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It was 25 years ago last Monday that I graduated as a dentist from the University of Glasgow.

I believe it was around that time that (some) dentists started to become Millionaires.

The seeds were sown in 1992 with the imposition of a new NHS contract for dentists which reduced the NHS fees but left a loophole in place which, combined with other factors, allowed NHS Orthodontists to start making 4, 5 and 6x the amount of money the general dentists were making.

A few short years later, in the mid-1990s, against this backdrop the interest in dentistry as a ‘corporate’ business began to grow and the law which existed to stop anyone owning a dental practice apart from a dentist began to be examined and stressed.

For those of you old enough to remember, you will be able to cast your mind back to the concept of ‘corporate bodies’ which was a piece of paper that allowed you to set up a dental business. There were around 25 of these corporate body licenses in existence and in the mid-1990s they started to be auctioned for crazy sums of money.

I was party to a conversation around that time where someone had discovered that their practice held one of the corporate body licenses and was in negotiation to sell it to someone who was interested in setting up a larger dental business.

They sold it for hundreds of thousands of pounds. A piece of paper that they had not realised they had and not understood what it was banked hundreds of thousands of pounds.

And so it began… the setting up of corporate dental businesses, most famously by Boots in the late 1990s (Boots had had to buy a corporate body license to do this)

As a result of this the law was changed and corporate bodies were scrapped, this wiped their value entirely, anyone who had been sitting on it hoping it would go up lost it all.

Now we were in a situation where corporate and pension fund and private equity and investors were interested in dentistry ‘as a sector’ and so the value of practices went up in the land grab and bun fight to grab hold of practices that would make the city boys lots of money (in their minds)

But dentistry is not quite like other businesses and it’s important that you take the time to understand that before you invest hundreds of millions of your pension funds assets to make a substantial return when you flip the company onto someone else.

It looked so easy. As IDH grew, practices were acquired and hundreds of dental millionaires were created.

They sold their practices to the corporate for huge sums of money up front and a little bit left at the other end after they’d maintained the turnover of the business for one or three or five or seven years depending on how much they wanted to sell the years back for.

It seemed too easy for corporate companies like IDH because the money was guaranteed from the Government in contracts that had no end date and would just continue to roll in and roll in, but there was a problem.

While the dental nurses and receptionists had to accept their fate when the corporate rolled in, screwed the sign on the wall and changed the uniforms, the majority of dentists did not.

The ones who hadn’t owned the practice were still sub-contractors (not employees) and they were not under any compulsion to buy into the business or the ethos or the culture.

The dental millionaires (mostly, but not exclusively) became one of those associates; turning up for work, seeing out the time, ready to bail out of the profession.

There was a miscalculation here on behalf of the corporates that were buying in.

A corporate lifespan for such a deal is relatively short. They need in, increased profit and out in four - six years, or there abouts.

What they miscalculated though was that in many of the cases the dental millionaire associate had had enough after his earn out (or he left to open another practice for himself down the road)

The corporate couldn’t and can’t fill the shoes of people like that who leave.

The unique skill set that you have to become a dental millionaire is quite rare, that’s why you get to be that in the end.

To replace it within a business like a dental corporate is almost impossible.

So, the millionaires left and the rest of the associates who remained didn’t buy into the system. The new graduates who emerged 20 years after all this had happened didn’t want to work five days a week, bashing numbers with no prospect of ever becoming a dental millionaire and the system broke.

So, we have a recruitment problem that was created back in the early 1990s by a chain of events which will come to a head over the next three – five years.

Not enough dentists, and not certainly not enough dentists who want to work in the system that has been created, and not enough dentists who want to travel from their home country to work in a system like this and too many barriers to do that anyway.

We’ll be left with a generation of dentists who bought into the millionaire dentist concept with no prospect at all of becoming a millionaire dentist because that’s more or less done now. They will be disgruntled and disillusioned and will either work without any joy or leave altogether.

For the guys that are good (really good) the opportunities will only increase but they will almost certainly be ring fenced into working with the well-heeled, and well to do who will understand that they will not be able to access their style of healthcare under National Health Service arrangements.

While it was happening, the dental millionaire boom seemed to take a long time and there seemed to be no end in sight. I think most of the profession thought this would last forever.

As is always the case though, and in hindsight, it was but a short blip in the overall history of us and we’re onto something else.

Blog Post Number: 1717