Model for cost‐containment planning in dental clinics

Abstract

Cost-containment possibilities in dental clinics present complex challenges to dental clinic management in the 1980s. A hypothetical model using mean cost components has been presented, together with strategies for cost reduction. Although clinical cost management is a complex task, these costs are the most significant and manageable in the dental school. Clinical cost containment is related to curriculum, faculty ego, staff morale, and many other factors separate from clinic operations. Rational cost containment requires a thorough understanding of the relative value of various costs and of the interrelation of costs, as well as firm commitment to control these costs by responsible faculty, particularly the dean. The escalating effect of uncontrolled clinical costs may result in the financial downfall of some schools in the 1980s. The observation that in the average dental school costs exceed income by a factor of approximately 3.5:1 (with an estimated range of 2:1 to 30:1) suggests that cutting costs in many schools may be more effective than raising clinic income. With inflation, the effect of the predominant cost factor versus income becomes more significant over time.