Medical costs for a medical procedure can vary from one medical provider to another, by hundreds and, sometimes, even thousands of dollars. Costs can also vary by whether a provider is in-network or out-of- network with an insurance plan. What is the role of insurance claim repricing when it comes to paying for medical services? How can you ensure that your practice is making the most revenue and making the best of claims repricing? In this article we will discuss how claims repricing works and how you can prevent loss of revenue in your dental practice due to claims repricing.
What is Claims Repricing?
When a medical or dental practice treats a patient, a claim report is filed with a patient’s insurance company. This claim contains a detailed description of the care received by the patient, such as medication the patient received, procedures performed on the patient, material used for treatment and provider’s fees.
Once a claim is received, insurance companies adjudicate if the patient is eligible for the service that was received based on the terms of their insurance plan. Then, the charges are repriced based on the terms of the contract between the insurance carrier and the medical provider. The information is sent back to the medical provider, along with the amount owed. The patient can then be billed the remaining, new out of pocket charge that the insurance company has dictated.
For example, a claim from a medical provider may be very detailed and include several individually priced items on a list. However, an insurance company may only allow a set amount for a medical service per a contract, so the claim amount and the billed amount can vary in price. Allowed amounts can vary depending on geographical location, whether a provider is in or out of network with the patient’s insurance and the average charges of other practices in the general area.
Claims repricing is, in effect, a determination by the insurance company of how much of your dental practice’s set fee will be paid and now much will be passed on to the patient, after the services performed have been approved and paid according to the insurance company contract. Of course, you want to avoid passing on too much expense to your dental patients, or risk having them move to another practice with better pricing practices.
What are the Benefits of Claims Repricing?
Claims repricing can be beneficial to both a business and the customer receiving a medical service. Billing errors are common in medical and dental practices due to large amounts of paperwork. Medical claims repricing can help eliminate errors that increase costs and lead to underpayments or overpayments on insurance claims.
Insurance companies have a set amount that can be paid to providers for select services. This is meant to avoid instances where customers are overcharged. By having a claims repricing process, insurance companies can also monitor for fraud by overstatement of claims, by frequently checking and validating claims that are submitted. This prevents consumers from paying larger out-of-pocket expenses that are not necessary.
How Can Claims Repricing Affect my Practice?
Claims repricing can affect the revenue of your business either negatively or positively. For example, a patient with Pretty Smiles dental insurance comes into your practice for a root canal. You expect to get paid $750 for this service from insurance, since this is the total cost for materials and labor. You send the claim to the patient’s insurance, but Pretty Smiles only allows $600 for a root canal procedure. Simply explained, your dental practice is spending more than it is earning in this scenario.
Another scenario could see a patient coming to your dental practice for a routine cleaning and exam with Happy Smiles insurance. Your dental practice is not in-network with Happy Smiles, but you are connected with other networks that participate with Happy Smiles. After submitting a claim for $300 to cover the exam, x-rays and dental cleaning procedure, claims repricing by the insurance company’s adjudication system reduces the amount paid to you by Happy Smiles to $198. Since you are not in-network with Happy Smiles, you are reimbursed at the lowest possible cost for these provided services.
In this case, your dental practice should investigate whether it should become in-network with Happy Smiles to obtain a better rate, or simply refuse to accept Happy Smiles insurance because of such a low reimbursement rate. If you only see a patient here or there that has Happy Smiles insurance, your practice may be better off refusing the insurance.
How Can I Make the Best of Claims Repricing?
There are a few ways that you can avoid losses due to claims repricing. When filing a claim, charge standard rates, but ensure that what you are charging is updated and in line with what is being charged at similar dental practices in your area. Assess which insurance providers you are in-network with and whether it is beneficial to your business.
For example, 20% of your client base may have a Pretty Smiles insurance plan, so it would be important to be in-network. Adjusting your pricing to work with this company will earn you more through patient volume over time. Another way to prevent losses is to protest any involuntary changes made during claims pricing that could affect your current clients. This is best done in writing to maintain a paper trail.
You should also consider utilizing a professional company that specializes in PPO negotiations. PPO Negotiation Solutions is a company that can help navigate claims repricing, increasing your reimbursements by nearly 24% and minimizing losses to your existing clientele.
The most important focus in your dental practice is your patients. Do not let insurance struggles and stress over reimbursement get in the way of quality patient care. Contact PPO Negotiation Solutions today to increase your practice revenue, so you can continue providing excellent patient care.