Dentists often resist joining insurance companies because they are concerned by the number of write-offs.  They often are quick to determine that joining insurance networks devalues their services when they compare their UCR (cash) rates to insurance fee schedules.  This view is understandable.  Nonetheless, joining insurance networks is extremely valuable to stay competitive in this market.

It is also important to note that joining insurance companies (despite the benefits) will result in offering patients fees that are anywhere from 60-80% of the standard UCR.  The difference between the UCR and the insurance fee schedule is often the hidden price of joining the network.   However, the increase in patient flow achieved by joining insurance plans more than makes up for any perceived loss in procedural value between your UCR and the contracted insurance fee.   Remember, “A bird in hand is better than two in a bush”.

Either way, the good news is that dentists do not have to accept what the insurance company offers when they join a network. In fact, most dental insurance companies are willing to negotiate fees.  This makes joining insurance networks more palpable and profitable.

Even though it is worth it, fee negotiation is not a simple process.  It involves a fair amount of back and forth work between you and the insurance company.  It also can take a while (sometimes up to 120 days) before you get your increased fees.  The process can be work intensive, but the payoff can be significant as long as you do it correctly.  The worst thing would be for a provider to spend the time negotiating only to miss a few key opportunities where fees could be better negotiated.  This could result in losing thousands of potential dollars a year.  Nothing is worse than lost time and money to a busy professional.

Therefore, here are a few recommendations on how best to proceed:

  • If you already accept insurance, the first thing you should do is obtain copies of your insurance contracts and fee schedules.
    • You will need to contact the insurance companies directly in the even the contracts are unavailable. You should be able to pull your current fee schedule from your practice management software.
  • Review your contracts to determine eligibility for negotiation.
    • Some insurance companies do not negotiate. Do not waste time and resources seeking better fees from these companies.   You will almost always come up short unless you have a compelling situation that may justify consideration.
    • Insurance companies willing to negotiate (and there are several) may allow negotiations only every 24 months or so. Therefore, you want to make sure you are in the right negotiation window. If you have never accepted the plan before, the best time to negotiate is during the initial credentialing process.
    • Understand the difference between a direct contract and a contract with a third party administrator. There are often differences in fees between a direct contract and a contract through a third party administrator – even with the same insurance company.
  • Pull a report of your most common procedural codes
    • You will want to focus negotiation on what procedures you do most. It is likely that less than 30 codes make up the majority of your practice’s production.
  • Find out whether your state allows full UCR for non-covered services.
    • There is no need to negotiate a fee for a non-covered procedure in a state where you can charge full UCR. However, if you live in a state that requires you to charge the PPO fee, and you perform the procedure consistently, you will want to consider negotiation.
  • Examine your annual production by insurance company.
    • Pull the relevant reports and look to see where you have the greatest opportunity and the highest number of patients. Slight increases in fees may yield thousands of additional dollars of income per year. Target the highest yield company first.
  • Make the calls!
    • Call the provider relations departments of the insurance companies to discuss fee negotiation or schedule a discussion with a rep.
    • Take notes on this call because you may need to call back a few more times before speaking to an agent.

After speaking with an agent or rep, and initiating the negotiation process, you may have to wait several weeks or months for a response.  You may also find yourself going back and forth on a procedure.  It can be tedious, but an agreement to increase fees will be beneficial.

In the end, fee negotiation is crucial to maximizing PPO participation and profitability.  Please feel free to contact us if you wish to learn more, or would like Dentsential to help in your negotiation process.  We have the experience, tools, relationships and resources to get you the best possible fee schedule.  Not doing it right can cost you thousands of dollars and plenty of time.