Different Types of Compensation Structures for Dentists - 2023

Written by: Priyanki Amroliwala

Are you a Dentist looking for a job or struggling to hire an Associate at your practice due to a lack of talent or fierce competition? Or you may be a dental school student struggling with so many job interviews and confused about where you want to practice and who pays what? Well, the confusion has ended…here’s your one-page white paper on how different organizations may compensate Dentists. This will help you decide which job to take or what company you want to apply to. Or it can help you stay competitive with compensation when hiring an Associate for your practice.

Listed below are examples of compensation structures in the dental industry. (Note: These may have changed from when the research was done and varies based on timing, location, and needs of company):

Here’s a basic breakdown of how Dentists typically get compensated based on location and organization:

Per-diem versus a Draw?

Per-diem is a daily guaranteed minimum, meaning you get paid no matter who shows up in your schedule for the day and what procedures you do.
Draw is provided per day, however, deducted when making less the following day.

What is a draw and how does it work? In a draw, the practice pays the associate in anticipation of future earnings. Another way to look at it would be as a forward of future income. If the associate’s earnings for a pay period fall under the agreed draw amount, then the practice would cover the difference in the associate’s paycheck. Whatever extra the practice paid would then be deducted from the associate’s paycheck during the next pay period in which the income generated was above the draw amount.

Which one is better you must be thinking about? Well, it’s hard to tell not knowing the specifics of the practice, such as demographics, patient base, etc. However, in general, it’s better to avoid a “draw” since that money can be deducted from your paycheck based on how the schedule shakes out the following day or pay period.

Percentage (%) of Production?

Most practices pay on production or collections (more about collections below!). A percentage of production essentially means that you will be paid on your estimated procedures cost versus waiting for the collections to come in from the insurance companies or when the patient pays.
This is a good sure-fire way to know that you will be paid, it’s quicker than being paid on collections since you are not at the hands of insurance companies to wait for reimbursement.
Note: most companies that pay on production end up paying a lower percentage than those paying on collections since they need to factor in the cost of not being able to collect potentially.

Percentage (%) of Collections?

Similar to being on a production model (as explained above), many practices pay on collections. A collections model is an end all be all way of getting paid, meaning once the insurance companies or patient ends up paying the amount for the procedure(s), you get paid.
It’s the simplest way to pay a Dentist for each practice owner/company, and it’s the cleanest as well.
Note: It may take Dentists a bit longer to get paid since they are at the mercy of the insurance companies, however, most insurance companies take anywhere from two weeks to up to 90 days to pay out, depending on the contract they have with the practice.

Sign-on Bonuses?

They are never paid like the name suggests “upon signing.” They are always paid after you start and never provided in one lump sum.
Most companies split up the payments ranging from one year to three years to ensure longevity for each hire.

Student Loan Repayment?

Companies usually have this paid out also within a course of one to three years, and there typically are monthly production standards that you must hit to be eligible.

I hope you found this article helpful as it’s compiled based on many questions that I have received over the years from dental school students and experienced dentists looking for work or hiring at their practice. Again, there’s no right or wrong way to compensate dentists. The overall goal is to be fair and competitive, and most importantly, to do what works best for your individual company or practice.

Priyanki Amroliwala is Senior Manager, Talent Acquisition at 42 North Dental. Priyanki is a seasoned Talent Acquisition Leader that has been working with 42 North Dental for six years. She is well-known in the dental and healthcare industries, and genuinely has a true passion for what she does! She believes that recruiting is her calling, and her passion and drive make her great at what she does.

Priyanki does talent acquisition/doctor recruiting for 120+ practices across the New England/North East region for 42 North Dental. She focuses on Doctors and Specialists. Priyanki has 15 plus years’ experience most recently in healthcare including the private duty home care and senior care sectors. Priyanki graduated from the University of Baltimore, Merrick School of Business, in 2006, where she holds a specialization in Marketing Communications.

In her free time, she enjoys spending time with her precious family, going shopping, and always trying out new foods at local restaurants! She considers one of her passions to be “at service for others”, which is why she loves recruiting where she services her clients and candidates, and she gets to entertain her family and friends at home on the weekends.