Associate Dentist Jobs - Understanding the Numbers When Comparing Multiple Job Offers

It is always great to have options, but how does one job offer compare to another? We covered the typically negotiable elements of a job offer previously (read that blog post here). The purpose of this week’s blog is to share the observation that many dentists are leaving money on the table in search of a higher percentage.
Why not accept the bigger offer?
At the end of the day, a higher percentage of lesser production will often result in less income with a slower path to increased production.
My email contact list is filled with dentists who are financially dissatisfied yet unwilling to make a move because they would need to take a commission cut. While not always the case, there is a definite trend with the offices where these doctors are working. These offices typically:

• Have not invested in modernization . They have older equipment and office systems
  
• Have no marketing budget and get few new patients. They are long established patient bases that gradually grew to the point where the owner had more patients than he or she could comfortably treat.
  
• Are not well situated. They are typically located in old building removed from the busier, higher rent part of town.
  

As a result, the practices had very low overhead expenses and could offer the associates a higher percentage. They also tend to be slower, less progressive and charge lower-than-average fees.
Associates in offices like this will make significantly less income on a higher percentage than their busier colleagues working for a smaller percentage in offices with higher overhead but a more progressive clinical and business approach.
Why wouldn’t a more successful office offer a higher percentage?
These offices are reinvesting in the practices and have lower per-procedure profit margins.
While associates are often tempted to conclude that the business’ overhead is not their concern, it is wiser to consider the bigger picture. By investing in the practice, these owners are providing a better environment for the associate to thrive. The associate can more easily provide a higher level of care using better facilities. In addition, the associate can more easily operate efficiently using better office systems and will have more opportunities for treatment in an office with a greater number of new patients.
How big a difference does this make in associate compensation?

Daily Production	Annual income at 27%	Annual income at 30%	Annual income at 33%
$2,000	$108,000	$120,000	$132,000
$2,500	$135,000	$150,000	$165,000
$3,000	$162,000	$180,000	$198,000

As you can see, a small increase in daily production has a much larger impact on income than commission percentage
What should a potential associate look for when determining the income potential of an office?

• Procedural Mix
  
• New Patient Numbers
  
• Scheduling procedures
  
• Hygiene production
  
• What procedures are being referred out of the office
  
• Office equipment (business and clinical)
  

Other resources on associate dentist job offers:

• Is your offer reasonable?
  
• What do associates earn?
  
• Negotiating an offer
  
• What to know before you accept a position
  
• Comparing Offers
  
  
  Written by Morgan Pace, Vice President and Senior Account Executive/Dental Recruiter at ETS Dental (www.etsdental.com). For more information, contact Morgan directly at 540-491-9102 or mpace@etsdental.com
  

What Can an Associate Dentist Earn in Different Parts of the United States?

Last year we ran an article about how much Associate Dentists make across the United States.  The data provided was from the Dental Economics Annual Practice Survey.  This week I took an informal poll of our recruiters to learn about the current trends in compensation structures across various regions of the United States

Very important to note the following:

• Most of our experience is with private or local group practices
• These compensation averages are based on what we typically see in the market place, so what you may see or hear could potentially be higher or lower. 
• Income based on percentages is relative to what will be produced/collected, so it is not necessarily fair to compare offers solely based on the percentage paid
• The more saturated an area, the lower the percentages and average income will typically be for a doctor. However, this is not a universal fact, just likelihood.
• These numbers were based on doctors with 1 to 5 years of experience
• We understand the ever-present debate of collections versus production.  What we see is greater than 4 out of 5 practices pay on a collections-based system.
• We are only talking about Associate Dentists’ income levels.  Not all dentists.  Owners absolutely make more income.  For example, Department of Labor statistics will be significantly higher than what is listed below. 

General Average of Doctors with 1 to 5 years of clinical experience

Location	Total Annual Compensation	Percentage of Collections/Production	Base minimum or guaranteed salary	Other points of note
New England and North East U.S.	$130,000	35% of collections	$500/day	Lab expense of 35-50%
South Eastern  and Mid-Atlantic U.S.	$130,000	30-33% of collections	$110,000 to $120,000 per year; $500/day	Equivalent lab percentage
Midwest and Great Lakes	$130,000 to $140,000	30-33% of collections	$120,000 per year; $500/day	Equivalent lab percentage up to 50%
Great Plains and Rockies	$130,000 to $150,000	30% of collections	$500/day; $120,000/year	If a practice charges lab it will be equivalent to percentage up to 50%
Texas / Oklahoma / New Mexico	$130,000 to $150,000	25-30% of collections	$500-$600/day; $120,000 to $130,000 per year	Rarely seeing any lab fee charged to the associate in recent years
Western Seaboard	$120,000	25-30% of collections	$400 to $500 per day	50/50 chance the practice charges any amount of lab to the doctor. If they do it is equivalent up to 50%.
Multi-state and National Dental organizations do vary from some of the above, but only in some ways.  Overall, they offer a strong base salary in the area of $120,000 to $145,000 per year, depending on experience.  They pay a percentage of collections/productions that ranges from 25% to 33%.  Some pay the same percentage regardless of the level of production, while others will offer a tiered scale that increases the paid percentage for levels of production/collections that are met.  For example: up to $40,000 = 25%; $40,001 to $50,000 = 27%...  These organizations more often than not offer a full complement of benefits such as 401k, malpractice, medical insurance, CE, etc.

Overall, what you see here is fairly similar earning amounts across the country.  However, the way doctors are paid varies from the Northeast over to the Northwest.  Something to consider when you are looking for your next practice opportunity.

Posted by Carl Guthrie, Senior Dentist Recruitment Consultant with ETS Dental. To find out more, call Carl at (540) 491-9104 or email at cguthrie@etsdental.com.