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Howard Speaks: Dentistry—and All Health Care—is a Cartel by Dr. Howard Farran, DDS, MBA

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Categories: Practice Management, HR and Accounting;
Howard Speaks: Dentistry—and All Health Care—is a Cartel 

by Howard Farran, DDS, MBA, publisher, Dentaltown magazine

Dentistry, like much of health care in the U.S., is part of a larger system. From 1980 to now, government spending has accounted for more than half of America’s GDP. While health care costs have ballooned to 17% of our GDP, we still haven’t addressed the underlying issue: the whole system operates like a cartel.

How does a cartel operate? Fixed prices, limited supply and divided markets to keep competition out and profits high. Think of a group of gas stations in a town secretly agreeing to charge the same high price, so no one can undercut the others.

Let’s talk numbers
The median annual wage for dentists in May 2023 was $170,910. According to the U.S. Bureau of Labor Statistics, the lowest 10% of dentists earned less than $82,760, while the highest 10% earned more than $239,200. The ADA says that average net income for dentists in private practice in 2023 was $218,710 for general dentists and $345,860 for specialists.

Compare that to those working outdoors—think cellphone tower repairmen, shrimp fishers, the guys on Deadliest Catch. They risk their lives daily and still struggle to afford health care, typically making a fraction of a dentist’s salary.

The average American is paying significantly more out of pocket on health care than citizens in most other first world nations. How is this possible? Free enterprise thrives when it drives innovation and competition. Those countries aren’t supporting a cartel of health care providers who inflate prices and limit competition.

A controlled system
Back when I started my career in Phoenix, I met a dentist who had fled Nazi Germany. She arrived in the U.S. as a fully trained dentist yet wasn’t allowed to practice without jumping through bureaucratic hoops and re-earning her degree. On the other side of this: the people who needed care—many of them poor—were priced out of affordable options.

Across the border in Mexico, the city of Los Algodones, aka “Molar City,” is booming. Thousands of Americans head there every year for dental procedures at a fraction of U.S. prices. Why? Because Mexican dentists aren’t bound by the same cartel-driven costs. And yet, here in the U.S., it’s illegal for a trained dentist from another country to practice without going through our state board processes.

This isn’t about health care quality, it’s about control. A controlled system doesn’t let in competition. It sets high prices and restricts access, punishing those who try to offer affordable alternatives. That’s why the health care system—and by extension, dentistry—needs to prioritize dismantling this cartel. There’s no reason someone should have to drive to Mexico to get a $1,400 dental implant that costs $4,000 in Phoenix.

U.S. health care is a broken system. When it crashes, it will be replaced by something more competitive and efficient. The sooner we face that reality, the better we can prepare for what’s next. We need to embrace the future rather than cling to the past.
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