More about it here: Google Launched An Update This Week To Improve Domain Diversity | WebProNews
So what can we learn from this? Don't try to rank for many keywords that are too similar I suppose.
dentist in city
dentist city state
city state dentist
Now with this keyword I don't think there will be that much change as people just want to find a dentist, but for more general niches it could make quiet a difference.