Orange County’s dental industry is trying to deal with some pain from the slowing economy.
Dentists are seeing patients put off cleanings and other work, while dental product makers are seeing a drop in orders. Insurers, meanwhile, are seeing a drop in membership amid job losses.
“The dental industry in general is experiencing a bit of a toothache,” said Shawn Potter, vice president of marketing for SybronEndo, part of Anaheim-based Sybron Dental Specialties Inc., a seller of general and specialty dental products.
States such as California and others hit hard by the housing downturn have seen the biggest impact, according to Steven Bilt, chief executive of Santa Ana-based Bright Now Dental Inc., which provides business support services to some 300 dental practices in 19 states.
“Generally, the dental market has seen declines when it comes to the majority of procedures,” Bilt said.
The situation has pushed dentists and those that sell goods and services to them to re-evaluate their costs.
Bright Now, which has yearly sales of $480 million, is doing what it can to drive dentists’ business, Bilt said. That includes marketing campaigns to bring in patients and financing to help patients pay for services.
But some dentistry segments are holding their own.
Children’s dentistry appears to be somewhat immune to economic pressure, according to Paul Reggiardo, a Huntington Beach pediatric dentist who has practiced since 1975.
“We are very fortunate in being less affected by economic downturns and upturns than a lot of other segments of the economy,” he said.
Reggiardo said his practice’s revenue is down slightly so far this year, “but at a manageable level.”
To cope, he said he’s cut costs in a bid to stave off higher patient fees.
His practice hasn’t had to do things such as linking up with health financing companies to assist patients because “most care that we’re delivering for children does not approach the type of costs that require” it, Reggiardo said.
For children, tooth fillings can cost $200, while pricier procedures such as a root canal can run about $2,000. Orthodontic costs can run more than $4,000.
Tighter Spending
Fewer patients and tighter reimbursements have led dentists to be cautious with their own spending.
“(Dentists) are really telling us that they’re shopping for better deals on equipment and big-ticket purchases,” Sybron’s Potter said.
In some cases, Potter said dentists are delaying their major device buys or in rare cases, buying less-expensive brands.
Sybron is a unit of Danaher Corp., a Washington, D.C.-based company that’s best known as the maker of Craftsman tools sold at Sears.
About a year ago, when the recession was in its early throes, Irvine dental software maker EDI Health Group Inc. started looking for ways to “help our clients keep their chairs full,” said Scott Wellwood, the company’s president.
EDI’s Dental XChange provides software that allows dental offices to do things such as process insurance claims and check benefit eligibility.
Dental XChange stepped up marketing and pitched dentists’ offices that still were handling what Wellwood called “high volumes of paper” with ways to help them cut down on paperwork in claims processing and reduce costs.
It also began offering lower-cost credit card processing for its customers, and to a lesser extent it started to participate in programs with health financing companies to help patients borrow money to pay for dental care, Wellwood said.
Tightening Credit
He said that the health financing market has been a tough nut to crack because of credit restrictions.
“Lenders just in general are more hesitant to put money out there,” Wellwood said.
Dental XChange works with financing companies that serve patients whose credit is imperfect.
“There may not be the 0% interest teaser rates that everybody else is offering, but there’s still an opportunity for them to maintain their treatment,” Wellwood said.
This outside financing can help people keep up their dental care even if their insurance lapses because of unemployment.
“Layoffs are taking dental insurance away from many potential patients, so higher unemployment definitely has a correlation or an impact on patient flows,” SybronEndo’s Potter said.
Figures from the American Dental Association show that nearly half of all American adults don’t have dental insurance.
On the insurance side, Delta Dental of California, which has more than 496,000 members in Orange County (see story, page 28), hasn’t seen patients “overusing” benefits because of the recession, said Kevin Jackson, the San Francisco-based insurer’s group vice president of underwriting.
Delta did see a slight hike in usage by Denti-Cal patients in recent months as people rushed to get in dentist visits before their coverage expired as a result of the budget shortfall, Jackson said.
Denti-Cal is the dental version of MediCal, the state insurance program that covers poor and disabled Californians. Denti-Cal is funded with a mix of state and federal money.
About 3 million adult Californians lost Denti-Cal insurance coverage in the wake of the state’s long-running budget issue.
There hasn’t been the same surge in work by insured patients.
“On the commercial side, the usage pattern seems normal overall,” Jackson said.
The federal Bureau of Labor Statistics has said that demand for dental care will rise in the coming years because of population growth, middle-aged and older people keeping their natural teeth longer, more awareness of dentistry’s importance and increased ability to pay for services.
State figures show there are some 1,570 general dentists in OC. Full-time OC dentists earn an average wage of $146,000, according to state figures.
The county doesn’t have a dental school. California has five statewide, including schools at the University of Southern California and the University of California, Los Angeles.
The University of California, Irvine, and Chapman University in Orange aren’t planning to develop dental schools, school officials said.
