What is a DSO, and why is it Called the "Big Lie"?
What is a DSO, and why is it Called the “Big Lie”?
By Michael W. Davis, DDS
The term “DSO” means dental support organization or dental service organization. In almost all cases, the acronym of DSO is an intentional misrepresentation. This misrepresentation is essential for corporate ownership and control of dental practices, which is unlawful in most states.
The myth contends that DSOs limit their control of dental practices to only non-clinical aspects such as managing janitorial services, advertising, collection of fees, payroll service, etc. In no way should they inject themselves into the doctor/patient relationship. In reality, DSOs are focused on their fiduciary responsibility of returning maximal shareholder profits. That includes managing clinical aspects of the dental practices, which they beneficial own (or control for their superior private equity investment firm).1
There truly exist a few honest DSOs, which represent a minuscule segment of the dental industry.2 A few doctors actually do contract with this handful of DSOs for non-clinical administrative services. However, in the vast majority of DSOs, doctors only serve as figurehead nominee owners or minority shareholders with limited clinical authority. This is in contrast to the big lie, of dentists seeking out DSOs to partner with for their practices.
One must ask themselves, what valid owner of a dental practice would relinquish control of “their” bank account, to a third party vendor? What true doctor owner of a dental practice would allow a vendor control of the sale of “their” asset, the dental practice? What doctor owning a dental practice would enter into any agreement with a vendor, which lasts into perpetuity, or long-term (20-30 years)? In essence, most so-called DSOs employ business service agreements (BSAs) to establish a shell entity (one or more nominee owner dentists or a professional corporation of sham-owner dentists) for bogus regulatory ownership. In reality the DSO, not doctors, pulls the strings.3-5
Why is doctor ownership of a dental practice in the public interest? Dentists have an ethical and legal responsibility to place the interests of patients, above all other interests.6 Corporations have an ethical and legal obligation to place the interest of shareholders, above all other interests (including patients). The conflict-of-interest is self-evident.
Naturally, there are unethical dentists, who decline to place patient interests to the fore. These doctors must be disciplined, and if appropriate, disbarred. By contrast, no DSO is ethically or legally obligated to place patient interests to the fore. In fact, the vast majority of DSOs are strictly focused on their obligation with return of maximal profits for shareholders. The danger is very clear of corporations owning and directing healthcare.
The DSO industry is quite vocal in its denial of injecting themselves into the doctor/patient relationship.7-9 In their responsibility of maximizing profits and control of the clinical practice, they fight legislative actions which would support the doctor/patient relationship. They demand control over dental labs, referral to their selected in-house specialists, control over dental materials, patient scheduling, clinical time allotted per patient visit, clinical production quotas and bonuses, control over patient records, control over dental hygienists’ treatments to maximize production, etc.
These corporate dental clinics aren’t about dentist support or service. They are all about restructuring of the dental industry, for corporate ownership of healthcare generally and dentistry specifically. It’s about placing maximal profits over patient well-being. It’s about retaining professional marketing firms, to produce a big lie. Spin like “economy of scale”, supplants the truth of a business model of Medicaid fraud, arm-twisting upselling of unnecessary dental services, and bait-and-switch. Doctor/patient decisions and the informed consent process are scrapped in the corporation’s interest, all without the patient’s consent or knowledge.
1. Davis MW. Myths Rumors and Bald Faced Lies- Truths Revealed about the DSO Industry. Dentist the Menace online dental news. Nov 24, 2014; http://blog.dentistthemenace.com/2014/11/myths-rumors-and-bald-faced-lies-truths.html
2. Miller B. What are Non-DSO Dental Support Organizations?. Group Dentistry Now. July 14, 2016; http://groupdentistrynow.com/the-non-dso-dental-support-organizations/
3. US Fifth Circuit Court of Appeals case no. 07-30430. Revised Dec 30, 2008; http://www.ca5.uscourts.gov/opinions%5Cpub%5C07/07-30430-CV0.wpd.pdf
4. Davis MW. Corporate Healthcare- Important Contracts. Dentistry Today Jan 2017; 36 (1): 10-12. http://www.dentistrytoday.com/viewpoint/10259-corporate-healthcare-important-contracts
5. Davis MW. Basic Economical Models of Large Scale Corporate Dentistry. June 5, 2015. Dentist the Menace online dental blog. http://blog.dentistthemenace.com/2015/06/basic-economic-models-of-large-scale.html
6. American Dental Association. ADA Principles of Ethics and Code of Professional Conduct. Section 3 Beneficence; http://www.ada.org/en/about-the-ada/principles-of-ethics-code-of-professional-conduct/beneficence
7. Childress S. DentalWorks Chain Misdiagnosed for Money, Dentists Say. Frontline Mar 13, 2013. http://www.pbs.org/wgbh/frontline/article/dentalworks-chain-misdiagnosed-for-money-dentists-say/
8. Heath D. Senate Report Faults Children’s Dental Chain for “Fundamentally Deceptive” Care. Frontline July 25, 2013. http://www.pbs.org/wgbh/frontline/article/senate-report-faults-childrens-dental-chain-for-fundamentally-deceptive-care/
9. Soderlund K. N.C. Bill Authorizes Task Force to Examine Rules on Dental Management Companies. ADA News July 16, 2012; http://www.ada.org/en/publications/ada-news/2012-archive/july/nc-bill-authorizes-task-force-to-examine-rules-on-dental-management-companies
Michael W. Davis, DDS maintains a general dental practice in Santa Fe, NM. He serves as chair of his district dental society peer-review and is active in state dental association issues. He also consults with attorneys on dental fraud and dental malpractice cases. Dr. Davis may be contacted at MWDavisDDS@Comcast.net or www.SmilesofSantaFe.com
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