New dentists hang on by their teeth

Dental student debt reaches all-time high, while practice margins diminish

Dental school

The average University of Washington dental student graduates with a debt load of $255,000 – and that’s still $30,000 lower than the average in the U.S., which doubled between 1996 and 2016. The debt load of a public school dental education increased by 133%, including undergraduate school, living expenses and fees.

Local dentists, as well as top academicians, are watching Washington’s dental industry transform based on the economic pressures today’s young dentists face.

Bringing dentists back to Main Street

Dentists have long been a fixture on America’s Main Streets. Until recently, the most common path for recent dental school graduates was to start their own practice, purchase a practice from a retiring dentist or buy into a partnership with other dentists.

More and more, however, dentists cannot afford to open or buy into a small business because they are already so saddled with debt, and banks won’t consider loaning them more money – the risk is too high. Dentists find themselves taking per diem or quota-driven positions at chain dentistry practices, or Dental Service Organizations, which are popping up in Southwest Washington.

“The need to make bigger bucks quicker has steered graduates to more reliable pay,” said Dr. Ronald Hsu, a pediatric dentist and owner of Storybook Dental in Vancouver. “Standalone clinics sometimes can be fickle; working for a corporation seems more stable, perhaps more secure.”

As an officer of the Clark County Dental Society, Hsu advocates for his profession, and feels lucky that when he graduated from the UW dental school 15 years ago, he was only paying $4,000 a term.

“Tuition alone is quadrupling, while revenue and reimbursement for dental procedures has increased 50%,” Hsu said. “When your burden and cost quadruples and revenue has only increased by 50%, it becomes quite untenable.”

Putting tuition hikes on ice

Southwest Washington dentists campaigned hard for the appointment of Gary Chiodo as interim dean of the UW School of Dentistry, and he came on in August of 2018 after a successful post as interim dean at Oregon Health and Sciences University. Chiodo graduated from dental school in 1978.

“I had no debt whatsoever,” he said. “I was paying $500 per term. It was a lot less expensive and it enabled me to what my passion was. I immediately went into public health, which was the lowest paid (sector of the industry).”

The first thing he did at UW was put a stop to the tuition hikes.

UW School of Dentistry is one of the top in the nation and is ranked second in the world for research. Projected costs for a 2019-2020 resident enrollee total $382,185 over four years, with tuition accounting for $242,687. According to the 2017-2018 Survey of Dental Education published by the Health Policy Institute Commission on Dental Accreditation, UW’s program ranks as the third overall most expensive public dental school in the nation.

“Since I’ve been here as dean, I’ve frozen tuition – last year, this year, and I intend to do it next year,” Chiodo said. “We’ll keep it frozen until we end up somewhere in the middle of the market.”

Dr. Allison Brault is a 32-year-old dentist practicing in Kelso. Like many of the students Chiodo has met, Brault decided to return to her hometown after graduating at the top of her class from the University of Washington School of Dentistry in 2014. She said she “tried to live frugally during school to minimize my student loan debt as much as possible” and started working in the field after a one-year general residency.

“I was lucky to be acquainted with my current business partner, Dr. Michele Anderson, near the end of dental school by a mutual professor,” said Brault, “so I stayed in contact with Michele and started working for her when I was done with my residency.”

Brault came on at Twin City Dental as an associate in 2015 and in February 2018 bought into the practice.

“Becoming a partner was the next step and a natural progression. It was financed with business loans,” she said. Brault’s path is a more traditional one, but not without difficulties. She said “high student loan debt is definitely one of the biggest challenges” facing young dental graduates today.

Schools to ‘grow out of the red’

Dean Chiodo said the UW School of Dentistry needs to increase clinic revenue, which was his focus at OSHU, in order to rely less on student tuition.

“If your clinics are operating in the red, you can’t cut your way out of that, you have to grow your way out of it,” he said.

There are loan repayment programs for dentists who work in public clinics and underserved areas. But Chiodo is looking to a model that existed when he was in school – opening rural clinics to serve underserved populations and to train students, rather than simply contract students with already existing clinics throughout the state. Presumably these placements would come with some kind of tuition reimbursement. Hsu also thinks dentists who go into academics should receive “some kind of loan forgiveness.”

Brault agrees the pressure should come off the student.

“If dental schools could become more efficient and managed more like a private practice/business, that could help the budget deficit so tuition wouldn’t need to keep rising,” she said.

What about the children?

Hsu is deeply concerned with the fate of the most vulnerable population – low-income children. Half of Clark County’s kids are on the state Medicaid plan, and Washington state bears the third lowest Medicaid reimbursement percentage in the nation. It’s been frozen at the same rate for more than 20 years.

“Fewer and fewer dentists participate with Medicaid, or more sinisterly speaking, they participate and overtreat,” Hsu said. (Corporate chain Aspen Dental, for example, has been sued numerous times for diagnosing and charging patients for dental treatment they don’t need.) “The only way we get paid is when we do things to people. When we do things for people, we don’t get paid. There’s nothing to code for and nothing to bill for.”

Hsu is referring to counseling his young patients and their parents on diet, nutrition and dental decay prevention. He said, “the amount of time spent there is equal to procedures. In some sense, we lose money every time we do that.”

Chiodo has had some success requesting supplemental Medicaid reimbursement from the legislature for UW’s dental clinics, and both he and Hsu advocate for more equitable Medicaid reimbursement from the state.

While dental enrollment is up overall, said Chiodo, students are increasingly heading into specialty dentistry, where more money can be made – every specialty, that is, except for pediatrics.

“One of the things we’ve seen recently is an increase in applications for specialty programs in every case except pediatrics, which sees a disproportionate share of Medicaid patients,” he said. “It’s the only specialty that has seen a 10% drop.”

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