CBCT and your CPA! Cone Beam in the Dental Office - Return on your Investment

Cone Beam Computed Tomography (CBCT) is becoming a popular tool for specialists and general practitioners.  There is a massive amount of clinical data to help you decide if this is appropriate for your office. Although, we don’t comment on the clinical aspect of technology in the dental office, as a dental tax and accounting firm, we have a specific perspective on investing in technology: Return on Investment

 

We attended the Chicago Midwinter Dental meeting to learn more about technology for our clients. We met the crew from Vatech and they were awesome to help us understand the ROI.   The following images were taken using a Vatech - Pax-I Green 2 16x9.  This unit provides highly diagnostic 2D and 3D images with very little radiation to the patient. The consultants from Vatech explained both the practice and patient benefits in detail.

 

Most dentists have a specific reason for investing in a CBCT.  For instance, a general practitioner might just be starting to place implants. This GP is concerned about hitting the IAN (Inferior Ale velar Nerve), penetrating the cortical plate, or entering the sinus.  Maybe this GP is engaging a lot of anterior endodontics, wanting to work more on posterior teeth; however, they are afraid of missing MB2 (mesiobuccal canal).  For those practitioners - CBCT is an excellent tool – but how they will pay for this unit?

 

CBCT scans are generally not covered by dental insurance yet and many dentists are not billing medical insurance.  CBCT machines can run from as low as $50,000 to as high as $150,000.  In terms of monthly payments - a $50,000 machine for 3 years at 6% will have a monthly payment of about $1,525.00 per month.  A $150,000 machine for 8 years at 5% has a monthly payment of about $1,900 per month. Remember those monthly payments as we’ll come back to that.

 

Now that we’ve reviewed a few of the clinical conversations, let’s look at potential revenue with CBCT now that it’s in your chest of tools. From a tax perspective, there are depreciation benefits; however, be careful not to let the tax “tail wag the dog”. This must still make sense for your practice, your patients, & your skillset first. 

 

Let’s say you are Married Filing Jointly just inside the 35% tax bracket – so taxable income is at $415k, a number conveniently spot on the $415k QBI 20% Deduction phaseout.  If you consider a CBCT machine at $100k (middle of the range,) you could opt for Section 179 depreciation, Bonus depreciation, or depreciate it over 5 years.   Don’t automatically assume taking all the depreciation in year one is the best option.   If you opt for Section 179 or Bonus depreciation, there is about $32k tax savings right off the bat, but there is also the 20% QBI deduction you are now eligible for with the lower income. With the practice income lower, you could now deduct $63k ($315k x 20%) from your taxable income, another $20k of tax savings ($63k x 32% tax bracket). With these facts & circumstances, you have saved $52k in taxes & increased your opportunity to increase your collections with increased productivity. That is about 45% ROI (including interest expense) just off the depreciation benefits, and the final ROI will be calculated over the next few years as you use the equipment to increase your production.

 

The Journal of Endodontics recently published a study that showed that 87% of the radiology scans that they evaluated had secondary findings.  OMF Radiologists anecdotally tell us the same thing.  In scans they evaluate, there is almost always something else to treat in the scan.  So, the ROI is really based on your process for treatment and protocol.  If you scan 10 people, will may likely find 7 or 8 instances of undiagnosed pathology.  

 

This doctor was looking at the 2 maxillary edentulous sites to determine if he could place implants . . .

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He determined he could in place of #12.  He showed the patient - and the patient agreed to move forward at $1,000 for the implant and $1,500 for the restoration.

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The edentulous site at #2 would require a sinus lift ($500) and then an implant and restoration $2,500.

 

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The endo on #31 is failing (didn’t show up on 2D imaging and was asymptomatic).  A retreat is $500. 

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A quick look at the patients TMJ and Airway indicate an appliance.

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In just this one scan, there is about $14,000 of treatment indicated that may not have been easily identified otherwise. 

CBCT finds pathology that the best-intentioned dentists routinely miss.  For instance, look at the PA below.  Then, look at the cross-sectional view of #9 from a CBCT.  The images are on the same patient on the same day.  The PA shows the fracture that had been there for 12 years.  The CT shows the massive lesion at the apices of #9.

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Attending a dental convention is amazing these days. Digital technology is changing everything: CAD CAM, digital printing, laser technology, oral scanners, etc. are giving dentists the tools to provide better treatment more quickly. With any purchase for the office, calculating ROI prior to the purchase is paramount. It makes sense to get a third party – an expert in dental tax, accounting, and finance - to evaluate these decisions with you as you contemplate the best high-tech for your practice.