and the Levin Group collaborate to put out an annual survey that includes a break down of the difference in income between different community types. You will see that the highest income potential is often not in the major cities but in the secondary markets, where there is less competition for patients, but where the local economy and population are sufficiently diverse to support a thriving private practice.

Note: The first number is the median and the second is the mean.

You can download the full survey results along with analysis at the Levin Group website:

For additional information on local income trends, contact the ETS Dental Recruiting consultant specializing in your area. A list of our recruiting consultants and their areas of focus can be found here:

Contributed by Morgan Pace, Senior Dentist Recruiter for ETS Dental, | | 540-591-9102

Friday, February 15, 2013

The Independent Contractor Status Draws Scrutiny in Dental Practices

This great article was written and shared by Dental CPAs. Check them out at their website:
The government does not hold any grudges against independent contractors. Employers who attempt to avoid paying employment taxes by falsely classifying employees as independent contractors are another story. The government doesn’t like anyone who evades paying taxes.

Independent contractors are valid in various industries given the proper circumstances, including dentistry. However, the government has and will continue to look for abuses of the classification where employers attempt to evade employment taxes.

People who wish to be considered independent contractors (IC) should arrange their circumstances so that their case as an IC is defensible. Some of these circumstances may include: being able to perform work duties freely in the facilities of the owner, getting paid by the project or service (not hourly), paying for their own materials or supplies, using their own equipment, hiring and paying their own staff and control the result of their product or service. If these circumstances are not in place with the owner of the business, the general IC may not be an IC at all, they may be an employee.

One of our client’s is a dental specialist. They don’t own their own practice, they work in offices of other practitioners. They bring their own staff, they control their work process and the outcomes, their services are billed separately, they decide the days they work and because they’re a specialist, the owner can’t supervise their work (tell them how to do it). They also operate from their own entity so the contract is between two entities, an individual is not involved, other than the person providing the service.

Businesses must weigh the degree of the behavioral and financial relationships with workers when classifying them.

The consequences for the owner who misclassifies an employee as an independent contractor could be: A. they’re assessed the employer’s portion of the social security and Medicare tax, B. federal unemployment tax, and, if the owner cannot prove the independent contractor reported the income on their return, they may also assess the employee’s portion of social security and Medicare tax, plus penalties and interest. If the owner had any employee benefit plans that should have covered the IC (health and retirement plans), there could be negative consequences there as well.

If you are an independent contractor, you are self-employed. To find out what your tax obligations are, visit the Self-Employed Tax Center on the IRS website.

You are not an independent contractor if you perform services that can be controlled by the owner (what will be done and how it will be done), you use the owner’s equipment and supplies, you service the owner’s patients or clients and they tell you when to work. This applies even if you are given freedom of action. What matters is that the owner has the right to control the details of how the services are performed. For example, a general dentist is working for another general dentist as an associate, the associate uses the dental staff, they are being supervised by the owner, they are told the hours they are working, they use the owner’s equipment and supplies, and this is the only office they work for. This associate would likely be classified as an employee.

If an employer-employee relationship exists (regardless of what the relationship is called), you are not an independent contractor.

This is a serious issue for owners who are either intentionally or unintentionally misrepresenting relationships with workers. In cases of abuses, the owner is the party that will likely take the beating.
I recall back in the late 80's when I had a stock broker tax client where all the brokers of this small firm were being treated as independent contractors. The IRS audited the brokerage for several years for the very issue being discussed. The brokers had to submit returns to prove that they were reporting their income correctly and paying the Self-Employment tax while the brokerage firm got slammed for hundreds of thousands of back payroll taxes, penalties, and interest. Ultimately, the brokerage went belly up, many people became unemployed and many clients had to find new brokers or move their money to the brokerage where their broker landed.

We've had similar stories on a much smaller scale where IRS reclassified independent contractors as employees and made the client pay back payroll taxes, interest, and penalties. I have only heard of one case where the independent contractor themselves got audited and reclassified as an employee and they got hammered income tax wise because schedule C expenses became miscellaneous itemized deductions subject to limits and their self-employed retirement plan deduction got thrown out.

The bottom line is in just about every audit of a business, one issue the agent must take a look at is the employee vs. independent contractor issue to ensure employers aren't trying to evade employment taxes.

Thanks again for allowing us to share your article, Dental CPAs!

Thursday, February 7, 2013

Dentists Must Work Harder AND Smarter

How is your 2013 starting off? Here at ETS Dental we are talking to a lot of practice owners and groups who are excited about the new year. With that excitement there is still a lot of cautious optimism, along with some worry and concern regarding external environmental factors such as the full effects of the Affordable Care Act, new taxes, and the continuing economic recovery.

Dental Economics/Levin Group 2012 Annual Practice Survey shows us that we are still climbing out of this recession, but there were some improvements. For their detailed report visit

There was a very important statement made in the survey report:
It is notable that 67% of dentists report that inefficient practice systems are their biggest challenge right now. That number has doubled from just a year ago. More dentists realize that, in order to succeed in the new dental economy, practices must be operated as excellent businesses. This means implementing innovative systems that will increase production and profitability by addressing current economic challenges.
Practices must now address their operations and spending in a way they never have before. It is not as simple as just increasing production by marketing more or signing up with more and more insurance plans. Practices must take a look at the whole business and make smart business decisions. 

Gone are the days of just simply hanging your shingle and having a successful dental career.

Written by Carl Guthrie, Western Regional Search Consultant of ETS Dental. Contact Carl at | 540-491-9104 | www.linkedin/in/cguthrie 

Friday, February 1, 2013

Recruiters See an Increasingly Candidate-Driven Market as Offer Turn-downs Rise

“The only reason the [talent market] is candidate-driven is because the candidate pool is very weak of the top performing individuals. Companies want the ‘Superstars’ today. Average employees are not being hired,” said a recruiter responding to the most recent MRINetwork Recruiter Sentiment Study. According to the report, in the first half of 2013, 68 percent of recruiters characterized today’s labor market as candidate-driven, up 12 points from a year ago. Strikingly, it has become not uncommon for LinkedIn profiles to tell would-be employers to go knock on someone else’s door.

“It’s a candidate-driven market [for those with] specialized skills and [who] are viewed as on the way up in their career,” said another MRINetwork recruiter. “It’s an [employer]-driven market for commodity positions.”

While experienced professionals at the top of their game are, almost by definition, few and far between, some recruiters noted a new trend emerging. For example, early career professionals, those with one to five years of experience, are becoming increasingly difficult to find. The reason isn’t hard to figure out. Since many employers have held back on filling entry-level positions for the last five years, fewer people have had the opportunity to start their careers over that time. The unemployment rate for those between the ages of 20 and 24 years old is 13.7 percent, nearly double the rate of those 25 to 54 years old (6.7 percent).

One survey respondent went so far as to say that, “Employers can expect a candidate-driven market for the next ten years due to the shortage of existing accomplished talent.” Perhaps the clearest indication of the candidate-driven market is the growing prevalence of candidates not just leaving their existing jobs, but turning down job offers.

As one recruiter noted, “Hiring is always buying and selling for all parties. [Employers] need to be reminded sometimes that it is equally as important to vet a strong candidate as it is to sell them on, ‘Why us.’” Today, top candidates have other opportunities that they are either actively pursuing or know they could pursue.

According to the study, of candidates who rejected offers during the last half of 2012, one-third accepted another job offer while 18 percent accepted a counteroffer. In 2012, counteroffers appeared to grow in frequency and veracity, possibly because hiring authorities, growing wise to the difficulty of finding top talent in this marketplace, opt to provide generous counteroffers rather than risk starting with someone new.

“Recently, we have had candidates receiving counteroffers. We are dealing with top prospects here, but only lately have [they appeared] good enough to be accepted. Prior to Q4 [2012], we hadn’t seen a counteroffer worth accepting in four years. That has changed now,” said one respondent.

The results from this study clearly do not represent the employment market at large, but rather the management and professional segment of the talent market for which MRINetwork recruiters are normally sought after to find top talent. However, even with the economy growing at a snail’s pace, the competition for this level of talent appears to be growing as the availability continues to diminish.