Out-Law Analysis | 05 May 2020 | 8:30 am | 9 min. read
However, dentists face different challenges across the UK, Germany, Ireland, Spain and France, where our analysis has found that the strength of support dentists are getting to help them survive the current public health emergency is mixed.
As David Meisel of Pinsent Masons explains, dental practices in the UK were instructed to cease the provision of all but emergency services on 25 March.
Emergency dental care is to be delivered via telephone and newly established urgent care hubs.
In the UK, health is a devolved issue, but the UK government has confirmed that it will continue to make payments to dental practices carrying out publicly funded work for the NHS in England as it has in the 2019/20 financial year, despite the fact the dental practices have been instructed to stop routine dental treatment.
Private dental practices can furlough their employed staff, and will receive a grant from the government of 80% of the staff’s salary, up to a maximum of £2,500.
Furloughed staff are not able to do any work for the practice. Many dentists in the UK are self-employed, rather than employed. There is a similar scheme, the Self-Employed Income Support Scheme, which self-employed associates can use to claim 80% of their profits up to £2,500 per month. The scheme is not open to businesses making profits greater than £50,000 however, which will exclude a large number of self-employed dentists doing private work.
Many practices in the UK undertake both publicly funded and private work. The guidance in relation to these practices has not been clear, however recent guidance suggests that such practices will receive their NHS payments as previously, and be able to apply for the same schemes as wholly private practices, but only in relation to their privately generated income.
The UK government has confirmed that it intends to deploy members of the dental profession to support the NHS response to Covid-19.
The government has developed a scheme to redeploy dental professionals based upon areas of need within the NHS and the competencies of those being redeployed.
In the short term, dentists are preparing to do all they can to support the NHS in the battle against Covid-19 whilst relying upon continued funding from NHS contract payments, paired with wider government support schemes to survive.
In the longer term, fears exist for the future of many smaller practices. Whilst predominantly NHS funded practices may have stronger financial security through uncertain times, the flexibility and control over pricing of private dentistry may provide a quicker path to profitability.
The impact of this could mean a period of intense M&A activity as larger dental groups seek to acquire practices struggling to stay afloat.
Another avenue which many in the sector will seek to explore is the emerging teledentistry opportunity. With the obvious restrictions facing traditional dentistry for the time being, the remote provision of services may be an opportunity to increase revenues whilst such limitations persist.
Dr. Torsten Bergau of Pinsent Masons explains that dental practices in general remain open for business in Germany, but in most cases do so with reduced opening times and limited treatments available.
Most German states do not explicitly prohibit the provision of dental services, however both local governments and professional associations have recommended limiting treatments to what is medically required, and to postpone treatments wherever possible. An exception is the state of Baden-Württemberg which prohibits all dental services except emergencies. Following protests of dentists and their professional associations, the state government has clarified, though, that all medically required treatments are possible. Cosmetic treatments remain prohibited.
Federal and state governments have set up a number of financial support programs which are available to dentists, as well as other sectors.
Practices with up to five full time equivalents (FTEs) are entitled to one-time payments of up to €9,000, while practices with up to ten FTEs can claim up to €15,000. Practices with up to 50 FTEs can claim up to €30,000. Applicants have to credibly show a lack of liquidity in the upcoming three months. The payment is a non-repayable subsidy.
A furlough scheme is available, if business has decreased by at least 10% and at least 10 % of the employees are affected. This should be the case for all German practices. Dentists can apply for suspension of their tax-prepayments which creates some additional liquidity. Through their principal bank, dentists also have access to loans funded mostly by the state-owned development bank KfW.
The federal government has also published plans to partially reimburse lost revenues for dentists who have lagged behind with financial support plans already in place for other healthcare providers. In addition to the existing support programs, dentists will receive up-front payments of 90% of the revenues they received from health insurance last year. This up-front payment aims to ensure the practices’ liquidity. However, only 30% of the shortfall of revenues compared to last year can be retained, with the exceeding amount to be repaid.
The program has received some criticism, with some pointing out that dentists will be reimbursed partly only for payments received by health insurance, and not for payments made by patients directly. Depending on the structure of a practice, this might only cover 50% of revenues. With the program effectively reimbursing only 30% of the shortfall of these revenues, the coverage of the program is much more limited than it looks at first glance.
No. For the time being the German healthcare system is working well within its capacity limits. There are no plans to ask or force dentists to help with the treatment of Covid-19 patients.
While dentists are still expected to maintain the infrastructure necessary for dental services for the general public, there is a widespread feeling in the sector that it has not been supported by government. There is little to no guidance for dentists on how to balance the continuing treatment of patients with the safety of their employees, let alone their own safety. Practitioner Dr. Peter Sporer has said: "As dentists, also in this crisis we are committed 100% to accept responsibility for the treatment of our patients. However, even five weeks into the crisis we see 0% support from the government."
According to professional organisations, dentists’ revenues on average have decreased by 80%, with some dentists even reporting a decrease of 95%. If government financial support is not implemented quickly and on a sufficient scale, many operators will be forced to cease trading.
The crisis is likely to accelerate the consolidation of the German market, which despite some change in the last couple of years is still in its early stages. In the short term, practices which struggle to overcome liquidity issues will become a target for investors. In the longer term, the crisis could encourage more dentists to join forces with financial investors in order to be in a better financial position should a similar crisis come up, and in order to be able to focus on the treatment of their patients.
Dorian Rees of Pinsent Masons says that any dental practices open in Ireland are only providing emergency treatments. Most dental associates, who are typically self-employed, have been released so emergency work is typically being undertaken by a practice’s principal dentist or owner.
No specific support schemes are available for the dental sector in Ireland, however many dental practices are taking advantage of some of the general supports on offer for small-to-medium enterprises.
These include the Temporary Wage Subsidy Scheme, where the Irish Revenue will refund eligible employers up to 70% of an employee's average net weekly wage, up to €350 or €410 depending on the wage. Self-employed dental associates are also seeking to obtain Covid-19 Pandemic Unemployment Payment of €350 per week from the Department of Employment Affairs and Social Protection. There are also a variety of small, state-funded loans potentially available to indigenous practices.
Potentially – many private dentists have signed up for the 'On Call for Ireland' initiative, where all healthcare professionals from all disciplines who are not already working in the public health service are requested to register to be on call to support health care in Ireland during the pandemic.
Lisa Creaven, owner of Spotlight Oral Care, has said: "Dentistry in Ireland is one of the hardest hit industries by Covid-19. Going to the dentist poses a significant risk of transmission of the virus. A lot of treatments carried out at a dentist’s surgery create an aerosol of droplets which of course is a significant factor in terms of transmission. Most dental practices simply don’t have the appropriate personal protective equipment (PPE) to carry out routine dentistry work and, to my knowledge, almost all dental practices in Ireland are now closed for regular treatment and are just seeing patients who have a dental emergency."
According to Inmaculada Castelló of Pinsent Masons, dental clinics in Spain remain open for emergency treatments only, as instructed by a Health Ministry Decree of 31 March 2020.
Professional organisations have requested that the scope of these treatments be limited due to fears over the lack of PPE and the risk of exposure for practitioners.
No specific support has been provided for the dental sector in Spain. Moreover, as a consequence of having been declared a key sector, with the possibility of continuing to deliver services, the Spanish dental sector is not able to apply for the tax reliefs and employment measures released by the government and the regional authorities within the framework of Covid-19.
Many dental businesses have requested the suspension of employment contracts, in a similar fashion to UK furloughing, due to the unavailability of PPE needed to provide dental services at this time.
The consequence of these measures is that it is likely that many dental businesses will face bankruptcy as a result of the Covid-19 crisis.
No. There is no intention for the time being to deploy dentists on the frontline. Dental businesses have only been requested to provide hospitals with their protection equipment when it is not used.
The chairman of the Spanish Dental Society, Dr. Óscar Castro, has said: "The situation is extremely critical. Before the state of alert was declared, the dental clinics have been suffering from lack of protection equipment to treat the patients. In fact, the Health Ministry has requested the dentists to donate our protection equipment to hospitals and primary health centres, which we have made to respect our ethic commitment and to support the health professionals in the frontline. However, the Government should be aware that dentists cannot continue with our services in these conditions, highly exposed to the virus considering the circumstances of the practice."
The future for dental businesses will be affected as other sectors. The future will depend on the ability of the businesses to find liquidity to supersede the pandemic situation, which will not be easy. This may cause big dental businesses to find other shareholders to invest funds and small dental clinics to start a process of consolidation.
All dental practices in France have been closed since 12 March as a result of Covid-19, Catherine Mandon of Pinsent Masons explains.
Emergency phone systems have been set up for patients with urgent care needs.
No specific support has been provided to the dental sector by the French government.
In France, dentists are typically either self-employed or are employees of dental centres. Dentists can benefit from the same measures as others: employees can benefit from partial unemployment – allowing employees to remain in the company with part of their salary paid by the French State, and have the possibility to negotiate the repayment schedule of tax and social charges. They can also benefit from interest free loans un to a maximum of €40,000 and from the postponement of bank loan repayments.
No plans currently exist to redeploy dentists to the front line.
The French government has announced plans to begin easing restrictions from 11 May, however details of the "exit plan" have not yet been published and so how it may relate to the dental sector is as yet unclear.
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