The first big, post-sale decision that buyers and sellers of a dental practice will need to make will revolve around patient disclosure. While no one wants to be dishonest with the patient base, there is a fear that, if the sale is communicated poorly, goodwill may not transfer effectively from seller to buyer, and patients may leave the practice. When faced with such dire consequences, some will prefer not to tell the patients anything about the transfer of ownership, and hope to manage the situation “on the fly” if patients ask.

With the stakes of poor communication high, it is important to think carefully about how, when and what (if anything) to tell the patients about the transaction and address this disclosure carefully.

The argument against disclosure

Some argue that people usually don’t know or care who owns equity in the businesses they frequent. Most consumers are blissfully unaware of who owns the café where they buy their coffee or their lunch. Most don’t know or care who owns the medical centre that they see their doctor in, or the accountancy firm on the letterhead that their accountant uses. People argue that dental patients are equally ambivalent about issues surrounding the ownership of the practice.
Some new owners feel that if the patient base found out about the change of ownership, they might approach the practice with suspicion. While they may not care about ownership, they might assume changes in clinical quality, philosophy of diagnosis, range and services, and leave the practice before the new owner has a chance to prove him/herself.

These new owners feel that if they just stay quiet about the change, patients will come in as they always have, and the new owner will get a chance to win them over one at a time.

While these arguments may be valid, this doesn’t mean that there isn’t an argument for disclosure on the change of ownership.

The argument for disclosure…

Often, in the sale of a practice, the vendor will stay on (at least in a part-time capacity). Many feel that without disclosure about the sale, the patient base will not look at the new owner as having any authority. Decisions made by the purchaser on whether discounts given or not, hours of availability, treatment options, etc., could be seen lacking weight and they may seek confirmation from the previous owner, not knowing that he/she is not the owner anymore.
Just because you don’t tell the patients, doesn’t mean that they don’t find out. Once a few people in a community find out, it doesn’t take long for the word to spread. In the absence of information from the practice, the patient base may assume possible negative changes (price increase, quality decrease, etc.). A letter from the practice gives the ownership a chance to put minds at ease.
Many patients are loyal to a practice because of the rapport and trust they have with their dentist. When these patients have an appointment to see their dentist, they don’t want to come and find out that their longstanding dentist is unavailable to them and instead they are booked in with someone else entirely…someone younger…obviously less experienced …who they have never heard of before.

When this happens to a patient, they report feeling animosity towards the practice because of the lack of transparency, and the new dentist will often feel that they are on the backfoot, trying to build trust and rapport with a patient base that feels that is has been duped. It’s not an ideal dynamic for anyone involved, and it puts the patient’s loyalty to the practice in jeopardy.

Disclose or not Disclose

A stable patient base (and loyal consumers of any service for that matter) will be naturally resistant to change. Regardless of whether you decide to disclose a change in ownership, it is clear that some level of finesse is needed in order to get a patient comfortable with seeing another dentist in the practice. It is much easier to facilitate this handover if the day you ask the patient to see the new dentist isn’t the first time they have heard of him/her.

A loyal patient will be more open to having an appointment with the new clinician if they have previously been the recipient of a form of communication (letter, email, practice newsletter) that explained who the dentist is and their virtues, with an endorsement from their trusted dentist. 

Here is an example of how a disclosure letter to patients might be structured.

Patient disclosure in a practice sale is a topic that needs serious consideration. Done poorly, or ignored completely, and it could lead to compromises of goodwill…but, if done well, there should be minimum patient attrition and patients should transfer smoothly. A good practice broker should be able to able to help you draft a form of communication that works for your individual situation.

For more Post-Sale articles for a dental practice buyer click here:

• Goodwill and not so good dentistry
• Goodwill transfer in practice sales
• The Vital Role of Staff Post-Sale
• Practice Ownership First Steps – Change Management