Profits down, costs up for dentists

A typical dental practice made a net profit of £125,691 in 2010/11.

That’s according to statistics released by the National Association of Specialist Dental Accountants and Lawyers (NASDAL).

This is a decrease of just under 10% compared with the figure of £139,569 in the previous year. Across the board fee income has dropped and expenses risen.

For associates, the fall is less dramatic at four per cent, to £68,000 from £71,000 the previous year.

The majority of associates still have a 50% arrangement, although this is changing downwards for some.

NASDAL notes however that this is not always 50% of the full UDA (unit of dental activity) rate enjoyed by the practice. Average UDA rates are £25.56 for practices but £20.82 for associates.

Private practice fee income remained static in 2010/11 but rising costs led to a 7% drop in net profit, down to £117,723.

On the other hand, in mainly NHS practices, fee income fell by 3%.

Nick Ledingham, NASDAL chairman, believes this was because fewer non-exempt patients were going for treatment and some dentists were not fulfilling their NHS contracts.

Rising costs, especially in wages and overheads, have hit profits across the profession.

In NHS practices, these fell by nearly 10% to £133,643 and are now back down to 2005/6 levels.

Within this overall figure there is a sharp difference between those principals with associates and those in single-handed practice.

Those working on their own experienced a drop of 2.66% down to £115,821.

Whereas those principals with associates had a fall by 12.64% to £129,644.

There is still a financial advantage in having associates but it has reduced from £29,416 in 2009/10 to £13,823 last year.

NASDAL also reported a slight fall in practice sale values to 94 per cent of turnover in the last quarter of 2011. There was marked difference between NHS practices at 106 per cent and private at 80%.

Nick Ledingham, NASDAL chairman, said that the figures provided ‘an interesting insight into how dentists and their patients responded to an economy in the doldrums’.

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