UK Dental Practices: What does the future hold after COVID?

With UK dental practices open from 8th June, there is much speculation and fact about how they will operate in the coming months, whilst incorporating the necessary changes to function efficiently and cost-effectively within the recommended guidelines. 

For those dentists who have been practicing for many years, you will be all too aware of the continual updating of Universal Precautions that have taken place in recent decades as new health risks have arisen, and knowledge has been gained.What does the future hold for dental practices after COVID-19?

Hepatitis B in particular raised the bar in a major way.  In time, a Hep B vaccination came along and everyone felt somewhat safer. Full occupational health procedures for dental practices became well established.

When HIV arrived on the scene, although initially very concerning to practitioners, the Universal Precautions already updated for Hep B were generally found to be adequate.

In 2009 (updated in 2013) the DoH published HTM 01-05 – with the specific intention of further raising the standard of decontamination and cross infection control in dental practice. 

A new health crisis: COVD-19

Rolling with the punches and keeping patient health at the forefront is nothing new for dentists. However, the current COVID-19 crisis has created unprecedented financial implications for practices.

These vary depending on if you are a practice within the NHS, private, or a mix of both. How these areas have fared through this crisis will also impact on future career plans of many dentists and that, in itself, may change the face of the occupation

Private practices have been hit hard

Private practices particularly will have suffered financially through the COVID-19 crisis. Those with significant NHS contracts will have gone through the crisis rather better. Some practices with only small or modest (mainly child and/or exempt adult patient contracts) may have chosen to surrender those contracts rather than accept wider NHS deployment during the crisis.

So how will this affect not just your working practices but your finances both as an individual and business?

NHS practices

  • The Force Majeure provisions in the NHS contract will have ensured NHS practices maintained their income, dentists, and staff together with profitability throughout the crisis – and so they should be in a good position to resume just as soon as lock-down ceases.
  • There will be a large backlog of patient problems that will require sorting-out.
  • Practices should not be under financial pressure to work additional hours to compensate for lost income, as UDAs (units of dental activity) will have been credited and funding continued throughout regardless of no clinical activity.
  • Nor, in England at least, will NHS practices wish to increase output on a month by month basis because, unless they are awarded additional non-recurrent UDAs, they would risk running out of UDA capacity before the year-end.
  • Funding for additional non-recurrent UDAs from smaller contracts that have been surrendered during the crisis will probably be made available to practices able to deliver additional capacity, enabling annualised turnover to actually increase.

Private practices  

  • Largely capitation-based private practices will in general have fared better financially through the crisis than those mainly dependent on fee-per-item patients as they will have received regular income throughout.
  • Staff will largely have been furloughed.  Many practices will hopefully have been topping-up staff pay to the full 100%.
  • Business rates for dental practices have not been exempted.
  • Rents will still have fallen due.
  • Most private dental practices will have been ineligible for Government Business Grants.
  • Very few practices will have had Business Interruption Policies with terms that allowed them to claim during the crisis lock-down.
  • Some practices will have had to increase their borrowings to remain in business.
  • Professional subscriptions and indemnity may have been abated – but will still fall due for the period despite little if any, direct patient contact having taken place.
  • Self-employed associates will mostly have been ineligible for government crisis provisions for the self-employed – due to average earnings over £50,000.
  • Under-capitalised and over-borrowed practices and those with particularly high overheads (expensively refurbished premises, prestige addresses, etc.) will have been hardest hit.
  • Once lockdown is lifted, furlough is over and practices have re-opened, they will be very busy initially – dealing with the backlog of urgent care that will be needed.
  • After this initial flurry it is possible that, due to patients’ reduced financial circumstances, practices may then see routine patient demand fall below normal levels.  The extent to which that occurs is very hard to predict.
  • Until patient demand has risen, again some practices might have to make dentists and staff reductions in order to retain maximum cash and protect their businesses.
  • Many practices will defer planned capital expenditure until their cash position has improved.

Within the subsection of private practices, capitation-based private practices will have additional concerns. Some patients may well have experienced a downturn in their finances. How do you treat patients fairly when some may have suspended payments while others have continued throughout the crisis?

Private practices that are fee-per-item based will have been hit hardest financially as no income will have been received throughout the crisis.

Some future practice costs and profitability implications:

1. Routine preoperative testing of patients for temperature and/or viral antigen status.

2. Surgical staff routinely wearing long-sleeved full-length gowns (changed for each patient).

3. FFP3 respirator and full-face visors, use of antimicrobial mouthwash pre-operatively.

4. Use of rubber dams routinely for most operative procedures.

5. All practice rooms designated by purpose and provided with either a positive or negative atmosphere depending upon designation – together with full environmental air filtration.

This is all going to cost a great deal of money! Plus, this will be against the backdrop of patients possibly reducing their spending on non-NHS dental work and the indirect cost of additional patient procedure times.

If the time taken to conduct a procedure were to double, for example, then the number of procedures completed in a typical week would halve.

Finally, those of you who had the finish line in sight and had an offer to buy your practice may well have been told this offer needs to be renegotiated.

What can we do to help?

Although financial advisers are often involved in the enjoyable aspects of life such as investing retirement lump sums or practice sale proceeds, we do spend a good proportion of our time involved in the nitty, gritty areas of life.

With any change in your work, you need to review your overall arrangements. That includes your personal protection, business protection, borrowing levels, the risk taken with your investments, pension planning for the future, and general cash flow.

We can support you through all of those. 

However, sadly we can’t make things return to how they were, but we can help you to find the best financial way forward for you, your family, and your business in the new post COVID world.

This isn’t something that needs to be put off until work recommences. If you have some time on your hands, we are carrying out meetings via Zoom and mobile, and are here to support you.

In the meantime, stay inside, stay well and we’ll be waiting for you on the other side.

Has your dental practice been severely affected by COVID-19? Let us know by adding a comment below.

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