Each dollar of increased collections goes directly to the “bottom line” in the practice – the overhead has already been paid! However, many dentists are reluctant to raise fees in this competitive environment. There is some justification for this thinking but each dental practice should do some research and spend some time thinking about this issue. Also consider that some fees are very “visible,” such as prophies, and these fees should be raised judiciously. However, the majorities of dental fees are quite “invisible” to patients and can often be raised to increase collections without adversely influencing patients’ perceptions of the practice.
So far, we have been talking about “UCR fees” which apply to cash and non-PPO insurance patients. But for many dentists, especially those with new practices, these patients are in the minority and most fees are controlled by the contracted amounts paid by PPO plans.
But there are two things you can do to increase collections from PPO plans that many offices overlook.
- First, update your fee schedules! Insurance companies often increase their fee schedules but may not inform you. Or, the new information may simply be overlooked by a busy dentist or dental staff, and many are not aware of the impact of this simple task on increased collections. At least once each year (and the New Year is a good time!), you should have your staff ask that each PPO with which you contract to send you the most recent fee schedule. Then be sure those fee schedules get entered into your computer software.
This is one of the first things we look at when we start working with a practice contracting with PPO’s. We often find schedules that are way out of date. Simply using the new fee schedules can make a sudden, dramatic increase in collections and profitability.
- Second, be sure you always, always, always put your UCR, not your contracted fee, on the dental insurance claim. This is not only legal but it is what most insurance companies want you to do.
With good dental software, this does not affect the amounts that appear on the patient’s ledger or in treatment plan estimates. The only place it appears is on the electronic or paper claim.
By always submitting your UCR fees to insurance carriers, you inform them of the “market rate” for dental procedures and they (sometimes!) use this information when calculating their periodic fee increases.
Proper setup of insurance information is critically important to the profitable operation of a dental practice. This screen from the insurance setup in Open Dental Software has the “bill UCR” box correctly selected.
But the real advantage to the dental office is that it alerts you to the fact that a specific fee has been increased by the carrier. For example, your UCR fee for a specific procedure might be $100 but your contracted fee is $70. The patient ledger shows $70 but the insurance claim shows $100. For the last year, this particular carrier has been paying you $70 every time you complete this procedure. But suddenly you notice that they are paying $74! Whoopee, they increased their fee for this procedure! If you had been billing your contracted fee, $70, on the claim, the carrier would have continued to pay you only $70. But because you billed your UCR of $100 you collect more and you are “alerted” to this contracted fee increase. Now you can make the corresponding change in your software.
Congratulations! By doing the things discussed above, you just increased collections for the New Year! You “got a raise” that went directly to your bottom line!
About the Author
Bruce Stephenson has been a practicing dentist in San Leandro, CA for 38 years. He now limits his dental practice to Invisalign, and is a partner in Today’s Dental Consulting doing practice enhancement training and coaching. He can be reached at [email protected], or by phone at 209-603-9944.