ADA finds 'major flaws' in Pew midlevel provider report

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The ADA is challenging the findings of a recent Pew Center on the States report that claimed to demonstrate how dental practices can profit from adding midlevel providers to their team and improve access to care in the process.

The report, "It Takes a Team: How New Dental Providers Can Benefit Patients and Practices," issued in December 2010, was the first to examine the effects of hiring hygienists or dental therapists on the productivity and profits of a private practice, according to Pew. Pew used an economic tool -- the Productivity and Profit Calculator -- to evaluate the effects for dental practices that hire one of these allied providers, applying the calculator to three types of practice scenarios:

“We believe these flaws lead to erroneous conclusions regarding the potential contribution of new allied providers.”
  • A solo, pediatric dental practice, with a dentist, two dental assistants, and administrative support
  • A solo, general practice, with a staff structure similar to the first scenario
  • A small group practice with a dentist owner, two associate dentists, six dental assistants, and administrative support

Pew found that most private practice dentists who hire new types of dental care providers can serve more patients, improve productivity, and maintain or improve profit margins and increase access to care. Among the specific findings:

  • In solo dental practices devoted to serving the privately insured, adding any allied provider increased productivity and pretax profits. In every scenario tested, solo dental practices increased their earnings by a range of 17% to 54% when hiring a new provider.

  • In a state with an average Medicaid reimbursement rate (60% of dentists' standard fees), solo practice dentists serving only the privately insured could hire a dental therapist, shift their patient mix to 80% privately insured and 20% Medicaid patients, and still see their pretax profits increase between 6% and 7%.

  • In states with Medicaid reimbursement rates that are 30%, dental practices see reduced profits when they serve Medicaid enrollees. Yet even in these instances, Pew's study found that dentists fared better financially serving low-income patients with an allied provider rather than without one.

'Several major flaws'

But in an analysis issued March 1, the ADA questions Pew's methodology and points to "several major flaws" in the Pew report, including the misrepresentation of solo general and dental pediatric practices, the assumption of unlimited demand for dental services, and the assertion that the employment of dental therapists will significantly improve Medicaid patients' access to care.

"We believe these flaws lead to erroneous conclusions regarding the potential contribution of new allied providers, the benefits that may be accrued to Medicaid patients, and dentists' net incomes," the ADA wrote.

For example, the base income for general dentists Pew used is significantly higher than ADA surveys have shown, the ADA said. Pew uses a baseline income of $337,242 for a solo general dentist without a dental hygienist, compared with $194,320 according to ADA data.

But Shelly Gehshan, director of the Pew Children's Dental Campaign, told that Pew used gross income in its model, not net income, in order to make the model applicable across all U.S. states.

"The ADA analysis has some mistakes and some very different assumptions in it," she said. "We stand by our work."

The ADA analysis also takes issue with Pew's contention that general dentists can increase their income from $337,242 to $511,446 by adding one hygienist/therapist, the ADA noted. However, as the Pew report notes, "the new allied provider, compensated in accordance with his/her training, would command higher wages/salaries than that of a traditional dental assistant or dental hygienist," the ADA wrote. "Therefore, employing a new allied provider in a solo general or pediatric practice to produce what dental assistant or hygienists are producing currently would increase the cost of existing services rather than reduce it."

In other words, the ADA noted, "it would be economically irrational and inefficient to employ dental therapists to produce procedures currently produced by lesser trained allied dental personnel."

But Gehshan said that Pew is just trying to provide dental practitioners and public policy makers with the tools and information they need to understand how new workforce models may enhance their ability to improve access to care, especially for the 49 million underserved Americans who do not have ready access to a dental care provider.

"The reason we produced It Takes a Team is because we understand the financial concerns of private practice dentists," she said. "They aren't just healthcare providers but also business owners. So we built a model and vetted it carefully with a blue-ribbon advisory group including dentists, an economist, and a health center manager. We used ADA data and worked with a business management consultant who helped us build the model and refine it until we released it. Our interest is not in protecting the interest of any particular group. We have no dog in this fight except improving access to care."

Medicaid reimbursement rates key

The ADA also takes Pew to task for suggesting that adding a dental therapist to a dental practice will increase access to care for Medicaid patients. As Pew stated in its report, Medicaid reimbursement rates are 30% to 70% below market rates, with an average of 40% across the U.S.

"The introduction of new allied providers does not affect the Medicaid reimbursement rates," the ADA wrote. "If dental utilization were to increase for Medicaid patients, the gap between market prices and Medicaid reimbursement rates would still have to be reduced."

The major problem with access disparities is the lack of reasonable Medicaid reimbursement rates, according to the ADA -- a fact the ADA believes is not fully appreciated in the Pew report. "Instead, the Pew report suggests that access disparities is a dental workforce issue. This cannot be further from the truth."

In addition, the ADA noted, Pew asserts that if solo general practitioners were to serve 20% Medicaid patients accepting reimbursement rates at 60% of market prices, their income would be increased only slightly from $337,242 to $432,542. Consequently, solo general and pediatric dentists and small practices have no economic incentive to serve Medicaid patients, the ADA noted, and this aspect of the Pew report makes "no economic sense."

At the same time, however, the ADA chastised Pew for misrepresenting dentists as being primarily concerned with profitability.

"We believe that by focusing the analysis on profits, the Pew report inaccurately portrayed dentists as only being concerned with the bottom line with respect to treating Medicaid patients," the ADA analysis stated. "Clearly, that is a false representation."

Gehshan said that Pew is just trying to help dental practitioners figure out whether it makes economic sense for them to add a new type of care provider to their team.

"Only a small number of dentists accept Medicaid, and one of our key goals with this is to figure out whether hiring a new provider would help dentists see more Medicaid patients and not lose their shirt," she said. "And the answer is 'yes.' We are not trying to make any choices for dentists, we are just trying to give them and policy makers advice. But the fact remains that dentists could do well financially by doing good, by accepting Medicaid and CHIP patients. We don't see these new providers as a threat to dentists. Dentists will always be on top, and we will always need dentists. But if we can enhance their productivity and profitability, why not?"

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