The 2025 Dental Business Crunch: 8 Challenges Every Practice Must Face

From Medicaid cuts to staffing shortages, dental practices in 2025 are under pressure. Discover the 8 biggest challenges—and practical strategies to keep your practice thriving.

Introduction

If you’re a dentist running a practice in 2025, you’re probably feeling the squeeze. Shrinking reimbursements, staffing shortages, rising costs, and patients pulling back on elective care are making it harder to keep margins healthy. Add in the growing influence of DSOs and the costs of adopting new technology, and it’s clear: this is a defining year for the business side of dentistry.

At MRL Advisory Group, we work with dentists every day who face these exact challenges. Here’s a breakdown of the biggest business issues in dentistry right now—and what practice owners can do to adapt.

1. Medicaid Uncertainty & Shrinking Profitability

Sun Life, a major player in dental insurance, recently cut its U.S. dental profit forecast due to delays in Medicaid reimbursement negotiations and rising claims. For practices that rely heavily on Medicaid, this signals even more financial strain ahead.

✅ Strategy: Diversify your payer mix and evaluate the balance between Medicaid, insured, and private-pay patients. A dental CPA can help model different reimbursement scenarios so you’re not caught off guard.

2. Patients Pulling Back on Elective Procedures

Align Technology (maker of Invisalign) lost more than a third of its stock value this year, a reflection of patients cutting back on orthodontics and cosmetic care. With financing harder to access, patients are prioritizing “must-do” over “nice-to-have.”

✅ Strategy: Emphasize the health benefits of treatment, offer flexible payment options, and present elective care as a long-term investment in health—not just appearance.

3. Access Gaps & Policy Risks

About 27% of U.S. adults have no dental insurance, compared to fewer than 10% without medical insurance. Medicaid coverage is spotty, and some states are rolling back preventive policies like water fluoridation.

✅ Strategy: Position your practice as a community advocate. Consider mobile or school-based outreach and highlight preventive services in your marketing.

4. Ethics & Patient Trust

Cases of vulnerable patients being pushed into expensive, unaffordable treatment plans are surfacing more often. These stories erode public trust in dentistry.

✅ Strategy: Transparent treatment planning and honest financial conversations are not only ethical—they also strengthen patient loyalty and referrals.

5. Staffing Shortages & Rising Overhead

Three in five practices still struggle to hire hygienists and assistants. At the same time, supply costs, wages, and utilities keep rising.

✅ Strategy: Retain the staff you have with flexible scheduling, growth opportunities, and team bonuses. Use outsourcing or AI tools to free up team capacity.

6. AI & Tech: Promise and Pitfalls

AI is here to stay—whether it’s reading X-rays, tracking case acceptance, or managing scheduling. But adoption takes money, time, and buy-in.

✅ Strategy: Start small with one or two tools that solve a clear problem. Work with your CPA to evaluate ROI before scaling.

7. DSOs vs. Private Practice

DSOs are attracting younger dentists who want stability and support. For current practice owners, this creates competition—but also exit opportunities.

✅ Strategy: Lean into what makes private practice unique: continuity of care and deep patient relationships. If selling is in your future, now is the time to evaluate your practice’s value.

8. Marketing & Patient Engagement

Cancellations and no-shows are on the rise, and new patient acquisition is more competitive than ever.

✅ Strategy: Invest in SEO, Google reviews, and online scheduling. Automate reminders to reduce no-shows. Referral programs—digital and word of mouth—are still gold.

Conclusion: Thriving Through Change

2025 is not business as usual for dentists. Medicaid cuts, rising overhead, staffing challenges, and shifting patient behavior are testing every practice owner. But with the right strategies, these challenges can become opportunities.

At ML Advisory Group, we specialize in helping dentists build resilient practices—through smart tax planning, financial modeling, and business strategy. Whether you’re looking to grow, consolidate, or prepare for an eventual sale, the right financial partner can make all the difference.

👉 Next Step: Schedule a consultation with us at JerseyDentalCPA.com, NewYorkCityDentalCPA.com, or AmericasDentalCPA.com to see how your practice can stay ahead in 2025.