On September 27, Tier Three experts Bill Henderson and Dr. Bernie Dolansky participated in an insightful, interview-style webinar hosted by Nick Fotache, founder of RevUp Dental. The session, titled “Canadian Dental Care Plan (CDCP): Success or Failure,” focused on the economic and operational impact of the CDCP on dental practices across Canada. Fotache guided the discussion, asking pointed questions about the CDCP’s challenges and opportunities, while Henderson and Dolansky provided their expert analysis on how dentists can navigate this new program effectively.

The conversation covered a range of topics, including practice valuations, staffing challenges, and the critical role of balance billing. Below are the key takeaways from the webinar.

Key Takeaways from the Webinar

Participation Rates and Initial Reactions

Dr. Dolansky shared that approximately 75% of licensed dentists in Canada are participating in the CDCP. He noted that while the majority are on board, a segment of 25% remains hesitant or opposed to joining. The general sentiment about the program’s effectiveness is mixed—about 50% of participants find the plan to be working well, while others remain neutral or express concerns. The introduction of balance billing, allowing dentists to charge patients the difference between the government-paid portion, the co-pay and their regular fees, has been a significant advantage. However, challenges, particularly with managing patient expectations of free care, have caused friction in many practices.

Economic Implications of the CDCP

Bill Henderson offered valuable insights into the economic consequences of the CDCP, especially its long-term impact on practice valuations. One major highlight was the importance of balance billing. Without it, practices risk losing revenue as government reimbursement levels may not keep pace with rising operating costs. Henderson emphasized that practices not engaging in balance billing could face significant financial strain over time. He warned that failing to balance bill could potentially lead to a 45-50% reduction in practice value, a stark reminder of how critical this issue is for the financial health of dental practices.

Staffing Challenges

One inevitable outcome of the CDCP is an increase in demand for dental services. Dr. Dolansky pointed out that with up to 9 million Canadians qualifying for the program, practices are likely to see a 10-20% rise in the number of procedures. While this surge may seem promising, it also brings with it exacerbating existing staffing challenges. The shortage of hygienists and chairside assistants, coupled with rising wage demands, means that practices need to prepare for both operational and financial adjustments.

Long-Term Outlook for Practice Valuations

For practice owners looking to sell in the next 10-12 years, the long-term effects of the CDCP are a pressing concern. Henderson advised that where practices have a meaningful number of patients who enroll in the CDCP, accepting the plan with balance billing, will be important to ultimately protect or even increase practice valuations. On the contrary, failure to adapt to the program could lead to a significant drop in revenue and practice value.

Both speakers cautioned against trying to build a practice by accepting CDCP patients without balance billing, which would leave practice economics subject to the whims of government reimbursement levels, significantly reducing interest from purchasers.  Both Henderson and Dolansky encouraged dentists to take a proactive approach by reviewing their patient lists, assessing how many qualify for the CDCP, and making informed decisions based on their practice demographics.

The Importance of Balance Billing

Throughout the webinar, one message was clear: balance billing is crucial to maintaining profitability and practice value. By charging the difference between the CDCP-covered portion and regular fees, practices can avoid eroding their revenue. The experts strongly advised against offering discounted rates without balance billing, as this could create a precedent that undermines both short-term profits and long-term sustainability.

Final Thoughts

As the CDCP continues to evolve, it’s clear that dental practices need to stay informed and agile. For many, the program presents both opportunities and challenges, and how practices choose to navigate these will have lasting impacts on their financial health. Henderson and Dolansky’s expert insights provided actionable advice for those looking to maximize their participation in the CDCP while safeguarding their practice’s value.

Missed the webinar? Watch the full recording on YouTube, and stay tuned for more events to help you navigate the changing landscape of the dental industry.

Looking for personalized advice on how the CDCP could impact your practice’s value? Contact us at Tier Three to schedule a consultation with one of our experts.