Hole in upper right molar -- Does my tooth need to be removed? (photo)

Based on what I see in the photo, but without having additional information and seeing an x-ray and examining your tooth, I suspect you have going on is not decay, but rather "resorption."  If there is little solid tooth remaining inside, then I would agree with your dentist about removing it, as it is probably too late for a root canal and crown.Regarding implants, it appears from the photo that the tooth is an upper second molar (#2 or #15), and typically this is not an area that will support well and implant.  However, that does not mean that one cannot be done.  It might need a procedure called bone augmentation and sinus lift surgery, but often times not worth doing because of the time, money and effort to have it done.

at first glance I would think it could be saved. An X-ray would help.  Hate to say it, but options are limited on some insurance plans or Medicaid.  Ie, Medicaid has will not pay (as in never) for a root canal on an adult, so the only option presented is removal.  Your choices may be a factor of your insurance.  Without a physical exam, it is hard to say what your options are.