veros dental: identifying your career path
Post on 14-Sep-2014
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DESCRIPTION
A helpful guide for those considering a career in dentistry.TRANSCRIPT
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Identifying you Career Path: Planning Your
FutureBy Amber Banks, Consultant
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Topics• Comparing Practice Options• Associateship Basics• Acquisition Basics• Start-Up Basics
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Comparing Practice OptionsAdvantages and Disadvantages
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Associateship
• Immediate income• No financial risk• Learn from the senior doctor
– Clinician vs. business owner
• Build relationship with patients• Enhance hand speed
Pros• No practice ownership or “say
so”• Building a practice that is not
yours• Non-compete• Minimal control (staff, patients,
procedures)
Cons
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Practice Acquisition
Pros
• Immediate income• Established patient base• Staff already trained• Established patient & staff
relationship
Cons
• Not “your” practice• Overpaid team• Staff not open to “new” doctor• High overhead• Aged equipment• Potential loss of patients
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Practice Start-Up
Pros
• You pick your team• Determine practice philosophy
and how YOU want the practice to run
• Build it the way you want• Pick the location
Cons
• Lower income initially• Stress of starting from scratch –
lots of decisions to be made• Getting everything established
– insurance, billing, scheduling
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Other Options
Military• Gained experience• Enhance hand speed• Debt reduction
Corporate• Fast-paced environment• Steady compensation• Learn practice philosophies• Enhance experience• Increased hand speed
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How to decide? • Talk with a mentor• Personal self assessment• Networking• Talk with family• Don’t just settle• Meet with senior doctors who
have already done it!
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Self Assessment
• Where do you see yourself after residency?• Are you ready for practice ownership (financially and
emotionally?)• Identify your one, five and ten year professional and personal
goals• Do you want to practice alone or with others?• Are you a risk taker?• Where do you want to live?
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Associateship BasicsPreparing for your Associateship
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Where to Start?Select your professional “team”
Attorney• Review your contract• Legal advice and guidance• Long-term plan
Accountant• Assist with compensation
structure and tax considerations
• Tax planning and preparation• Prepare you for practice
ownership
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Know Your Long-Term Objective• Identify what you want to accomplish in your Associateship• How long do you want to be an Associate?• What salary do you desire to make?
• Is it realistic and attainable?• Is there an option for practice
ownership?
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Know the Practice• Space for two doctors• Previous Associates• Reduction to the schedule (owner)• Booked schedule• Enough dentistry for two doctors• Reputation of practice• Types of patients you will be seeing
• Medicaid• Insurance
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Know Your Responsibilities and Expectations• Requirement to grow the practice (marketing)• Hours (weekends, after hours, ER)• Production goals• Management of staff
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Understand Your ContractFirst, HIRE AN ATTORNEY! Then… • Review your contract PRIOR to signing!
• No such thing as a “standard” contract• Non-compete & non-solicitation• Employee vs. Independent Contractor (W2 vs. 1099)• Expenses to be covered• Compensation structure• Benefits offered
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Tax Considerations
Employee• Determined by IRS• W-2 • Portion of payroll taxes covered
by employer• May be eligible for benefits• Work schedule Dr. requests
Independent Contractor• Determined by IRS• 1099-MISC• Pay all taxes (payroll taxes too!)
– Self Employed• No benefits offered• Set own schedule
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Do’s & Don’ts
Do…
• Ask questions!• Visit the practice (shadow the
doctor)• Spend time with the doctor outside
of the practice• Hire dental specific advisors• Understand your contract and
compensation• Take your time!
Don’t…
• Rush into a decision• Do it alone• Disregard the unknowns• Be afraid to ask questions
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Acquisition BasicsMaking your best clinical and financial decisions
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Due DiligenceFocus Points:• Clinical and financial due diligence• Identify your needs• Determine your financing needs• Start your search for a practice• Avoid making the biggest mistakes • Interview the seller and know what questions to ask• Negotiate with confidence
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Investigate the Business
Clinical/Practice
• “Active” patient base• Staff• Accounts receivable• Procedure mix• Fee schedule• Financing (internal/external)• Equipment• Production vs. collections
Financial• Offer/purchase
– Can you get approved for financing?• Professional valuation• Practice and building for sale
– How long has it been for sale?• Tax returns• Financial statements• Unusual costs• Overhead review
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Other Areas to Consider…• Current marketing plan• Current lease• How long will the seller stay on?• Informing the patients/staff• Role of your professional team
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Preparing Yourself
Owner• Employee issues/concerns
(hiring/firing)• Maintaining accounting
software• Decision making• Hours of operation• Business insurance• Office lease
Clinician• Services to be offered• Style of patient care• Fee schedule• Insurance acceptance• Patient mix (ages)
Being a business owner and clinician are very different!
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Identify Your Needs Start Simple. Ask yourself if these items meet your needs… • Desired location of the practice• Number of operatories• Annual production you wish to achieve• Staffing needs• Fee for service vs. PPO vs. Medicaid• Personal cash flow needs
• Desired compensation• Paperless office• Preferred hours of operation• Does your experience/education line up with the practice for sale?• Procedure mix• Type of sale
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Identify Your Needs… Self-Assessment
5 Wants
1)2)3)4)5)
Identify challenges to achieving your wants.
5 Needs
1)2)3)4)5)
Identify challenges to achieving your needs.
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Identify Your Needs… Self-Assessment
5 Deal Breakers
1)2)3)4)5)
Can any of these deal breakers be overcome to move forward?
Other Areas of Concern
1)2)3)4)5)
Determine if any of the other concerns should be discussed with the seller or your team.
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Determining Your Financing Needs
• Cash flow• Working capital • Credit score• Co-signer• Secondary source of income (if needed)• Personal financial budget• Determine any “action steps” to get you prepared for financing
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Starting Your Speech
Who can assist?
• Peers/colleagues/professors• State & local societies (IDA &
IDDS)• IDDS & IDA sponsored events• Internet searches• Practice and commercial real
estate brokers• Your network and team
Get connected!
• Attend IDDS & IDA meetings• Become a member!
• Read Dental Economics and DentalTown
• Industry specific research• Attend study club/local meetings• NETWORK, NETWORK,
NETWORK!
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Avoid Making the Biggest Mistake
• Dual representation (buyer & seller representation)• No representation• Non-dental specific advisors• Rushing through a decision• Lack of due diligence
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How to Interview the Seller
BE CONFIDENT!!• What are the reason(s) for selling?• How long has the practice been for sale?• What are post-retirement plans?• Is the seller willing to stay on after sale?• Are any associate doctors on payroll?• Are the accounts receivable for sale?• How long has the selling doctor been in practice?• Any other challenges? (personnel, collection management, case
presentation, scheduling, marketing, competition)
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How to Negotiate with Confidence
• Hire the right dental specific team• Get good advice• Be confident about the offer• Know the practice/do your due diligence• Self assessment• Know what you can afford• Talk to your mentor and other doctors who have gone through
purchasing a practice
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Start-Up BasicsBuilding your Business Plan – What do I do first?
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First Things First
• Be prepared!• Be confident!• Be patient!• Be cautious!• Be excited!
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Be Prepared!!
• Business plan• Credit score• Co-signer• Personally guarantee the debt• Personal savings available?• Identify secondary source of income
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Be Confident!!… in your business plan… about your skill set, experience and education… to be a business owner and clinician…in your marketing plan
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Be Patient!!… with the timeline (it could be a 12-month process)… in setting your goals… in selecting your team
-professional advisors-staffing
… in establishing your patient base… in paying yourself
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Be Cautious!!… of your personal and business cash flow budget, but stay on target!… of who you hire on your professional team… of who you hire as your staff… in sticking to your estimated time line
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Be Excited!!
• Stay focused and excited about the overall process!
• Talk with your family and friends• Meet with your mentor• And be excited about the end result!
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What to Expect: Financing
• Cash flow and working capital needs• Business plan• Loan amount, interest rate, term• Experience• Credit scores• Personal financial statement/budget
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What is the Business Plan?
Think Long-Term Success!• Allows you to look/plan ahead• Allocates resources• Defines your vision• Prepares for future
opportunities/issues• Focuses on key points• First impression of YOUR
business
Other Purposes• Starting a new business• Acquiring an existing business• Applying for a business loan
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Writing a Business PlanWhat should be considered?
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Purpose of the Business Plan
Clearly identify…• Purpose of the plan• Mission/vision/goals• Keys to success!• Description of the business• Summary of personnel• Location!• Marketing & strategy
Be descriptive!• Sources & application of
funding• Secondary source of income• Education and experience• Professional references• Financial plan & statements
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Questions?
Contact: Amber Banks, Consultant [email protected]
317-452-4580 ext. 762
For more tips visit our blog at:www.verosdental.com/news-blog/