A Practical Guide for Startups and Acquiring Practice Owners
If you’re launching or acquiring a dental practice, setting your fee schedule might feel like a guessing game. Charge too much, and patients walk. Charge too little, and you’re working harder for less.
But here’s the secret: your fee schedule isn’t just a number—it’s the foundation for your profitability, growth, and even PPO leverage.
In this guide, you’ll learn exactly how to set dental fees strategically from day one. Whether you’re starting fresh or inheriting outdated pricing from the previous owner, this article will help you build a fee structure that supports long-term success.
Why Getting Fees Right From the Start Matters
Your dental fee schedule is more than a price list. It directly impacts:
- Cash flow
- PPO reimbursements
- Patient perception of value
- Staff bonuses and raises
- Practice valuation if you sell in the future
Too many new practice owners either copy someone else’s numbers or inherit fees that haven’t been updated in years. The result? Write-offs, low profits, and frustration.
Step 1: Know the Fee Types You’re Dealing With
Before we get into setting smart fees, let’s clarify the types of fees you’ll manage:
✅ UCR Fees (Usual, Customary & Reasonable):
Your “sticker price”—the full, undiscounted fee for each service. These are what you post, bill, and what insurance companies see.
✅ PPO Reimbursement Fees:
The reduced rates you’ve agreed to accept from insurance networks.
✅ Negotiated In-Network Rates:
When you work with PPO negotiators, these are your post-negotiation rates, which should be influenced by your UCR fees.
Bottom line: Set UCR fees first—these become the backbone for every other fee relationship in your practice.
Step 2: Benchmark Your Fees with Real Data
Don’t guess. Don’t copy the dentist down the street.
Do your homework.
Sources for Fee Data:
- Fair Health Consumer Fee Lookup
- Zip-code-based dental fee surveys (e.g., NDA, Henry Schein)
- Dental-specific consultants or fee analysis platforms
Start by identifying the median fee in your area for each CDT code. Pay close attention to your:
- Top 20 most frequently billed procedures
- High-ticket items (crowns, implants, extractions)
- Preventive services (where PPO write-offs are highest)
Pro tip: Don’t just shoot for the average—set your UCR fees at the 80th percentile for your region. That gives you room for profit and negotiation.
Step 3: Align Your Fees with Your Brand and Services
Your pricing should reflect your quality, not just your geography.
Ask yourself:
- Are you a boutique, high-tech practice or a volume-based, family-focused office?
- Do you offer sedation, CAD/CAM, or other premium services?
- Are you planning to compete on convenience, expertise, or experience?
Patients perceive value through pricing—just like they do with hotels, restaurants, or technology. Don’t undercut yourself.
Pro tip: If you’re investing in technology or a top-tier patient experience, your fees should match your value.
Step 4: Create a Tiered Fee Schedule Strategy
Not all procedures are created equal. Use strategic tiering:
🟩 Anchor Codes (High Impact):
Your most-used services (e.g., D1110, D2391, D2740). These should be optimized for PPO negotiation and profitability.
🟨 Bundled/Supportive Codes:
Procedures tied to hygiene or exams (e.g., D0120, D1208). Keep these competitive and patient-friendly.
🟥 Specialty/Selective Codes:
Services you refer out or only offer occasionally. These can be priced higher without affecting patient volume.
This structure ensures your bread-and-butter procedures are both profitable and negotiable.
Step 5: Plan for Annual Adjustments
You wouldn’t keep your lease, payroll, or supply costs flat for 10 years—so why would your fees stay frozen?
Even if you’re just launching, plan a yearly fee schedule review. Include:
- Inflation-based adjustments (typically 3–5%)
- Regional benchmarking updates
- Adjustments based on PPO negotiation outcomes
- Profitability analysis per procedure
Build it into your calendar. January 1 is a popular time, but any annual date will work as long as it’s consistent.
Step 6: Don’t Forget How Fees Affect PPO Negotiations
Here’s the often-missed link:
Your UCR fees influence how much PPOs will reimburse you.
If your UCRs are too low, you’ve killed your leverage before the negotiation even begins.
Set smart UCRs now, and you’re already preparing for future PPO optimization.
Step 7: Get a Fee Schedule Audit Before You Launch
If you’re acquiring a practice, don’t assume the previous fee schedule is in good shape. It may be:
- Outdated
- Misaligned with your business goals
- Priced below market average
- Disconnected from your service mix
Before opening your doors, get a full audit from a dental fee schedule consulting expert. This is a one-time investment that pays off in clarity, confidence, and long-term profitability.
Common Mistakes to Avoid
- ❌ Copy-pasting another practice’s fees without analysis
- ❌ Setting UCRs equal to PPO reimbursements
- ❌ Ignoring inflation or failing to adjust annually
- ❌ Pricing based on fear instead of strategy
- ❌ Starting PPO negotiations before setting UCRs
Avoid these, and you’re already ahead of 70% of startups.
Sample Scenario: A Smart Startup Plan
Let’s say you’re opening a new general dentistry office in Austin, TX.
- You benchmark the 80th percentile UCR fee for a D2740 (crown) at $1,450
- Your proposed PPO fee schedule offers $850
- You set your UCR at $1,485 and plan to negotiate a better rate within 6 months of network participation
- You review and adjust your hygiene procedure fees based on production cost and local pricing
This is what smart, strategic pricing looks like—and it positions your practice for growth instead of grind.
Final Thoughts: Build a Practice That Pays You Back
Setting your dental fees might not feel glamorous, but it’s foundational. A strong, well-researched, and flexible fee schedule:
- Supports profitability from day one
- Informs smarter PPO decisions
- Attracts the right patients
- Keeps you competitive (without racing to the bottom)
Want Help Setting Your First Fee Schedule?
PPO Negotiation Solutions offers expert UCR benchmarking, fee audits, and PPO optimization plans for new and growing practices.
Let’s make sure your pricing supports your production goals—not undermines them.
👉 Schedule Your Free Fee Schedule Review
Launch with confidence. Grow with clarity. Get paid what you’re worth.