As a group, dentists have become more savvy in the area of practice management, but many are still too quick to accept some of the notions that have been perpetuated by dental magazines, by professional organizations, by the media, or by their dentist friends.

These myths and notions swirl through the dental community with surprising intensity and regularity. Sadly, many dentists fall victim to these myths and lose precious time and money chasing avenues that don't really exist.

Here is the last of five myths that pervade the practice of dentistry - and the reality.

Myth:

Hire associates to generate passive income.

Reality:

Most dentists hire associates to make passive income, help with a busy office, or ensure coverage while on vacation.

The reality is that these are poor reasons to hire an associate and most associateships don't work out. Four out of five associate arrangements fail within the first year.

Not only do you have to consider pay and overhead, but also the increased malpractice liability and management time involved in adding another practitioner. If the associate does not work out, you have to fire the support staff that you hired, unless you plan to hire another associate. You also have the risk that the associate will leave, open a practice just a few miles outside the radius outlined in the contract, and take many of your patients.

Are you thinking of taking on an associate to make passive income? When you consider the increase in marketing budget needed to bring in more new patients, salary and benefits for additional support staff (usually one assistant plus at least ½ a front desk person), compensation for the associate, plus supply costs, the profit margins are usually very low. The profit, if any, simply doesn't justify the high risk and hassles. Plus you have all the hassle of recruiting, training, and managing additional staff. Any income you generate is anything but passive.

On the clinical side, be aware that the associate is likely to be weak in the area of treatment planning and could be slow or inefficient in completing some procedures. Since you are not personally seeing the patients, managing the resulting consequences will be difficult.

Are you thinking of taking on an associate because you're too busy? Here again, adding an associate may not be the solution. If you're seeing too many patients, the problem can be solved by incrementally raising your fees. A few patients will leave, your work load will be reduced, and your income will be higher.

Are you thinking of adding an associate because you want to take a vacation while ensuring coverage? This is no reason to hire an associate. Have a dentist friend or colleague cover a day or two for you and pay them for it. Often, the specialists you refer patients to will be happy to provide some emergency care or call in a prescription.

Of course, there are some circumstances in which having an associate does make sense. If you are close to retirement and want someone to buy your practice, or if you have health concerns or are disabled, an associate may be the answer. But under most circumstances, adding an associate is too risky and won't add much profit.

If our perspective strikes you as good sense, we invite you to request a confidential practice assessment so that we can quantify for you the hidden profit potential in your practice. It's free. Request a practice assessment.