Understanding the Distinction: MSOs vs. DSOs in Dental Practice Management
Jul 17 2024 0

Understanding the Distinction: MSOs vs. DSOs in Dental Practice Management

When it comes to running a dental practice or being employed by one, dentists have options. They can choose to run their own business and manage both the administrative and clinical aspects of operations, or they can partner with either a Dental Service Organization (DSO) or a Management Support Organization (MSO). Depending on the capabilities and goals of a particular dentist, any one of these could be the right choice. Each has its advantages and disadvantages.

Understanding the Distinction: MSOs vs. DSOs in Dental Practice ManagementConcerning DSOs and MSOs, there is no doubt that investors are particularly fond of these models. A substantial amount of money is spent on healthcare across the United States, with the Centers for Medicaid and Medicare reporting that by 2028, U.S. healthcare spending will be over $6 trillion. As a result, private equity firms have their eyes on the dental industry, which is considered a critical and sustainable medical sector. These firms appreciate the relatively safe investment into what generally promises them a considerable return.

Since dentists go to school to earn their degree in dentistry and not business, when they graduate and begin their career, they typically want to focus on doing what they know. That would be taking care of their patient’s dental needs. While owning one’s own practice seems like the dream, the associated expenses and administrative duties that come along with that idea can be overwhelming and just a downright nightmare. That is why dentists who prefer to stick to dentistry and want advancement would gravitate to a business model where they don’t have to deal with the challenges and headaches of running a business. Hence, they may look into an MSO or DSO.

For assistance with MSO or DSO formation in California, the Los Angeles MSO and DSO attorneys at Leiva Law Firm have decades of experience helping dentists successfully implement and manage DSOs or MSOs.

When determining whether a DSO or MSO is right for you, you have to consider the benefits and risks.

There are several benefits of a DSO, including:

  • Dentists keep control over business decisions but are provided with administrative and non-clinical support to help them better manage the business side of the practice, which simplifies operations.
  • Production goals and revenue objectives are set and directed by the dentist.
  • The lack of a business services agreement allows and gives dentists greater purchasing power, enabling them to negotiate with vendors and secure the best pricing.
  • Available capital can allow dentists access to state-of-the-art dental technology such as CAD/CAM systems.
  • Dentists can engage in ongoing professional training opportunities.

By contrast, MSO benefits include:

  • Through a single, third-party management service organization, a dentist can spend less time on business operations and more time with patients.
  • The MSO dictates productivity goals.
  • Dental practices can offer greater patient access and support, like extended hours or weekend hours.
  • Dentist have a greater ability to take time off without their patients suffering from lack of care.

Speak to an Attorney at Leiva Law Firm Today

Despite the many benefits of DSO or MSO formation, there are risks and nuances that can be unappealing.

For all of your DSO or MSO questions, you are welcome to call Leiva Law Firm at (818) 519-4465 today to schedule a free consultation.

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