Stabilizing Before the Storm: A Dental Group’s Plan for Economic Resilience

Recessions impact more than revenue—they strain patient schedules, increase cancellations, and put fixed costs under a microscope. This case study explores how a multi-provider dental group took early action to stabilize its financials, optimize staffing, and prepare for volume shifts—turning potential panic into preparedness.

The Company Profile

• Type: General dentistry and orthodontics
• Size: 3 locations, 5 providers
• Revenue Model: 80% PPO insurance, 20% cash-pay and membership plans
  
  

Primary Vulnerabilities:

• High fixed overhead (salaries, equipment leases, facility costs)
• Reliance on elective procedures for margin
• Debt scheduled for refinancing in a rising rate environment
  
  
  

The Approach: Financial Resilience in Four Strategic Moves

1. Locked in Long-Term Debt Terms
Solution: Refinanced practice loan and equipment leases before rate hikes

Key Actions:

• Modeled rising interest scenarios and impact on monthly cash flow
• Paid down high-cost debt using excess Q1 liquidity
• Converted remaining term debt into fixed-rate instruments
  
  

Result: Saved projected $5,800/month in potential future interest costs

2. Workforce Restructure for Flexibility

Solution: Restructured hygiene schedule and front office coverage

Key Actions:

• Cross-trained admin staff for patient coordination and insurance follow-up
• Converted part-time hygienists to per-diem contracts for demand-based scheduling
• Introduced hybrid front desk model with remote scheduling support
  
  

Result: Reduced labor cost by 11% without layoffs or quality loss

3. Patient Volume Strategy for Economic Softness

Solution: Developed demand insurance with retention-focused programs

Key Actions:

• Strengthened in-house membership plan to reduce PPO dependency
• Ran recall outreach for overdue hygiene and ortho visits
• Introduced bundled care packages with upfront payment discounts

Result: Increased Q2 patient retention by 14% during a regional downturn

4. Cash Flow and Liquidity Modeling

Solution: Built a rolling 12-week cash flow forecast

Key Actions:

• Included variable inflow scenarios based on case mix
• Modeled cash reserves needed to cover fixed expenses for 3 months
• Identified timing gaps with insurance reimbursements
  
  

Result: Established a safety net strategy with an internal reserve target

Key Takeaways
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• Recession-proofing starts before the downturn—by securing costs and protecting liquidity.
• Flexibility in staffing and debt structure can help a practice stay lean without cutting corners.
• Membership plans and bundled offerings give patients value—and give practices more predictable revenue.
• A 12-week cash forecast gives visibility that a P&L or tax return simply can’t.