The Harvellsâ€™ 2-year-old business, Dental Kidz (www.dentalkidz.com), follows a business model in which 80% of its patients pay for their services with a state-subsidized healthcare plan or Medicaid, the federally and state-funded health insurance program for low-income families and other people in need. â€śPutting a state-of-the-art practice in a lower socio-economic area was important for us because my husband grew up poor and he grew up receiving services in facilities that were outdated or not child-friendly,â€ť says Levene Harvell, 33, a pediatric dentist with a doctorate of dental medicine from the University of Medicine and Dentistry of New Jersey.
Getting credentialed to accept Medicaid was not hard; any doctor that meets the criteria and wants to take a government-subsidized plan can do so. However, Harvell, 36, says accepting the majority of payments from Medicaid is rare and not something that you will see most dentists doing, because Medicaid insurance reimburses dentists for their services at a significantly lower rate than private insurance does. Eric Elmore of the New Jersey Dental Association says that the state of New Jersey reimburses dentists for Medicaid at the lowest rate in the country. To counter this, Dental Kidz makes up the revenue difference in sheer volume.
The practice has 12 employees and about 6,500 active patients, and sees roughly 50 children a day. During its inaugural year, 2009, Dental Kidz generated $476,000 in revenues and broke even in its first 14 months of operation. Revenues for 2010 reached $1 million and 2011 revenues are estimated at $1.6 million. This comes after a total project investment of about $2 million, which the Harvells funded with a $650,000 loan from the Brick City Development Corp. and the Grow America Fund, two equipment loans totaling $350,000, a $250,000 personal investment, and reinvestment of funds.
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