The Australian Dental Market Landscape
Having healthy teeth, mouth and gums is important for your general health and wellbeing. It means you can eat, drink, and speak without pain or discomfort.”
(https://www.health.gov.au/topics/dental-health)
In Australia, only 39% of adults visit a dentist every 12 months and more than 90% of adults and 40% of children will have tooth decay during their lives.
(https://www.health.gov.au/sites/default/files/documents/2022/04/healthy-mouths-healthy-lives-australia-s-national-oral-health-plan-2015-2024.pdf)
And yet, dental services are not included under the Medicare umbrella.
Why?
Quite simply because of the cost implications and a ‘belief’ that it was ‘better’ suited to private healthcare insurance.
Over the past 15 years there has been an increase in the number of corporate dental groups operating in Australia. This mirrors the rise of corporate medicine in the GP sector and may provide attractive options for dentists. The rise of corporate dental groups has been one of the evolutionary features of the Australian market in the past 15 years.
The dentistry market (https://www.ibisworld.com/au/industry/dental-services/613/) in 2024 was estimated to be worth $12.9 billion.
In 2022 there were 19,600 registered dentists in Australia and the majority of dentists worked in group private practices (around 9,800) or solo private practices (around 4,700). This accounts for approximately 84% of all employed dentists.
It’s difficult to accurately measure the number of corporate entities and their size in terms of practices owned and dentists employed. However, estimates place corporate ownership at about 12 per cent of the circa 7000 dental practices in Australia, and this is up from about six per cent a decade ago (https://www.bitemagazine.com.au/how-the-corporate-dental-model-is-expanding/
Corporatisation of Dental Health.
The Dental Service Organisation (DSO) market for Australia and New Zealand was estimated to be US$4.09 billion in 20231. That’s AU$6.42 billion as of February 2025. The Compound Average Growth Rate (CAGR) is forecast to be 18% from 2024 to 2030, and the primary drivers are increasing expenditure on dental care and the pervasiveness of (largely preventable) dental conditions.
Like the GP medical market, DSO’s can be an attractive option for sole operator and small group dental practices because they offer efficiencies and supplier cost advantages accruing from a larger scale enterprise. A multi-site footprint also increases options for patients, offering convenience and standardised services that are close to home- particularly in urban areas.
Australia directs 50% of its $1.3 billion funding to private insurance rebates2, meaning, people who cannot afford private insurance are often left out. Over the past decade, premiums have increased north of 3% a year, however, the most compelling statistic is that only 54.6% of the population have some form of general treatment cover. (APRA; 31 March 20243)
As a reminder dental treatments are not covered by Medicare.
The DSO model appeals to dentists at every stage in their career.4
In the US, an estimated 18% of new dentistry graduates intend to work for a DSO. They have education debt to pay off and are entering an expensive housing market and an even more unaffordable rental market. Stability of income increases their ability to service their loans and, over time, may make them more appealing loan applicants. The trade-off between a known income and the uncertainty of starting a practice or buying into a small group practice has its advantages.
Mid-career, DSOs are able to liberate equity, reduce administration and allow for more time with patients. There isn’t a one-size-fits-all dental lifestyle as growing compliance burdens, cyber security threats and regulation steal time from the more satisfying practice of treating people.
An equity payout could also be put towards housing or savings for future expenses such as children’s education.
For Dentists considering life after dentistry, DSO offerings include an equity payout to fund their post career lifestyle, effective tax planning and payout options (e.g. lump sum or annual distributions). For practitioners wishing to continue practice, flexible working arrangements and reduced hours can be combined with a series of equity payments.
Positive impacts of Dental Service Organisations (DSOs)
Part or full equity liquidation that’s easier to implement than traditional “buy-sell” arrangements.
Flexibility for practitioners to focus on patient care; more face-to-face clinical time.
Reduced administration, compliance, and regulatory burden.
A stable income stream for new dentists
Investment opportunity through a shareholding in a larger publicly listed or privately owned organisation.
Negative impacts of DSOs
Mismatch of culture; corporate versus small business.
Less autonomy in the running of the business and/or clinical restrictions.
Deterioration in patient satisfaction driven by price increases or lower staff morale.
Profits prioritised ahead of quality care and clinical excellence.
Conclusion
In Australia, there is a growing unmet need for access to affordable dental services to avoid downstream costs to the hospital system where the most common acute PPH was Dental conditions (87,400 hospitalisations, or 25% of acute PPHs (AIHW 2023)
Selling a dental practice is a once or maybe twice in a lifetime event. It fundamentally changes the balance between personal and clinical life and impacts employees and patients.
Engaging a specialist health sector advisory firm helps to simplify the process, ensure all the details are covered, and provides clinic owners with comprehensive data on which to base decisions.
Piper Health can help identify the potential pitfalls that occur when profit motives overshadow the human aspect of medical practice. Mismatched expectations, motivations, and cultural differences can lead to partnership failures. Moreover, protracted due diligence and valuation processes can leave dental practice owners distressed and fatigued.