Consolidation in the dental industry: a closer look at dental payers and providers


Research article

Abstract

We examine the effect of commercial dental insurance concentration on the size of dental practices, the decision of dentists to own a practice, and the choice of dentists to work at a dental management service organization—a type of corporate group practice that has become more prevalent in the United States in recent years. Using 2013–2015 dentist-level data from the American Dental Association, county-level data on firms and employment from the United States Census, and commercial dental insurance market concentration data from FAIR Health®, we find a modest effect of dental insurance market concentration on the size of dental practices. We also find that a higher level of commercial dental insurance market concentration is associated with a dentist’s decision not to own a practice. There is inconclusive evidence that higher levels of dental insurance market concentration impact a dentist’s decision to affiliate with a dental management service organization. Overall, our findings imply that dentists consolidate in response to increases in concentration among commercial dental insurers.

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