Larry Elder interview Dr. Joel Strom on exactly how and whom the arbitrary raising of wage will hurt the poor and middle-class dental patient. You can read more on the minimum wage law at my site, here.
…This crunch is causing many of them to withdraw from Denti-Cal or sell their offices to the larger corporate dental conglomerates.
Those very same corporate entities are now cutting the depth and breadth of their involvement in the Denti-Cal program as well; one large chain of dental offices recently reduced their payrolls by 200 and cut the amount of new Denti-Cal patients they will accept.
At the same time, independent doctors and dentists simply can’t afford to stay enrolled in the program. Most of us need to employ a full-time employee just to manage the process of seeking reimbursement from the state government, which is a time-consuming process that can eat up more than 20 percent of an office’s costs. Yet many times, despite receiving pre-approvals, payment is delayed or sometimes denied by the state. Nor does it help that California reimbursement rates are some of the lowest in the nation.
These factors, when combined, have caused the majority of dentists to refuse to participate in Denti-Cal. Ten years ago, only a third of L.A. dentists participated in the program. Today, that number is believed to be far smaller. In fact, many dentists choose to deliver free care to a set number of patients rather than fill out paperwork, wait months to receive payments, or suffer the setback of not receiving anything at all.
And that’s where the minimum wage hike comes into play. About the only option available to these small business owners is to maintain consistent and lower payroll, including many times paying administrative staff between 20 and 30 percent less than a $15 new minimum wage. A substantial increase in wages will most certainly translate to increased business costs — costs which, thanks to state law, we can’t legally include in our pricing structure.
As a result, many low-income Angelenos now stand to lose access to the health care and dental care that they need. A $15 minimum wage may help some people, but it is undeniable that it will also harm many of them, as well. Where will the unintended consequences end?