As dental attorneys, we are involved in many decisions made by our dental practice clients.  A question that comes up frequently is whether the Practice should hire a third-party professional to assist with the completion of a particular task. When it comes to making that decision, we find that many Practices fail to recognize the value in hiring that third-party professional. When we are discussing this decision with our clients, we make the point that most Practices are not much different than our law firm when it comes to the aspect of operating a business.  Although we perform legal services rather than dental services, we have to address many of the same issues and answer many of the same questions as a dental practice when it comes to business operations matters. Our firm has seen the value in and takes advantage of hiring the necessary third-party professionals to allow our practice to function more efficiently and to increase our bottom line. 

 So, what do we mean by third-party professionals? Whether your business is a dental practice, medical practice, or law practice, there are certain professionals that should be hired by such closely-held service businesses. Below is a list of the common professionals that you should consider hiring to become part of your dental practice team:

 1.  Bookkeeper

Hiring an outside bookkeeper at an hourly rate of $25.00 to $35.00 an hour is more cost effective than you performing your Practice’s bookkeeping functions.  Depending upon the Practice’s hourly production on any given day, this may be in comparison to the $300.00 to $500.00 an hour you may generate performing dental services.  There are a number of services a bookkeeper should be handling for you, including: (i) maintaining all expense documentation; (ii) entering all income and expenses into the Practice’s software on a weekly basis; (iii) reconciling the Practice’s bank statements on a monthly basis; and (iv) working with the Practice’s accountants when it comes to preparing the Practice’s financial statements and tax returns.

 2.  Payroll Service

Whether you are a 1-person dental practice or a 25-person dental practice, you should be utilizing a payroll company to perform payroll services.  The tax laws alone, specifically the employment tax laws, are ever changing and it is difficult for any business to keep up on these laws. We encourage our clients to use an actual third-party payroll service, rather than a small accounting firm that performs payroll services.  A third-party payroll company can handle all aspects of your pay, from fringe benefits and healthcare, to the day-to-day calculations of compensation. We have found that using a third-party payroll service results in significant savings for your dental practice.

 3.  HR Consultant/Employment Attorney

If you look at your most significant overhead expense, it is your employees. Yet, many dental practices fail to properly take care of their employees and related employment matters.  This is not just in reference to a problem employee or a disgruntled former employee and how to deal with these situations.  It is also in reference to handling the day-to-day employment matters including: (i) maintaining personnel files and other important employment records; (ii)  addressing employee performance and misconduct issues; and (iii) the necessary hiring and sometimes firing of employees, if necessary.  This is just another area where it is invaluable and cost effective to be able to consult with an outside third-party on such human resource and employment issues. It is important to keep up on these issues, especially maintaining good employees, because we find that losing a good employee takes a practice 12 to 18 months to recover, which includes the time it takes to hire and train a replacement employee after the loss of a good employee.

4.  Practice Management Consultant

We cannot say enough about the practice management consultants.  They assist with all aspects of managing your Practice and bring unprecedented value to your Practice.  They assist with those issues that dental schools fail to teach you.  If you find a good practice consultant, keep them.  But, at the same time, do not jump into a long-term relationship with one either.  Do your homework and ask the right questions to ensure it is a good fit.

 5.  Accountant

 We have found that most Practices do hire an accountant to prepare their tax returns.  But, the Practices fail to engage them and pay them to perform the necessary tax planning.  Some Practices assume that if they are preparing the tax returns, the accountants should also handle all aspects of their tax and estate plan.  That is simply not accurate or fair to the accountant.  They need to be engaged and paid to (i) prepare the tax returns; and (ii) spend the necessary time to ensure you are in the most tax efficient position for individually and for your Practice.

6.  Attorney

You do not know how many times we have heard: “I wish we would have discussed this with you” or “I wish we would have had you handle this.” Case circumstances that illustrate this point are:

An owning doctor drafts an associate employment contract, including a noncompete, and fails, among other things, to include a provision in the agreement indicating that it is assignable.  Well, now the doctor wants to sell his Practice and the buying doctor cannot prevent the associate from competing, unless the associate agrees to it.  The Practice lost all of its leverage with the associate. In this particular case, we were happy to be representing that associate versus the owning doctor.

The fact is, by hiring these third party professionals, you ultimately save money rather than spend more money.  Those Practices that fail to recognize the necessity of hiring the third-party professional are simply not looking at the long-term cost savings in hiring those professionals. 

 Conclusion

 The fact is that those who say they prefer to handle it themselves, or say that they cannot afford it, are preventing themselves from growing and becoming more efficient. Do not be that business owner that spends their evenings or weekends preparing the books and records, processing the payroll, writing an employment contract, negotiating the lease, etc.  The fact is that you cannot do it as well, or as efficiently, as the third-party professional can.  Now, we are not saying you should not be involved.  You certainly need to work with and oversee those third-party professionals.  But, stick with what you are good at—performing dental services.  And, rather than spend your evenings or weekends on tasks that others should be performing, and that you should not be doing in the first place, spend more time with your family and friends. Go see a movie, go out to dinner, etc.  The point is that you should not allow your Practice to become your life.  Rather, use the Practice in a way that allows you to enjoy your life!