Los Angeles MSO and DSO Attorneys

While most states, understandably, do not let anyone who is not a dentist own a dental practice, they do let companies offer support services to licensed dentists for a reasonable fee. To accomplish this, many professionals choose to form Dental Support Organizations (DSOs) or Management Service Organizations (MSOs). DSOs and MSOs handle the business aspects of the practice, allowing dental professionals to focus on patient care. 

This somewhat new concept has resulted in an influx of private investors into the dental business, prompting numerous ethical and legal questions for dental professionals as well as their patients. For this reason, it is essential that a comprehensive agreement is in place that addresses a wide variety of issues that could potentially arise. Working with a knowledgeable legal team can help to ensure you thoroughly understand your rights and responsibilities moving forward.

The business attorneys at Leiva Law Firm have decades of experience successfully representing dental professionals across Southern California with the development and operation of DSOs and MSOs. Our legal team seeks to form management companies that adhere to multiple state regulations. We have assisted some of the state’s largest DSOs with providing reliable services to dental professionals throughout the United States while keeping to the confines of state laws that govern the practice and operations of the dental field. 

If you are looking to establish an MSO or a DSO, or you have legal questions pertaining to these organizations, contact our law firm to schedule a consultation with our skilled MSO and DSO lawyers in Los Angeles.

What are Dental Services Organizations?

Dental Service Organizations and Management Service Organizations provide management services and own the assets of a practice. They have no control over patient care. In California, a non-dentist is prohibited from owning a dental practice, so a DSO will establish a company to pay dentists’ salaries. The company will set up a service contract with the DSO that owns the practice and collect its earnings.

DSOs began to appear in the late 1980s as a new business model for dentistry. Its increasing popularity is ascribed to growing student loan debt among new dentists, declining or flat practice revenues, and the financial effectiveness of DSOs that reap the benefits of large purchasing power. Also accumulating favor is the number of young dental professionals who choose to get their salary from a dental practice rather than to have a stake in the ownership of the practice. In a partnership or solo practice, dentists only spend about 60% of their time treating patients. Under the DSO format, that number jumps to 90% because dentists are no longer responsible for any administrative duties.

Since California law prevents a dental service organization from participating in certain activities, those that are closely associated with the practice of professional dentistry are only conducted by licensed dentists within the practice. In other words, dentists and DSOs divvy up the responsibilities.

Generally speaking, a dentist is responsible for numerous clinical activities such as:

• The supervising and training of new dental professionals
• The firing and hiring of dental professionals 
• The evaluation, diagnosis, and treatment of patients
• The storage, maintenance, and indexing of patient treatment records
• Providing patients with quality dental services
• Obeying all clinical protocols

In addition to these, DSOs also deal with the majority of general business practices. Some responsibilities shouldered by DSOs are:

• Marketing the practice
• Managing the practice’s IT infrastructure and other information technology 
• Overseeing all financial operations such as tax preparations, payroll, accounting, collections, and billing 
• General office management duties
• Conducting human resource tasks except those that involve the firing and hiring of dental professionals
• Risk management
• Ensuring regulatory and legal compliance

Keep in mind that California does not dissuade dentists from taking responsibility for an administrative job. Doing so might, however, be strictly forbidden under a particular DSO agreement. Working with a knowledgeable Los Angeles MSO and DSO attorney can help ensure that you understand your rights and responsibilities as your practice grows. 

The Benefits of DSOs for Dentists

• Consolidated Practice Support: DSOs supply a variety of non-clinical assets and services to dental professionals, simplifying the daily operation of their dental practice. These services typically include supply procurement, facility maintenance, compliance, human resources, marketing, and accounting services.
• State-of-the-Art Technology: A combination of ongoing research and development, available capital, and purchasing leverage, DSOs make it possible for dental practices to enjoy cutting-edge products and tools, like CAD/CAM systems, electronic health records, and digital X-rays.
• Professional Training and Education: Most DSOs provide ongoing education programs taught by skilled dental mentors, making it possible for dentists to stay up-to-date on equipment, new protocols, techniques, and practice management tools.
• Economies of Scale: The ability to negotiate with vendors combined with greater purchasing power helps DSOs keep dentists’ supply costs low. DSOs also provide access to the capital dental professionals need to ensure they have the most modern tools and equipment, and the support they need for their practices.

The Benefits of DSOs for Patients

• More One-on-One Time With the Dentist: By cutting down on the amount of time that dentists spend handling the administrative parts of running a practice, DSOs allow them to dedicate more of their time to treating and caring for patients.
• Increased Scheduling Flexibility: DSOs also make it possible for dental practices to take more appointments and offer extended office hours, including evenings and weekends, to accommodate their patients’ busy schedules.
• Access to Advanced Dental Care: Dental practices supported by DSOs have access to advanced technology, including same-day restorations and digital X-ray systems, which improves the quality of care and offers a more satisfactory patient experience.
• Affordable Dental Care: A DSO’s purchasing power allows dentists to accept more insurance plans and provide higher quality services that patients value and can actually afford.

Services Our Law Firm Offers 

Leiva Law Firm offers a range of services designed to ensure you are positioned for success with the establishment and functionality of your DSO. Our legal team is abreast of all California state laws governing dental practice operations. We are available to help dental practices that have been subjected to unlawful fee-splitting and other associated regulations. Our firm specializes in advocating for DSOs throughout Southern California in areas such as: 

• Developing and founding regulatory compliance business models
• Ensuring ongoing compliance on a spectrum of problems specific to the field of dentistry 
• Defending Dental Support Organizations on a variety of issues surrounding regulatory actions and litigation
• Acquiring real estate for your dental practice
• Private equity transactions
• Ensuring employment and labor benchmarks are met
• Protecting intellectual property
• HIPAA compliance
• Guaranteeing any privacy concerns are addressed 
• Ensuring compliance with healthcare regulations 
• Providing assistance during government investigations
• Creating and expanding MSOs and DSOs
• Advocating for dental professionals against California State Board Investigations Complaints as well as in private legal matters with affiliated dentists and physicians
• Helping private equity investors buy, sell, and invest in DSOs 

No matter if you are a non-dentist who wants to get involved in the business aspects of the dental industry, or you are a retiring dentist who is interested in continuing to work on the business elements of the practice, our firm can supply you with the services you need to successfully establish a new DSO or MSO. Our attorneys strive to ensure your DSO or MSO complies with all state regulations and laws, provides substantial profit margins, and properly compensates your dental professionals.  

MSO and DSO Clients We Work With

The MSO and DSO attorneys at Leiva Law Firm are extremely knowledgeable about the development of these businesses. This understanding has been acquired through decades of experience helping people with different backgrounds join together to form and operate DSOs and MSOs. 

Some of the people we work with on a daily basis are:

• Private equity investors
• Other investors
• Large Dental Service Organizations
• Mobile dental service providers
• Dental practices
• Dental practice management companies
• Dental professionals with their own practice

There tend to be a variety of different professionals interested in the establishment, ownership, and management of a dental practice. With that in mind, we offer personalized representation for every client to ensure their individual goals are reached. 

What is Included in a DSO Agreement?

One of the most difficult decisions a dentist will have to make is whether they are going to work with a DSO or build their own private practice. Like anything else, working with a DSO comes with both advantages and disadvantages. 

Some of the main advantages that accompany a DSO agreement are:

• A stronger benefits package
• Greater ability to focus on patient care
• Entering the dental industry without any major economic hurdles

Some of the disadvantages of working with a DSO are:

• You have less control over office policies and personnel  
• You will not be able to select your own malpractice insurance carrier
• You are beholden to numerous restrictive covenants

Before you commit to a DSO agreement, it is imperative you understand what it is and what it says. Other components of a DSO agreement involve:

Deciding the Level of Authority

Your DSO agreement will clearly define who has control over what parts of the business. While a private practice will give a dentist authority over their own staff, the computer software they use, as well as other processes implemented in their offices, these things will no longer be at their discretion under a DSO agreement.

Practice ownership aside, the dentist will have continuing ethical and legal obligations to meet within the accepted medical standard of care and to provide or suggest care that is in a patient’s best interests. This means the dentist should give serious consideration to negotiating terms that acknowledge this duty and specify that they hold authority over every facet of clinical care, such as treatment planning.

Benefits and Compensation

For recently graduated dental students who are battling exorbitant student loan debts, a DSO can offer many appealing opportunities. A DSO agreement will stipulate exactly how dentists will be compensated. Some agreements propose compensation only through a salary. Others state that dentists will collect a percentage of any payments that are collected.

Professional Liability Insurance

Also referred to as errors and omissions insurance or malpractice insurance, professional liability insurance protects licensed healthcare workers from claims that harm was caused due to negligence that was committed during the execution of their duties. 

Even though most dental professionals prefer to retain coverage from their own insurance company, DSOs usually decide what company is going to insure its associates.

Termination of Agreement

Details relating to how a contract will be terminated are included in the agreement. The terms will outline the contract’s duration along with what type of notification is needed for termination.

Securing reliable legal advice from an experienced and responsive California business attorney will ensure you understand everything that is contained within your DSO agreement and the options that are available to you

Leiva Law Firm Is Here For You

Without question, the Dental Service Organization market is one of the fastest-growing areas of the dental industry. This means it is critical that anybody who is interested in creating or operating a DSO or MSO seek legal advice as quickly as possible. It is important that you are aware of and fully understand the rights and responsibilities you are afforded as a business professional entering into the dental industry this way. Contacting a reputable law firm that is aware of the multiple ways in which dental boards view DSOs will give you a much-needed advantage as you make your dream a reality.  

The Los Angeles DSO and MSO attorneys at Leiva Law Firm have spent decades helping clients in the state of California prevail when it comes to the implementation and management of a DSO or MSO. Our legal team has helped multiple DSOs who offer services to dental professionals across the United States while remaining compliant with all state laws that govern the practice and operations of the dental industry. Contact our law firm today at (818) 703-1777 to see how we can help you.