Peak Dental Services believes its path to ownership for dental hygienists will benefit team members, the organization and patients.
By Graham Garrison
A patient often spends more time with the hygienist than anyone else in a dental group practice. Thus the hygienist, perhaps more than any other member of the practice, has the greatest opportunity to solidify the relationship, experience and, ultimately, loyalty to the practice, said A.J. Peak, CEO of Peak Dental Services.
Those arent just sentiments. Recently, Peak Dental Services, a leading dental services organization with over 50 locations throughout Colorado and Texas, announced a new ownership package for all the organizations hygienists. The intent of the ownership package is to honor the importance of their hygiene team, and expand their financial goals within the company.
For the first time, Peak Dental Services will be providing hygienists with ownership opportunities similar to Peak Dental Services dentists.
When the time came to make the choices for the ownership package, Peak Dental Services made a bold move and offered ownership in Peak itself, not just in the doctor or hygienists dental practice, said A.J. Peak at the time of the announcement. It is disingenuous to limit the ownership package to the dental practice because our providers prosperity would be limited to those 4 walls. Now, all our doctors and hygienists can grow their wealth with us as an owner of the whole company.
Solidifying the patient relationship
There are many ways that hygienists play a key role in the dental group practice. Peak cited three in particular. First, patients generally spend more time with the hygienists than anybody else in the practice, so it solidifies the relationship, experience and, ultimately, loyalty to the practice.
Second, and consistent with number one, patients look to the hygienist to discern the recommendations of the dentist. Almost more than anybody else, the hygienist helps in most of the conversations where patients accept treatment because of the trust built, he said. They often look to the hygienist as a third-party guide to what the dentist recommends.
Third, if you dont have capacity, then youre not able to fulfill consumer demand. To fulfill that demand, you need hygienists for obvious reasons.
Equity in the organization
Because Peak Dental Services is so passionate that the customer experience begins with and is often carried out by the hygienists, leadership wanted to offer the equity program to them on the same terms as the dentist owners. Ultimately, we wanted to back up our words on hygienists being a critical, if not one of the most important, individuals delivering a distinctive patient experience, Peak said. You need hygienists to deliver that. They often spend the most time with our patients.
Patient experience is the organizations number one core value. And as a part of that, in a really tough economy, Why wouldnt we, is what leadership asked themselves. If hygienists really are the key ingredient to the patient experience, at the board level we asked: Why wouldnt we? Nobody had an objection, it was just meditating on how quickly we could do it.
There were lots of discussions on how the ownership package would be designed. Leadership asked themselves why would they design it differently for hygienists versus the dentists? We really believe that theyre a critical stakeholder in the company and our success, so why would we make it different?
Theres a minimum investment threshold, and a quality investment threshold criteria that hygienists must meet. Were not letting poor performers in the sense of quality be allowed to be a stakeholder in the company, Peak said. Essentially theres different criteria that theyve got to fulfill to have a stake in the DSO. But once they do, theyre an equity holder.
About 10% of Peaks hygienists signed up for the program in its first offering, which coincidentally was the organizations initial goal. The ownership package was brand new and to Peaks knowledge, has not been offered in the industry before. We didnt make it any easier or harder than it is for the dentists, Peak said. In some ways, I think that gave it credibility, but it also took some courage for them to invest just like the dentists. We held them to the same standards on that end, and so were pretty excited about that.
Peak Dental Services will only open the window to enroll once a year. They are reopening the window around March-April of this year, and have had many more hygienists since the first window inquire about the package. It will be interesting to see what happens, given the early adopters.
The organization is already seeing benefits from the hygienists investment in the company. Hygienists that joined are part of the monthly owner updates. Theyre often the very first that get involved with decisions.
Annually for owners there is a retreat. This past year, Peaks ownership team went to Vail, Colorado for the weekend. Their owner hygienists were in the front row seats contributing to the discussion in where they are going as a company, what things they need to work on, what new technology or new systems they may want to get involved with, etc. They have an active voice that really doesnt differ from the owner dentists, Peak said.
In regards to the owner dentists, Peak estimates that 90% immediately were on board from the start with the package, and 10% took some time to think about it. That 10% just wanted to think through what it would mean, he said. Ultimately, it was a unanimous decision of the owner dentists.
As a board, we were wildly supportive. Our financial sponsor, Varsity Healthcare Partners, which only invests in healthcare, provider-based businesses, is wildly supportive of it.
We wouldve rolled it out even sooner, but we wanted to give the doctors time to digest it and make sure they supported it.
Peak believes the doctors, hygienists, board and financial sponsor have all been pleasantly surprised by the results. There were a lot of What Ifs, he said. But I think everybody is incredibly mature, professional, and did exactly what we wanted it to do. We wanted to share in the upside and the ownership mindset and a contribution to key decisions on that front. Were really looking forward to opening the window this year, and hopefully it continues to expand.
The ownership package has benefited the organizations culture because of the credibility it reinforces. If we say that hygienists are critically important, then I dont know how more I can back it up than to say you can be side by side with me as a founder in enjoying the upside, and we can all work together to create a good outcome and build a strong company together, Peak said. So its the credibility that were in this together and were going to share in it.
These are unprecedented times post-COVID. Peak Dental Services is not forcing the ownership package on people. Its a personal decision. For some its a family decision if they want to, but we wanted them to know that its there if they want it.
Indeed, post-pandemic the bar is now higher for every business across all economic sectors. Peak Dental Services has tried to either meet or exceed those expectations, whether its financial, making sure people feel like theyve been heard or that theyre responsive to feedback. We are where we are, Peak said. If the bar increases, then weve got to meet those demands. Sometimes it might be an economic demand, sometimes it might be scheduling flexibility, sometimes it might need to be more increased responsiveness or involvement in the decision-making on a piece.
The thing Im most proud of is the equity program, Peak continued. Nobody is perfect, but being willing to do that and our financial sponsor being wildly behind it, and the dentists being behind it, that, for me, was a big landmark. It was a credible act to say, Hey, this is what you mean to us, and this is how we are in this together.
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