Sharon, Mass.-based Qualitas Dental Partners chooses to be selective of potential partners, spending time to thoroughly vet practices and ensure they align with its values.
CEO Robert Rubino and founding doctors Judy Pratt, DMD, and Michael Kacewicz, DMD, recently spoke with Becker's to discuss their organization's expansion goals, its operational model and how Qualitas differs from competing DSOs.
Editor's note: Responses were lightly edited for length and clarity.
Question: How would you describe Qualitas' growth so far this year?
Robert Rubino: Our growth so far has been what we wanted it to be. We are thoughtful in adding partners to the partnership. We are really looking for practices that are esteemed leaders, either in their specialty or in their geography, so we have spent a lot of time working through and getting to know new practices. We do have a good team here. The partners spend time with new partners who are looking to come in as well. So it's a little bit of a process to join us, largely because we think we are building something that is the best model for dentistry going forward, and we just want to make sure those who come in feel the same way and would be good partners with us. This approach also gives prospective partners an opportunity to get to know the people they would be partnering with.
Q: How does Qualitas Dental Partners stand out from competitors?
Dr. Michael Kacewicz: One of our main goals was to create a game changer in the industry. We wanted to create a company where the doctors had a serious equity stake, and what that allows us to do is control both clinical autonomy across the board and ensure the quality of care that we've been providing to our patients for the last 10, 20 [and] 30 years. It allows the doctors to control all that going forward, as opposed to not.
RR: Our founding dentists had this model in mind. They wanted to be the decision makers in many of the things we are doing, so we are owned and governed by our dental partners. We organized this way to protect and promote the entrepreneurial spirit of the traditional dental practice owner. There are many dentists who went into dentistry to be business owners, to take their practice in the direction they wanted it to go. Unfortunately, many of the existing corporate dentistry models undermine and degrade that entrepreneurial and business owner mindset. We want to be the opposite. We think Qualitas is the perfect symbiosis of clinical excellence and well aligned supporting resources.
The dentists do not need, do not want, and should not be dictated to by anyone other than themselves because they are highly skilled and naturally entrepreneurial. However, dentists can use support in key areas so they can spend time treating patients well, treating their teams well and having the kind of life they want to have. That's why we think it's a perfect marriage between what clinicians should do and what business does well, which is recruiting, marketing, the financial side, thinking about investments — all that should be done by people who get up in the morning thinking about that. These professional resources allow the dentists to continue to do what they're doing. That's how we are differentiated. We really are there to provide arms and legs support for the dentists as they continue to run what they were running. This was designed by dentists [and is] owned and governed by dentists because they saw what was out there and wanted it to be something completely different. That's why we think it really is a better model for the future of dentistry.
Q: What are your priorities for the rest of 2024?
RR: We are focused on continuing to improve the patient experience, things like additional providers so there's more time that the practices are open. [We are also] thinking about growth in our existing practices, so is there equipment or expansion that needs to happen that the dentists have always wanted to do, but now they have the arms and leg resources to pull it off.
On the inorganic side, we have a very robust pipeline. It's very big, which gives us a lot of comfort that what we're doing is the right thing. So we have a lot of interested people who have found us. We do not do hard marketing. We do not do a lot of outreach. Most of our opportunities come from our existing partners. This existing partner referral-based acquisition approach fosters a spirit of camaraderie and is an important filter in our drive to have high quality practices and partners as part of Qualitas.
MK: Something we spent a lot of time focusing on this past year is [continuing education.] When you're talking to a lot of the younger dentists out there and a lot of the younger associates, the thing that echoes across the board is continuing education. Whether it's their thirst and desire for knowledge, or whether it was a lack of learning during the Covid period, they want to continue to learn. We have some of the top specialists in New England who they can learn from, so we put a lot of time and effort into our CE programs in order to cultivate that desire to learn, and also to just allow them to explore different avenues they may not have had the opportunity to do before.
Dr. Judy Pratt: We try to establish mentorship for both the associate and the practices coming on. So we've had a nice flow of practices that want to join. They usually align with one or more of the founders or the board members, so we take them under our wing and then we follow that process all the way through to make sure they're getting all their questions answered and there's not any doubt or any issues for them because we want everyone to feel like they're included, that they know what's going on and that they're part of our entity in more ways than one. The younger dentists, they really want to be mentored, so we have multiple mentors from different practices with different associates. They might not even be in your own practice, but you're working with them to help them meet their goals or help them to practice differently or learn something they may not have known before.
Q: Are there any specific goals for expanding your network?
MK: It was a very thoughtful process in how we formed Qualitas. It resonated so well across the board, from the younger doctors to the seasoned veterans, to the point where we find ourselves in a position in which we get to be thoughtful on who we want to partner with, which is great. So, when we do meet someone who is interested in learning more about our company, it's just as much of an interview process for them as it is for us. We've really been able to spend some time and put a lot of thought into the people who we do want a partnership with because it's important in order to establish that quality of care we promote.
Q: What qualities do you look for in a partner?
RR: Number one, they really must have demonstrated that they have cared historically about their patients and their teams. We are big believers that if you take care of your patients, then your patients come back and refer others. It's the right way to run a business. To take care of your patients well. Take care of your practice teams and providers well because they are the ones who take care of your patients. So, when we look at potential partners, they must have that caring side to them, and we will go back and look at that and say, is that actually true? We also look for a track record of innovation and growth. Have they had a history in the past of being innovative? Are they open to innovation? Are they open to growth? Qualitas dentist partners also want new partners who are collaborative.
One of the beautiful things about dentistry is they are generally a very collaborative group of professionals. Qualitas, as a partnership, looks to add practices that enjoy collaborating with their partners. The last [qualification] is strategic thinking. We need everyone's best ideas and thoughts ... there's a big emphasis here on how do you do things better? We want providers who can bring their very best to the partnership.
JP: We want this to be a model that lasts for generations. We want people who are interested in growth and interested in growing with the group. We didn't want anybody who is short-term, because [some dentists] want to sell their practice, but they want to be done in a year or two. We didn't want that. We wanted people who are going to be invested in growing and continuing to work and collaborate, and not someone who's going to be short-term.
Q: What are some of the biggest challenges facing DSOs right now?
RR: Reputation is a big issue for DSOs. I think DSOs must be very careful in how they develop their model and how they treat people because the current state of affairs is checkered. There's a DSO marketing narrative, and then there's reality. The dental community, like a lot of sectors, is very tight. So if things are not going particularly well for one dentist who joined a DSO, it gets out there fast. What we've been successful at is, when people join us, they become our biggest cheerleader. That is a direct result of our approach, but it is not common in the industry. I think DSOs have to be thoughtful about their treatment of their teams and treatment of patients. Both patient and team members should be at the heart of everything they do. The current narrative out there suggests that this is not happening everywhere. We believe those models are flawed and underperform.
We don't call ourselves a DSO. Qualitas is a partnership, and we support that by the fact that we are dentist-owned and dentist-governed. There are a lot of models out there that call themselves partnerships, but they are not. They're owned by private equity and governed accordingly. So I think the other thing DSOs must be very careful of is, how do they think about the next generation of dentists? Who are you hiring? How are you training? What opportunities are you giving them? Because that is important. You must realize that the team you're developing today are your leaders tomorrow.
The other thing everyone must think through is, how do you align interests? You need alignment of interest, and that goes everywhere from how do you think about the patient, how do you treat people, to what are the economics that everyone gets? We have a very aligned model where we're dentist-owned, we have opportunities for our associates to have ownership, and everyone is on mission. That's critical. You don't see that in a lot of DSOs because the ownership is not in the providers. Maybe a little bit, but that's not sufficient. You really want to align interests economically, and in your culture, so that you can deliver really well because what we're delivering is healthcare.
Q: What are some mistakes DSOs make in their models?
RR: There are many models, and I think this is where the industry has to be careful. There's a slavish devotion to capturing efficiencies quickly and at all costs. That’s not the right way to think about this. We don't think about it that way. We are focused on efficiencies from better supply contracts and other non-people efficiencies. We look to reinvest those in our people, either more people or higher salaries. We also look to use our efficiency savings on investments in our practices, both equipment and facility. That's a thriving business when you reinvest your efficiencies, but to go out there and just cut costs and try to pocket the savings, that's not a winning model. First, it doesn't win hearts or minds with anyone. Second, your good people leave or become disenfranchised. Patients do not like when your teammates leave or become disengaged. Patients will leave your practices accordingly and stop referring friends and relatives. So the big thing I would say is, be careful of a slavish devotion to efficiency in an effort to pocket the savings. You do that at your peril.
You need to be good stewards of what you're doing, so that you make much better business decisions for the benefit of patients and the team that's treating them, and you will grow very well. That's what we follow, the virtuous cycle up. Treat the people well who are treating your patients well, and, in turn, your business will thrive. The other one is the vicious circle down, which is [when] your good people leave because they don't like your business model. When good people leave, patients will leave. You don't want that, and that's what I think many DSO models are in danger of. You want a mindset that supports the virtuous cycle up, not the vicious cycle down.