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Orthodontics vs. Implants: Which is more profitable?

Posted by POS Course Adviser on 3/28/18 9:49 AM

Dental school doesn’t always cover the business side of dentistry, but it is essential knowledge for all dentists who want to run a successful practice. You may have asked yourself, ‘Could I benefit from adding additional services to my practice? How much do these things cost? What’s the best use of my time and resources?

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We put together some financial metrics to help you compare the profitability of two popular procedures: implants and orthodontics. To do this, we looked at POS instructors in our area, and compiled their income and expenses for providing an implant crown and orthodontics.

In our analysis, we broke down the orthodontics category into traditional (Phase II) orthodontics, and Phase I orthodontics. We also calculated three important financial metrics: net income, income to expense ratio and the net income per hour of chair time. We are keeping the calculations simple to include just the costs for providing the procedure and aren’t including the operational costs of running your business (e.g. rent, insurance etc.),

Note: Every dentist has different rates and expenses, based on the demand, location, case difficulty, and preferences. We hope these general estimates from private practices in California will be a helpful guide.

Let’s crunch some numbers!

The Results:

Implant Crown

1 month duration, 1.5 hours chair time

Income Summary
Implant Crown Fee $1700.00
Records Fee $450.00
Total Income $2150.00
 
Expense Summary
Lab Fee $225.00
Implant parts $175.00
In office materials $75.00
Disposables $20.00
Shipping $15.00
Consultation (30 min chair time) $125.00
1 visit (1 hour chair time) $250.00
Total Expenses $885.00
 
Net Income $1265.00
Income to Expense Ratio 243%
Net Income/chair time hour $843.33


Providing an implant crown is the fastest of these procedures and can provide a quick, same day $1265 net income.

With about 90 minutes of consultation and chair time hours, your office takes home $575 of net income per hour of your and your staff’s time.

Unfortunately, lab fees and material costs eat up around one-fifth of your income. But, if you put in $885 of material and time costs, you get back three times your investment. Not too shabby!

 

Traditional Orthodontics

Bicuspid extraction case, 24 mo duration, 6 hours chair time

Income Summary
Ortho Fee $5500.00
Records Fee $450.00
Total Income $5950.00
 
Expense Summary
Brackets, Bands, Archwires (IP) $250.00
In office materials $70.00
Disposables $40.00
Shipping $15.00
Study Models $80.00
Consultation (1 hr chair time) $250.00
20 visits (15 min ea, chair time) $1250.00
Total Expenses $1955.00
 
Net Income $3995.00
Income to Expense Ratio 304%
Net Income/chair time hour $665.83


Traditional orthodontics typically takes more time to complete at 18-24 months and has a larger cost to you at $1955. But is the investment worth it?

Looking at the numbers, you may not get as much return per hour. But luckily for you, the chair time in orthodontics is primarily assistant time and very little doctor time. Orthodontics has relatively low material costs and time involved when you compare it to its revenue. With a $1995 material and time expense, orthodontics gives you more than triple the income and a 25% better return on your investment compared to implant crowns.

We’d say that the investment return is quite nice for bread and butter orthodontic patients (like the bicuspid extraction case we calculated in this article).

Know how many patients you want to treat? Calculate your career ortho potential.

 

Phase I Orthodontics

13 month duration, 2.2 hours chair time

 

Income Summary
Phase I Fee $3000.00
Records Fee $450.00
Total Income $3450.00
 
Expense Summary
Brackets (8) $47.12
Bands (4) $34.70
Archwires (2) $1.54
Disposables $20.00
Shipping $15.00
Consultation (1 hour chair time) $250.00
8 visits (10 min ea, chair time) $333.33
Total Expenses $781.69
 
Net Income $2668.31
Income to Expense Ratio 441%
Net Income/chair time hour $1212.87


Interceptive orthodontics is a powerful tool that can truly help your young patients who have small jaws, Class III malocclusions, oral habits, posterior crossbite, open bite, or deep bite. (View the power of Phase I treatment in this case study). Not only is preventative care very useful, but luckily for you, it is also quite lucrative as well!

With minimal materials needed, Phase I orthodontics is one of the most profitable services you can offer. Phase I orthodontics often requires just a few bands, brackets and archwires, and sometimes an appliance like buttons, LLA, TPA, RPE, cleats, quadhelix, or myofunctional appliances.

Phase I orthodontics has the least material cost of all these procedures by far, under $220 in this calculation. With $782 of material and time expenses, you receive more than four times your investment. With less visits, your assistant chair time is much lower than in traditional orthodontics.

Phase I orthodontics has a whopping $1213 net income per hour in chair time, the best return of all these procedures. Phase I orthodontics has a 1.8x better income to expense ratio over implant crowns. Meaning, for all the costs of creating an implant crown, you could earn almost double that by providing a young patient interceptive orthodontics.

 

Conclusion

Orthodontics and implants are both profitable specialties. Orthodontics, especially Phase I orthodontics, can be extremely lucrative. Since orthodontic revenue is typically spread out over a longer period, you should determine what type of financial arrangement you like best. Some dentists like the reliability of monthly income of orthodontics while others want their income up front, like what they get with implants.

Phase I orthodontics is the clear winner in income to expenses and net income per hour of time. However, should you stop providing implants and implant crowns? No! Implants are a wonderful service for your patients, and are profitable.

If you don’t provide Phase I orthodontics, however, it may be a good business idea to consider adding it to your list of services. Not only is it highly profitable, but it’s a valuable part of orthodontics that most specialists encourage general dentists to offer.

 


Want to see what orthodontic cases any GP can help? Download this free eBook...

Ortho Cases Any GP Can Help Now
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Questions about implants or orthodontics profitability? Ask in the comments below.

Topics: Economics of Orthodontics, Tips for Success

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