Why We Don’t Outsource to Offshore Resources

Today, when many accounting firms are having trouble hiring skilled talent, many are turning to offshore resources to cut costs and increase profits. However, at E&A, we’ve made a conscious decision not to follow that path. For us, the security of our clients’ data and the quality of our services take priority over increasing profits. Here’s why…

The Value of Data Security

In the dental industry, patient confidentiality and data security are not just essential—they’re legally mandated. As your accounting firm, we handle highly sensitive financial data about your practice, employees, and even your patients. By keeping our operations within the U.S., we ensure that your data is protected by domestic privacy laws such as HIPAA and the Gramm-Leach-Bliley Act (GLBA). These laws provide stringent regulations on how client information should be managed, something many offshore firms may not know about or be subject to. Additionally, we are not willing to risk losing control over where and how your data is handled. Offshore jurisdictions may not have the same level of oversight, enforcement, or cybersecurity standards, which can mean increased vulnerability to data breaches and less accountability.

Maintaining Accuracy and Expertise

When you work with us, all of your accounting work is performed by qualified professionals who are familiar with the dental industry, U.S. tax laws, and other pertinent regulations. It is rare for an offshoring provider to have specialized industry knowledge, which can lead to inaccuracies and missed tax-saving opportunities.

In the world of dental accounting, precision is key, and every dollar matters when managing expenses, payroll, financial planning, and tax strategies. By choosing not to use offshore resources, we maintain a higher standard of accuracy, ensuring that nothing is lost in translation or neglected because someone unfamiliar with U.S. dental practice operations is handling your books.

Knowing Where Your Data Is At All Times

One of the benefits of working with us is knowing exactly where your data is stored and who is handling it. Offshore companies may not have the same level of security, so if a data breach occurs, who is responsible? How is your data being stored, and in which country’s jurisdiction does it fall? With our firm, there are no unknowns. Your data stays secure within the U.S., where it is subject to strict privacy regulations.

Choosing Security Over Profits

It’s no secret that offshoring can significantly reduce costs. However, we believe that the potential security risks, coupled with the loss of control over data, are simply not worth it. By keeping our work in-house, we may not maximize profits the same way firms using offshore labor do, but we offer our clients something much more valuable: peace of mind.

We’ve invested in state-of-the-art cybersecurity measures to protect your sensitive financial information, and our team is well-trained and vetted, so you can feel confident that your practice’s financial health is in safe hands.

Why This Matters to Dental Practices

As a dental practice owner, your focus should be on providing top-quality care to your patients. You shouldn’t have to worry about the safety and accuracy of your financial records. By choosing an accounting firm focused solely on those in the dental industry that doesn’t offshore its work, you’re choosing a partner that values security, precision, and transparency as much as you do.

If you want more information about how we safeguard your data and offer the best accounting services for your dental practice, feel free to contact us today. We’re here to help you build a stronger, more secure financial future.

Key Real Estate Mistakes to Avoid When Expanding Your Dental Practice

When facing real estate transitions, whether purchasing, selling, or relocating a dental office, it’s essential to work with a professional who understands the specific needs of healthcare practices. In a recent episode of Beyond Bitewings, Jennifer Page from Carr Real Estate discussed the importance of engaging a healthcare-specific real estate agent early in the process to avoid common pitfalls.

First, avoid working with agents who represent landlords or sellers. Jennifer highlighted that many dental professionals mistakenly reach out to the agent whose name is on the property listing, unaware that this agent has a fiduciary responsibility to the landlord. This is akin to having the opposing party’s lawyer represent you in court—not exactly a recipe for success!

To ensure fairness and avoid conflicts of interest, Jennifer emphasizes the need for tenant or buyer-exclusive agents, particularly those who understand the intricacies of healthcare practice spaces. This includes knowing how to negotiate better lease terms, finding spaces that fit the unique needs of a dental office, and properly timing the process. Waiting until the last minute or rushing real estate decisions can lead to poor leases or missed opportunities, so starting the process at least a year or more in advance is key.

Another invaluable tip from the episode is to always negotiate multiple properties at once to keep your options open. Dental practitioners can leverage competition between landlords to secure the best possible deal.

Working with a healthcare real estate firm, such as Carr Real Estate, can give you access to an extensive network of healthcare-specialized agents who can provide no-cost guidance to the buyer or tenant. By securing this type of expertise, dental practices can secure optimal locations with the best terms, allowing business owners to focus on patient care instead of real estate headaches.

To listen to the Beyond Bitewings episode, click here. For more tips and to connect with healthcare-focused agents, contact us for expert advice.

IRS Opens Second Employee Retention Credit Voluntary Disclosure Program

The Employee Retention Credit was created to provide financial relief of up to $26,000 per employee to businesses that retained employees by subsidizing wages during the pandemic. However, many businesses, including dental practices, fell prey to aggressive marketing by deceitful companies that intentionally misled people into believing they were eligible for these credits when they were not. A promise of free money is hard to turn down, so many businesses decided to take the gamble that the IRS would not catch up to them while others unknowingly claimed the credit that did not qualify.

Once the IRS started looking into these claims, they found that up to 90% of them contain some type of fraud and sent more than 25,000 disallowance letters to claimants as of early August 2024. But also knowing that many businesses were duped into filing ERC claims, they launched a voluntary repayment program that ended in March 2024. Now, the IRS has launched a second ERC voluntary disclosure program with a deadline of November 22, 2024, so businesses can correct their mistakes and avoid potential audits, fines, and requirements to repay the credit. 

Common warning signs

Dental practices that claimed ERCs should carefully reassess their claims, especially if third-party firms assisted with the filing. Common red flags that could indicate a fraudulent ERC claim include:

  1. Practices that remained fully operational and did not experience a significant decline in gross receipts may not qualify for the ERC. 
  2. Some businesses misunderstood what constitutes a full or partial suspension under a government order, and many of the ERC mills relied on this confusion. Simply facing challenges during the pandemic doesn’t qualify as a suspension. Dental practices were considered “essential businesses” in almost every location and were not subject to many of the closure mandates.  Therefore, this aspect applied for a very limited period and a few limited geographical locations during 2020 only. If your claim was based solely on a full or partial suspension, your ERC may be considered erroneous.  
  3. Claiming wages paid to family members can lead to problems, as these claims are often ineligible or calculated incorrectly.
  4. Wages that were counted towards PPP loan forgiveness cannot also be claimed for ERC. Double-dipping in this manner is a common error.

What to do now

If you are concerned that some or all of your claim may not be accurate, we encourage you to do the following:

  1. Review your claims: It’s essential to thoroughly review all ERC claims to ensure compliance with IRS rules and all claimed quarters and wages meet eligibility requirements.
  2. Reach out to us: We understand the complexities of the ERC, can provide guidance on the voluntary disclosure program, and can help you correct any errors in past claims.
  3. Participate in the disclosure program: If you suspect your practice may have claimed the ERC incorrectly, consider enrolling in the IRS’s voluntary disclosure program before the November 22, 2024, deadline. This proactive step can help you avoid future interest, penalties and even up to five years in jail.
  4. Stay updated: Tax regulations are constantly evolving. We will continue to provide you with the latest updates on ERC rules and other relevant tax credits, but if you have specific questions, don’t hesitate to call us.

Correcting ERC claims through the voluntary disclosure program can prevent more severe consequences down the line. Not only does this protect your practice’s finances, but it also maintains your credibility and trustworthiness as a business. Don’t wait until it’s too late – review your ERC claims and ensure your practice complies with IRS guidelines. If you need assistance, our team is ready to help.

Improving Dental Practice Profitability

In the latest episode of Beyond Bitewings, Ash is joined by Jessica Jones, the CEO and founder of Build Your Cash Medical Practice. Jessica shared her unique insights into the medical and dental industries, drawing from her extensive experience in helping struggling practices grow into successful, multi-location clinics. Her career began in the 90s within a national marketing company, which eventually led her to working closely with medical practices, helping them convert leads into enrolled patients. This laid the foundation for her later ventures in building and scaling practices.

Jessica emphasized the importance of adapting to changing business environments, a principle that resonates strongly with dental practice managers and dentists. She stressed that what worked in the past may not necessarily be effective today, particularly in a rapidly evolving field like healthcare. Jessica highlighted the necessity of staying attuned to external factors—whether they be regulatory changes, technological advancements, or shifts in patient demographics—that can significantly impact a practice’s success.

One of the key takeaways from the discussion was the importance of delegation and the need to step back from day-to-day operations to focus on strategic growth. Jessica pointed out that many practice owners get bogged down by the minutiae of running a practice, which can prevent them from seeing the bigger picture. By delegating tasks to the right team members and allowing them to take ownership of their roles, practice owners can free up valuable time to focus on business development and patient care. This, in turn, can lead to better patient experiences and overall growth for the practice.

Jessica also discussed the value of integrating cash-based services into dental practices. By offering services that are not covered by insurance, such as esthetic treatments or sleep apnea devices, dental practices can diversify their revenue streams and reduce reliance on insurance reimbursements. This approach not only boosts the financial health of a practice but also provides patients with more comprehensive care options.

Moreover, Jessica underscored the importance of cultivating strong relationships with patients. She advised that personalized care and attention to detail can significantly enhance patient satisfaction and loyalty. For instance, something as simple as remembering personal details about a patient can make them feel valued and increase the likelihood of them returning and recommending the practice to others.

In conclusion, Jessica’s insights provide valuable guidance for dental practice managers and dentists looking to optimize their operations, better engage with patients, and explore new avenues for growth. By focusing on both the quantitative aspects of practice management and the qualitative elements of patient care, dental practices can achieve sustainable success in an increasingly competitive field.

Noncompete Agreements Get Reprieve

Following the Federal Trade Commission’s (FTC) noncompete agreement ban has been quite a ride. In our last article on this issue, we discussed how dueling rulings were leading to confusion. Some of that confusion was cleared up yesterday, August 20, 2024, when U.S. District Judge in Dallas, Ada Brown, blocked the FTC’s proposed ban.

This ruling comes after the U.S. Chamber of Commerce and Ryan LLC challenged the FTC’s authority to enforce such a broad prohibition. Judge Brown stated that the FTC lacked the necessary evidence to justify a sweeping ban on noncompetes, deeming the rule as arbitrary and capricious. The ruling is seen as a victory for businesses that argue noncompetes are essential for protecting trade secrets and maintaining competitive balance. The FTC, which had aimed to implement the rule by September 4, is now considering an appeal, emphasizing that the decision does not prevent them from addressing noncompete issues on a case-by-case basis.

For dental practices, this ruling highlights the ongoing debate over noncompete agreements and their role in the workforce. As the situation evolves, it is crucial for dental practice managers to stay informed and consult with experts to understand how this might impact their hiring and employment practices. While the immediate threat of a blanket ban has been halted, the legal landscape surrounding noncompetes remains complex and could see further changes depending on future appeals or legislative actions.

In the meantime, dental practices should review their existing noncompete agreements to ensure they are fair, reasonable, and compliant with current laws, and consider the potential impacts on employee retention and competition in the industry.

Strength in Numbers: The Value of Our Dental Network for Your Practice

When you partner with Edwards & Associates, you’re not just getting top-tier financial and accounting expertise tailored to dental practices. You’re also gaining access to our extensive network of industry vendors. Over the years, we’ve cultivated relationships with a variety of trusted service providers, from attorneys to dental supply companies to human resources specialists, ensuring that our clients have everything they need to run a successful practice.

The Power of Connection

In the dental industry, having the right connections can make a significant difference in how efficiently your practice operates. Whether you’re looking for the best deals on equipment, seeking advice on practice management software, or need a reliable contractor for office renovations, or if you want to drop some insurance contracts but aren’t sure which ones, our network is here to support you. These connections aren’t just random business cards we’ve collected—they’re trusted professionals we’ve worked with closely, in most cases, for years, who understand the unique needs of dental practices.

The Added Value of Our Network

Partnering with us means you’re not just hiring an accountant; you’re gaining a team that’s committed to your entire practice’s success. Our network allows us to go beyond traditional accounting and financial services, offering you a holistic approach to managing your business. 

For instance, if you’re struggling with the administrative side of your practice, we can connect you with consultants who specialize in creating efficient systems and streamlining workflows. Need help handling the complexities of dental insurance? We’ve got contacts who can tell you which insurance contracts to stay away from and which ones to accept, explaining why in both cases. Or maybe you need a loan to purchase new equipment or expand your space? We know where you can get the best rates, and it is not always with a local bank. Our membership in the Academy of Dental CPAs allows us to create relationships with dental-specific lenders nationwide – and we are happy to connect these lenders with our clients. 

This extensive network is one of the reasons our clients stay with us for the long term. They appreciate that we’re not just focused on their books; we’re focused on their business as a whole. Our network provides value that goes beyond the numbers, helping solve challenges that may not even be on your radar yet.

Why This Matters

In an industry as specialized as dentistry, it’s crucial to have vendors and service providers who understand the intricacies of your field. Working with a generalist may save a few dollars in the short term, but the expertise you gain from specialized vendors can lead to better outcomes and fewer headaches down the line. Our carefully curated network ensures that you’re always working with professionals who know the dental industry inside and out.

We believe that our clients deserve more than just excellent tax, financial and accounting services – they deserve a partner who’s invested in their overall success. Our extensive dental network is a testament to that commitment, providing you with the resources you need to run a thriving practice. When you work with us, you work with a team that’s dedicated to helping your practice grow, succeed, and meet the challenges of an ever-evolving industry.

Solving Common Dental Practice Challenges with Virtual Assistants

In a recent Beyond Bitewings episode, Beth Lachance, the founder and CEO of Global Medical Virtual Assistants, joined the discussion to share insights on how virtual assistants are transforming the operations of dental practices and highlighted the growing trend of remote staffing as a solution for the administrative challenges faced by dental professionals. Her company specializes in providing virtual assistants who manage tasks like front desk operations, insurance verifications, and revenue cycle management, which are crucial yet time-consuming for practice owners.

Beth emphasized that many dental practices struggle with the demands of running a business while trying to focus on patient care, a topic we cover frequently on Beyond Bitewings. The administrative burden often falls on front desk staff, leading to inefficiencies and potential burnout. Virtual assistants offer a way to offload these tasks, allowing in-house teams to focus on patient care and improving the overall efficiency of the practice.

One of the key points Beth made was the cost-effectiveness of using virtual assistants – who can cost significantly less than employing full-time, in-house staff – without sacrificing quality. These virtual assistants are often dedicated exclusively to the practice they are assigned to, ensuring consistent and personalized service.

Moreover, virtual assistants can help practices scale more effectively by managing the administrative workload, thereby freeing up resources for growth. This is particularly important in the post-COVID era, where staffing challenges and rising operational costs have made it difficult for many practices to maintain profitability.

Beth also addressed concerns about the personal touch in patient care, assuring listeners that her virtual assistants are highly trained professionals who can seamlessly integrate into the practice’s workflow, just like any other remote employee. 

The episode provides valuable insights into how dental practices can leverage virtual assistants to streamline operations, reduce costs, and improve patient care. For dental professionals looking to optimize their practice management, exploring virtual assistance could be a game-changer. If you are interested in learning more, you can download Beth’s book, Best Tasks to Delegate to a Medical Virtual Assistant, on their website.

Understanding the New IRS Rules for Retirement Account Withdrawals

The IRS has made important changes to how you must withdraw money from your retirement accounts. Knowing these new rules is important for good tax and financial planning. Here’s a simple overview of what’s changed and what it means for you.

Key Changes in the Rules

  • Raising the Age for Withdrawals: In the past, you had to start taking money out of your retirement accounts at age 70½. This was later moved to age 72, and now, starting in 2023, it’s been moved to age 73. In 2033, this age will increase to 75. These changes give you more time to grow your savings before you have to start taking money out.
  • Changes for Inherited Retirement Accounts: Before, if you inherited a retirement account, you could spread the withdrawals over your lifetime. Now, if you inherit an account, you might have to empty it within 10 years. This rule applies to accounts inherited after December 31, 2019.
  • Who Is Affected by the 10-Year Rule?: The 10-year rule mostly applies to people who aren’t considered “eligible beneficiaries.” Eligible beneficiaries include spouses, minor children, disabled or chronically ill individuals, and those close in age to the person who passed away. If you’re an eligible beneficiary, you can still spread the withdrawals over your lifetime. If not, you’ll need to withdraw all the money within 10 years.
  • Annual Withdrawals: If the original account owner had already started taking money out, the person inheriting the account will usually need to continue taking money out each year. This prevents you from letting the money grow for 10 years and then taking it all out at once.

What Should You Do?

  • Update Your Beneficiaries: Make sure your retirement accounts list the right people to inherit your money according to your wishes.
  • Consider Roth IRA Conversions: Converting traditional IRAs to Roth IRAs might help your heirs save on taxes. Roth IRAs don’t require withdrawals during your lifetime, and your heirs can withdraw the money tax-free.
  • Plan for Taxes: The new rules can make taxes more complicated. Planning ahead can help you avoid paying too much.
  • Think About Using Trusts: Setting up trusts can give you more control over how your money is distributed to your heirs.

These changes bring new opportunities and challenges, so careful planning is important. For advice tailored to your situation, contact us. We specialize in helping people like you navigate these rules and make the most of your retirement savings.

FTC’s Non-Compete Ban: Dueling Court Rulings

Keeping up with the Federal Trade Commission’s (FTC) rule banning most non-compete agreements is nearly a full-time job. We initially wrote about it here, then published an update here, and now we have even more information to share. 

Overview of Original Non-Compete Ban Ruling (April 23, 2024)

On April 23, 2024, the FTC announced a final rule that prohibits employers from entering into non-compete agreements with workers, including senior executives, after the rule’s effective date of September 4, 2024. The rule also renders existing non-competes unenforceable for most workers, with exceptions for senior executives and agreements made as part of a bona fide sale of a business. The FTC’s decision was driven by findings that non-compete clauses suppress wages, stifle innovation, and hinder new business creation. The FTC estimates that the ban will lead to a 2.7% annual increase in new business formation, higher worker earnings by an average of $524 per year, and significant reductions in healthcare costs.

Ruling 1: Northern District of Texas Ruling (July 3, 2024)

U.S. District Court Judge Ada Brown in the Northern District of Texas granted a preliminary injunction against the FTC’s non-compete ban, preventing the FTC from enforcing the rule against the plaintiffs (Ryan LLC and several trade associations, including the U.S. Chamber of Commerce.) The court found that the plaintiffs were likely to succeed in arguing that the FTC lacks statutory authority to issue the rule and that the rule is arbitrary and capricious. However, this injunction is limited to the named plaintiffs and is not a nationwide injunction. 

Ruling 2: Eastern District of Pennsylvania Ruling (July 23, 2024)

In contrast to the Texas ruling, Judge Kelley Brisbon Hodge of the U.S. District Court for the Eastern District of Pennsylvania upheld the FTC’s authority to issue the non-compete ban. In this case, the court found that the FTC does have the authority to issue such a rule and ruled against the plaintiff, ATS Tree Services LLC. 

What is Next?

These conflicting rulings create uncertainty about the future of the FTC’s non-compete ban. The Texas court has indicated it will issue a final order on the merits by August 30, 2024, just days before the FTC’s rule is scheduled to go into effect on September 4, 2024.  Regardless of what the Texas court does at the end of the month, it is likely that these cases will continue through the appeals process, eventually leading to a resolution at a higher court level.

For dental practices, this situation creates uncertainty. We will continue to monitor these developments closely and provide updates on any further movement or rulings.

FTC Non-Compete Rule Halted: Key Insights for Dental Practices

Recently, a significant development emerged for dental practice owners and administrators: the Federal Trade Commission (FTC)’s proposed ban on non-compete agreements has been temporarily paused. This delay, issued by U.S. District Court Judge Ada Brown in the Northern District of Texas, postpones the rule that was initially set to take effect soon. (You can read the post we wrote about this rule when it was announced here.)

The FTC’s Rationale

The FTC’s proposed rule aims to promote labor mobility and enhance wage growth by eliminating non-compete clauses that restrict employees from changing jobs. The FTC argues that these agreements inhibit innovation and economic growth, impacting nearly 30 million Americans. The proposal received broad public support, with many advocating for a national standard to supersede restrictive state laws.

Business Community Concerns

On the other side of the coin, the rule encountered significant opposition from the business community. Organizations like the U.S. Chamber of Commerce contend that the FTC has overreached its authority, arguing that non-compete agreements are vital for protecting proprietary information and maintaining business stability. These agreements are seen as crucial for fostering investment in employee training and protecting business interests.

Potential Disruptions

Legal challenges emphasize the potential economic and operational disruptions the rule could cause. Critics highlight that implementing the rule could lead to substantial upheaval across industries, suggesting that the FTC’s approach is too aggressive. They advocate for a balanced solution that considers both worker mobility and the contractual protections businesses rely on.

Implications for Dental Practices

For dental practices, the impact of this rule is particularly pertinent. Non-compete agreements are frequently used to protect sensitive business information and keep employees from approaching former patients when they leave a practice or open their own. Eliminating these agreements could force dental practices to rethink their hiring and retention strategies.

Looking Ahead

The Supreme Court’s Loper Bright Enterprises v. Raimondo finding in June could also impact the legality of this FTC rule since it shifted how courts interpret the statutory authority of federal agencies. The outcomes of these cases will likely set important precedents for federal regulation of employment practices, affecting how non-compete agreements and other contracts are managed.

We are committed to helping our dental practice clients understand these regulatory changes and will continue to provide updates on any developments that may impact your practice. 

Ideas for Independent Dental Practices Competing Against DSOs

In this, the second of three podcast synopses discussing some of the biggest issues facing dental practices today, we focus on ways that smaller practices can differentiate themselves from corporate providers. (Go here to read the first post in this series, and here to listen to the podcast episode on which this article is based.)

In a dental market increasingly dominated by Dental Service Organizations (DSOs), small practices need strategic advantages to remain competitive. DSOs leverage economies of scale, enabling them to access lower costs and broader resources, making them formidable competitors, particularly in terms of pricing and operational efficiencies. However, independent dental practices can distinguish themselves by focusing on quality, personalized service, and building a positive workplace culture.

One way they can do this is by offering exceptional customer care, something that might be diluted in larger corporate settings. This involves training staff not just in dental skills but in customer service excellence. For example, staff can make a notable difference by remembering personal details about patients – like upcoming vacations, recent marriages or births, or promotions at work – which can be noted in their profiles and mentioned during visits to create a more welcoming and personalized experience. 

Moreover, fostering a strong workplace culture is vital. Independent practices often offer a more intimate setting where employees can feel genuinely appreciated and part of a team, unlike in some larger organizations where they might feel like just another number. This can be enhanced by providing opportunities for professional development, recognizing employee contributions, and ensuring that work-life balance is respected. Practices that invest in their teams not only improve morale but can also see increased patient satisfaction, as happy employees are more likely to provide better service.

Independent practices can also differentiate themselves by focusing on the qualitative aspects of their services. This includes the way they manage patient relationships, the atmosphere of the office, and how they handle patient communications and follow-ups. Practices might consider adopting advanced customer relationship management (CRM) systems to manage these aspects more effectively, ensuring that every patient interaction is as personalized and engaging as possible.

Incentivizing staff through performance bonuses linked to patient satisfaction and online reviews is another strategy. This not only motivates staff but also helps in building a positive online presence, which is crucial to attracting new patients. Offering unique services that DSOs may not provide, such as boutique cosmetic procedures or advanced patient education sessions, can also create patient “stickiness” and encourage them to refer you to their friends and colleagues.

Finally, embracing technology is crucial. This doesn’t mean only investing in new dental technologies but also improving the digital experience for patients. Ensuring that online booking is seamless, enhancing the practice’s website, and utilizing social media effectively can significantly enhance a practice’s visibility and appeal.

By focusing on these qualitative differentiators, independent dental practices can carve out a niche in an industry increasingly inclined towards consolidation. This approach not only helps in competing with DSOs but also in building a loyal patient base that values quality and personal touch over cost alone.

At Edwards and Associates, we take pride in the fact that we know the dental industry so well. And while we focus on your practice’s financial health, we know others that provide myriad other services and are happy to make referrals that will enhance your service delivery. Reach out to us if we can help in any way!