Chapter 18: Working with Insurance Companies
Dealing with insurance companies is perhaps the most neglected topic in dental schools today. Dentists need to accept dental insurance if they want to have a profitable practice. Yet, there is no formal training for this aspect of their work. At the same time, insurance companies are not typically transparent with their policies. In addition, dental companies often find ways not to pay claims that are among their approved types of treatments. Thus, working with insurance companies can be a frustrating financial headache for dentists and their front office staff. However, a little self-education on dental insurance can go a long way towards helping you receive the most possible compensation from insurance companies.
Insurance Terms You Need to Know
- Allowed Amount – the maximum amount an insurance company will pay for a given procedure.
- Alternate Benefit – typically a cheaper treatment option which may actually be inappropriate for the patient’s need.
- Amalgam Downgrade – when insurance pays only the cost of an amalgam filling even if the patient gets a composite filling.
- Assignment – patients agree to the insurance company paying you directly so they can pay only the balance owed. Governmental agencies discourage assignment because they say non-assignment encourages patients to take better preventative care of their teeth.
- Benefit Amount – the percentage of a treatment that the insurance will pay based on the patient’s plan.
- Complete X-Ray Series (also called Full-Mouth X-Ray Series) – whenever panoramic x-rays are taken along with other x-rays, the price is reduced overall.
- Coordination of Benefits – in a case where the patient has dental insurance benefits from more than one source, the companies work together so they do not get reimbursed more than the UCR.
- Co-Pay – the amount the patient has to pay in addition to what the insurance company pays..
- Deductible – The dollar amount the patient must pay on their own before the insurance starts paying. Note: preventative care may not be included in the deductible.
- HMO – Health management organizations. A form of dental insurance that pays a regular amount per patient to the dentists. Payment rates are drastically reduced.
- Maximum Benefit – The most the dental insurance will pay each year before the patient must take over full cost responsibility.
- PPO – Preferred provider organization – a form of dental insurance that encourages patients to see in-network providers by giving them a higher rate of coverage than if they choose out-of-network providers.
- Missing Tooth Clause – A clause that prevents dental carriers from paying for treatment for teeth that were missing at the time of patient enrolment in their plan.
- UCR – Usual, Customary and Reasonable – the fee the insurance company is willing to pay for any procedure. Insurance companies each use their own formulas to calculate it and are free to apply the term as they choose. Insurance companies UCR to convince patients their fee is the one and only exact cost of the treatment.
- Waiting Period – The amount of time that must pass after the patient enrols in the insurance until they can receive approved treatments. Note: waiting periods typically apply to bridges, crowns, dentures and implants.
Levels of Service
Insurance companies assign each type of dental procedure to one of the levels of service. These are:
- Preventative Services – x-rays, cleanings, sealants; usually covered at 100%
- Basic Services – fillings, endodontics, periodontics, oral surgery; usually covered at 50% to 80%
- Major Services – crowns, bridges, inlays, onlays, dentures; usually covered at 40% to 60%
What to Find Out on Initial Contact with Insurance Companies
When a patient arrives at your office for the first time, you need to have them fill out a form where they fill in the following information:
- Full name of patient
- Name of insured if other than patient
- Personal identification number
- Group number and insurance company name
With this information, your front office staff can contact the insurance company to find out the answers to some preliminary questions such as:
- Deductible and amount of deductible the patient has already met.
- Maximum payment amount per year and how much the patient has met so far.
- Percentage breakdown for different levels of treatment.
- What cycle the yearly benefits are on – calendar year, contract year, or benefit year.
- How often routine services are allowed.
- What treatments are considered major and minor.
- How often replacement teeth can be replaced.
- Whether dental appliances like sleep guards are covered.
- If composite fillings are reimbursed at the same rate as amalgams.
Submitting an Insurance Claim
If the patient approves and you accept assignment of benefits, you will need to submit insurance claims for each treatment you do for them. The forms are standard and include:
- patient name and identifying information
- procedural codes
- description of service
- optional dentist explanation of reasons for procedure
The insurance company might also require that you send documentation such as x-rays to support the claim. Commonly this extra documentation is required for crowns, bridges and root canals.
If the patient pays for services in full at the time of treatment, you do not have to submit insurance claim forms. You simply give them a printout that includes all the information they need to submit the form themselves.
Cutting the Time It Takes to Receive Payment
The insurance companies often take up to a month to pay claims. If you want to speed up that process, you can have your staff submit the forms online. Allowing direct deposit into your practice’s account can also make processing go faster. However, be aware that if you choose direct deposit for all insurance transactions, you will have a large number of deposits which can rack up activity fees in your bank account. You also have to check deposits daily to know when the money has been deposited.
Another way to speed up insurance payment times is to gain a reputation as a dentist that demands to be paid. To do that, you need to train your staff and remind them as often as needed to be firm about receiving payments. They need to keep up with each claim and keep working it until it i resolved. Even if the insurance company unfairly postpones payment, your staff need to keep after the claim until it is paid. Once your clinic becomes known as one that will not settle for the insurance company’s delays and unfair maneuvers, they will often start paying more promptly.
You may decide to ask for pre-authorization for a treatment, especially if it has a high-dollar cost. Pre-authorization gives you and the patient reliable information about exactly how much of the treatment will be covered and how much the patient will have to pay. This can require you to put off scheduling treatment until the pre-authorization comes in, which can often be several weeks.
Dealing with HMO’s
You have the option of choosing to be a network provider for any HMO or not. Many savvy dentists choose the latter. Why? Although the HMO pays a monthly amount for each patient’s dental care, they pay at a deeply reduced rate and only authorize the least expensive treatment available. Not only do you have to see more patients to make ends meet, but also you often only can present insurance-covered options the patient is not interested in choosing. The other options will require complete out-of-pocket payment from the patient. In many cases, the patient will simply refuse treatment.
Dealing with PPO’s
The good thing about becoming a PPO provider is that you immediately become a network provider for many patients. Without spending time and money on marketing, you already have a group of patients who will seek out your services. The most important question to ask before you elect to become a PPO provider is for a list of the fee schedule that will be used to determine how much you are reimbursed for each procedure. Also, find out if they allow negotiation of fees. If so, you might have a chance of receiving payment that is nearer to your ideal reimbursement.