Dentists expect to be highly compensated because of their extensive time, financial and technological investment. Furthermore, dentists strive to provide the best patient experience possible with the latest procedural and technological advancements. However, little by little, PPOs encroach on that compensation and care level by reducing fee schedules over time.
What’s worse is that employees with insurance often tend to select a dentist from a list of providers participating in their insurance plan. So non-participating dentists often feel at a disadvantage in generating new patients, if they fail to participate in PPO networks.
Deficiencies of dental education
Dentists do not have extensive business or insurance knowledge. This makes sense, since, dentists study dentistry, and most dental programs place a greater focus on raw scientific and technical skill. Often, there is little training on the business side of dentistry and the insurance industry that essentially brings patients to the dentists.
What insurance companies do
Insurance companies often take advantage of the gaps in dentists’ business knowledge or more so, the level of time they can devote to it, since their focus is on providing excellent patient care. Hence, dentists may end up earning nearly half what they should from a standard procedure. Truthfully, there is not enough time for doctors to understand the intricacies of the system. However, there are some ways to improve the amount of money obtained from the insurance companies participated with.
Insurance companies also design their plans around the most common procedures. Because these PPOS dictate coverage by procedure, patient case acceptance may be negatively impacted if the procedure is less than fully covered.
PPOs have grown significantly in number and size, and therefore, overestimate the power they have, believing that dentists need their services. Hence, they include unfavorable clauses in contracts such as write-offs for particular procedures that decrease their fees by sometimes up to 30% or 40% less than the standard fee.
Fee schedule negotiation and PPO participation optimization is, therefore, essential to every dentist for adequate compensation going forward. Though the American Dental Association would like to help dentists with these issues, they cannot legally negotiate dentists’ fees. Instead, they provide advice.
How to make PPOs work for you
Here are some of the steps you can take to obtain proper fees due you:
- Understand your patient base
- Research and analyze your fee schedules relative to other providers
- Map out your patient/payor mix
- Restructure your PPO participation
- Negotiate higher fee schedules
- Engage a professional negotiator like PPO Negotiation Solutions
Understand your patient base
Understand your existing and prospective patient base in your area. Determine the most common PPO among those patients. That will give you a good idea of the PPOs you want to participate with and negotiate the highest fee schedules from. You will also want to actively seek out new patients with this insurance for an optimal claim reimbursement revenue stream.
Research and analyze your fee schedules relative to other Providers
Analyze the most common procedures you perform. This will help you build a solid understanding of which of these procedures are the most profitable and should be negotiated first with insurance providers. Next, research your fees relative to the average fee charged by all other providers in your area. If you can get this far, at the very least you can determine what you should be charging relative to other providers. Keep in mind most of your competitors are or have already undertaken either PPO negotiation and/or optimization and may already be reaping those benefits.
Map out your patient/ payor mix
The next step is assessing your fees. Determine exactly where the majority of your fees are generated. Chances are that less than 10% of it will be coming from individuals without insurance. Whereas, more than 90% of a dentist’s revenues come from PPOs. Because it affects a huge portion of revenue, dentists are often reluctant to make even an educated decision about how to participate in PPOs.
Side note: Rising costs are a never-ending dilemma
Operating costs inevitably increase every year. Equipment depreciates and must be replaced with new, more technologically advanced and expensive equipment. Although more and more American’s insurance covers their dental bills, most dentists earn the same amount, or actually, less with inflation, because of the fixed terms in the contracts between practitioners and insurance companies. Therefore, dentists have to find ways to increase revenue and PPOs are the best place to start.
Restructure your PPO Participation
Once you know exactly where your money is coming from, you can drop those plans which are not paying you what is due you and restructure your participation with the PPO’s that pay you more on average. In this manner, you will maximize your revenue and be able to better meet your rising costs.
Negotiate higher fee schedules
It can be incredibly daunting, but insurance companies will not make an effort to come to you and revise their fees. Insurance companies are businesses, and they care about bringing their costs down and increasing their profit. Hence, it is important, then, to negotiate for the absolute highest fee schedules with the insurance providers you decide to participate with.
When done correctly, a successful negotiation can increase your annual reimbursement revenue up to $100,000. If you have waited five years to do it, you have already lost up to a half a million dollars.
The most important step: Engage a professional negotiator like PPO Negotiation Solutions
The market is changing and dental insurance companies are steadily becoming more and more complex due to layering and rented networks. Furthermore, people no longer depend on a single dentist as they did in the past. This means that today, more than ever, quality care is important to keep patients and gain new ones. To keep your focus on that care, and due to the extensive learning curve and the time investment required; it makes more sense to hire an experienced professional negotiator like PPO Negotiation Solutions for optimal results.
With more than 30 years of experience in the field we have a proven track record and outperform other negotiators by:
- AUDITING your PPO payor mix & UCR fees relative to competitors
- DEVELOPING a negotiation plan outlining PPO participation
- NEGOTIATING the highest rate of reimbursement through cultivated PPO contacts
- FILING & TRACKING credentialing forms until you are safely “in network”
- COACHING your team remotely and/or onsite for maximum ongoing results
You can continue to do what you do best…treat patients with confidence and the highest quality care, and let PPO Negotiation Solutions do what we do best…produce at least a 24% increase in your reimbursement revenue, guaranteed! Our service is paid for within the first month after implementation and we provide easy payment terms.