Organizations MSOs and DSOs - Dental Attorneys

In today's dental marketplace, DSOs are becoming increasingly common. These organizations are growing rapidly, adopting different structures to support dental practices. Some acquire practices, while others form partnerships. Their primary role is to handle the non-clinical aspects of dental practices, allowing dentists to concentrate on providing clinical care.

At Wood and Morgan, our dental business lawyers understand the sophistication of these organizations and the importance of dentists being represented by a knowledgeable and strong professional team.

Our firm is a leader in assisting dentists in dealings with DSOs and private equity groups, covering sales, acquisitions, partnerships, investments, and associate agreements. We also consult on the formation and organization of DSOs, ensuring compliance with state and federal laws, rules, and regulations.

In today's dental marketplace, DSOs are becoming increasingly common. These organizations are growing rapidly, adopting different structures to support dental practices. Some acquire practices, while others form partnerships. Their primary role is to handle the non-clinical aspects of dental practices, allowing dentists to concentrate on providing clinical care.

At Wood and Morgan, our dental business lawyers understand the sophistication of these organizations and the importance of dentists being represented by a knowledgeable and strong professional team.

Our firm is a leader in assisting dentists in dealings with DSOs and private equity groups, covering sales, acquisitions, partnerships, investments, and associate agreements. We also consult on the formation and organization of DSOs, ensuring compliance with state and federal laws, rules, and regulations.

What Does a DSO Do?

DSOs provide a range of business support services to dental practices, including staffing, advertising, management, and revenue cycle management. As they grow, they can centralize operations and negotiate better deals for supplies and equipment, reducing costs for practitioners. Most importantly, they maintain a structure that complies with state laws against non-dentists owning dental practices, allowing dentists to retain clinical autonomy.

Types of DSOs

There are mainly two types of DSO models:

Dentist Owned and Operated (DOO) - Centralized Management

The Dentist Owned and Operated (DOO) model represents a form of centralized management in the world of Dental Service Organizations.

In this model, licensed dental professionals take the lead in managing multiple practices under a single corporate umbrella. This approach gives dentists direct control over key business decisions, marketing strategies, and the standards of clinical care provided across their practices.

By retaining this level of involvement and oversight, dentists ensure that their vision and values remain at the forefront of their practice's operations.

The DOO model may appeal to those who wish to maintain a high degree of personal involvement in both the clinical and administrative aspects of their dental practices.

Dental Management Services Model (DMSO) - Decentralized Management

Contrasting with the DOO model, the Dental Management Services Model (DMSO) adopts a decentralized approach to practice management. In this model, the day-to-day management responsibilities are outsourced to a third-party Management Service Organization (MSO).

This arrangement allows dental practitioners to focus primarily on clinical care, as the MSO handles various administrative and operational aspects of the practice. The primary goal of the DMSO model is to enhance profitability while upholding high standards of clinical care.

This model is often chosen by dental professionals who prefer to concentrate on patient care and clinical excellence, relying on specialized external management to optimize the business side of the practice.

Additionally, many DSOs are backed by private equity, bringing a new level of sophistication and financial resources to the dental industry.

 

MSO vs. DSO: What's the Difference?

While MSOs and DSOs both support dental practices, they differ in ownership and service scope.

  • MSOs, potentially owned by several stakeholders, offer more focused services like marketing and HR support.
  • DSOs, typically dentist-owned, provide broader services, including supply chain management and quality assurance.

The choice between an MSO and a DSO depends on the specific needs of the dental practice.

Why Partner With a DSO?

Partnering with a DSO offers several advantages:

Administrative Support & Streamlining Operations for Better Patient Care

DSOs can manage the administrative tasks that come with running a dental practice. This includes handling billing, accounting, and scheduling. By taking on these responsibilities, DSOs allow dentists to focus on what they do best: providing excellent patient care. This shift in focus can improve patient satisfaction and clinical outcomes.

Efficiency and Cost Reduction

Efficient management of administrative tasks by DSOs can also lead to significant cost reductions. They can identify areas where practices can be more efficient, reducing overhead costs and increasing the bottom line. This efficiency translates to more time and resources for patient care and practice growth.

Talent Recruiting and Management/Building a Strong Team

DSOs can recruit and manage talent, ensuring dental practices have the best team in place. This includes hiring skilled dental hygienists, dental assistants, and administrative staff.

Continuous Training and Development

DSOs often have dedicated resources for staff training and professional development. This ensures the practice's team stays current with the latest dental techniques and practices, ultimately benefiting patient care.

HR Management and Compliance

Handling human resources, including payroll, benefits administration, and compliance with labor laws, can be a difficult and time-consuming task. DSOs assume these responsibilities, ensuring practices comply with employment laws and regulations.

Legal Compliance

One of the advantages of partnering with a DSO attorney is their experience in legal compliance. Dental practices must adhere to state and federal regulations. DSOs ensure that practices comply with these laws, reducing the risk of legal complications.

Implementing Best Practices

DSOs also help implement the best patient care and record-keeping practices, further protecting the practice from potential legal issues. They stay abreast of changes in industry standards, ensuring the practice remains compliant.

Access to Modern Equipment

DSOs often have negotiating power when purchasing dental equipment and supplies. This means they can acquire state-of-the-art technology and materials at more competitive prices than individual practices can achieve on their own.

Access to advanced dental technology is important for providing the best patient care and staying competitive. DSOs enable practices to keep up with technological advancements without the prohibitive costs often associated with these investments.

Modern equipment can lead to more efficient operations and innovative treatment options. This enhances patient care and attracts more patients looking for the latest in dental care.

How our Dental Lawyers at Wood and Morgan Can Help

Deciding to partner with or sell to a DSO is a big step. We strongly advise against negotiating without proper representation. Our firm has a track record of advocating for sellers and establishing DSO management companies in compliance with state laws.

We have represented over 8,000 dentists since 1980, focusing on their business needs within the dental community. If you're considering a sale, partnership, or establishing a DSO, you need an experienced dental attorney.

For inquiries about DSO transactions or partnerships, contact the dental lawyers at Wood and Morgan at (800) 499-1474. We're here to represent your best interests and guide you through every step of the process.