Pros of Owning a Rural Dental Practice

By David Haynes, MBA, Vice President of National Practice Sales

In recent years, rural areas have become increasingly attractive to dentists. The COVID-19 pandemic has enabled more people to work remotely, and rising inflation has caused more people to seek more affordable housing. As a result, we have seen more people leaving crowded areas and relocating to rural locations.

These population trends benefit rural dental practices and are causing more dentists to consider practicing in rural markets. Here are some pros of owning a rural dental practice and other information to consider as you evaluate different markets:

What is considered a rural dental practice?

For the sake of the discussion, rural dental practices will be defined as those in population centers of less than 50,000 people or more than 30 minutes outside a larger metropolitan area.

What are the financial benefits of owning a rural practice?

Rural practices provide owners with more opportunities to purchase the real estate that the practice occupies. Property costs are lower in rural areas, and owning your real estate provides fixed real estate costs, tax advantaged depreciation, and building interest expense.

Practices in rural areas also have lower expense structures, including employee costs. You could also potentially receive higher reimbursement rates if you participate in state Medicaid programs. If you are the only dentist offering Medicaid in a small town, you are in a better position to negotiate reimbursement rates.

What are other benefits of practicing in a rural area?

Smaller towns have other benefits for dental professionals, including:

• Less practice saturation and less competition
• Ability to generate a loyal patient base
• Less traffic on your commute
• More affordable homes with more space than in metropolitan areas
• Close-knit communities with many opportunities to get involved

Am I prepared to own a rural practice?

Here are a few considerations: Successful dentists in these areas typically have a fairly broad skill set to support the community’s dental needs. If you lack certain skills, sellers in these locations may be more likely to support and mentor post-close to enable you to take CE and build specific skills.

Valuations are typically lower in rural areas, which is usually offset by the higher cash-flow that the owner will enjoy over their career. If managed wisely, the higher cash flow can put the selling dentist in a much better financial position for retirement than dentists practicing in a higher cost area.

Dentists with military experience are often welcomed in rural communities, and they are typically trained on a wide range of procedures. Military dentists also have lower personal debt, which opens the door for a wider range of purchase options.

Owning a rural dental practice can provide you with many benefits. To get started on your practice search, check out our available listings.