DECEPTIVE MARKETING, MEDICAID FRAUD, AND UNNECESSARY ROOT CANALS ON BABIES: Private Equity Drills into the Dental Care Industry

The report examines the rise of Dental Services Organizations (DSOs) in the United States, noting that 27 of the top 30 DSOs are owned by private equity firms. It argues that the private equity model, which seeks high returns over short horizons, creates perverse incentives leading to overtreatment, Medicaid fraud, and deceptive marketing. Through case studies of Aspen Dental, Benevis, and North American Dental Group, the document illustrates how revenue targets can lead to medically unnecessary procedures, such as root canals on infants, and highlights a lack of regulatory oversight in the industry.

• Private equity firms have achieved near-total dominance of the DSO market, with 27 of the top 30 DSOs by number of affiliated locations being private-equity-owned, representing approximately 84% of those locations.
• A 2013 US Senate joint investigation found that corporate dentistry in the Medicaid program failed to meet quality standards, resulting in unnecessary treatments for children, improper anesthesia administration, and overcharging the Medicaid program.
• Aspen Dental Management Inc., majority-owned by Leonard Green & Partners and Ares Management, has paid at least $1.7 million in settlements with state attorneys general for deceptive marketing and exerting undue control over patient care.
• Benevis (formerly Kool Smiles) paid $23.9 million in 2018 to settle federal allegations of performing and billing for medically unnecessary tooth extractions and root canals on babies insured by Medicaid.
• North American Dental Group is facing a federal lawsuit alleging a Medicaid fraud scheme in Ohio, with reports indicating that pressure to meet revenue targets led to drilling into healthy teeth and unnecessary root canals.
• The report identifies a parallel between the DSO model and the private equity incursion into other physician practices, such as anesthesiology and dermatology, where management companies are used to bypass laws prohibiting investor ownership of clinical practices.

APA

O’Grady, E. (2021). DECEPTIVE MARKETING, MEDICAID FRAUD, AND UNNECESSARY ROOT CANALS ON BABIES: Private Equity Drills into the Dental Care Industry. Private Equity Stakeholder Project. https://pestakeholder.org/wp-content/uploads/2021/08/PESP_DSO_July2021.pdf

Chicago

O’Grady, Eileen. DECEPTIVE MARKETING, MEDICAID FRAUD, AND UNNECESSARY ROOT CANALS ON BABIES: Private Equity Drills into the Dental Care Industry. Private Equity Stakeholder Project, 2021. https://pestakeholder.org/wp-content/uploads/2021/08/PESP_DSO_July2021.pdf.

Wikipedia

{{cite report |last1=O’Grady |first1=Eileen |title=DECEPTIVE MARKETING, MEDICAID FRAUD, AND UNNECESSARY ROOT CANALS ON BABIES: Private Equity Drills into the Dental Care Industry |publisher=Private Equity Stakeholder Project |date=July 2021 |url=https://pestakeholder.org/wp-content/uploads/2021/08/PESP_DSO_July2021.pdf |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{ogrady2021deceptive, author = {O’Grady, Eileen}, title = {{DECEPTIVE MARKETING, MEDICAID FRAUD, AND UNNECESSARY ROOT CANALS ON BABIES: Private Equity Drills into the Dental Care Industry}}, institution = {Private Equity Stakeholder Project}, year = {2021}, month = jul, url = {https://pestakeholder.org/wp-content/uploads/2021/08/PESP_DSO_July2021.pdf}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }