Every day, dentists face the challenges and the adventures of running a dental practice. Having your own dental practice is the realization of a dream that has been years in the making. Before opening an office, however, most dentists find that there are questions that still need answering: "Where will my patients come from? How do I market my practice?" The answers to these questions vary from dentist to dentist. For dentists who may be saddled with debt from student loans or mortgages, these questions have direct bearing on their financial future. Patients build practices. Without a steady flow of new patients, it is impossible to build a successful practice. For this reason, the answers to these questions are not always so simple. This article explores some of those answers in the areas of issues to consider before deciding to participate in an insurance network, a dentist’s options in the realm of managed care, contractual considerations, the claims submission process, the hows and whys of electronic claims submission and the claim review process.
Each dentist must decide if participation with a dental insurance company is in his or her best interest.
 |
DENTAL INSURANCE: EXPLORING THE OPTIONS
|
|---|
Dentists face choices on how to market their practices in ways that attract new patients. One choice involves the dental insurance industry or third-party carriers. As a means of attracting new patients and advertising their practices, dentists may opt to become participating providers in the dental networks of one or more third-party carriers. The incentives to join are attractive. The carriers may promise more patients and prompt payment to participating providers. Such promises, made by the insurance company’s representative, are aimed at recruiting more dentists into the network. Before a dentist signs on the dotted line, however, there are many things for him or her to consider.
When evaluating participation in a dental network, begin by exploring your practice environment. Does the insurance company cover many people in your area? Ask the company’s provider relations representative to provide the names of major area businesses and the number of lives the carrier covers in your area. If the company hesitates or cannot provide that information, you may not want to consider joining its network. Next, ask how many dentists in your area participate in the company’s provider network. If your area is saturated with participating providers, realize that the number of "new patients" available for your practice is limited.
|
MANAGED CARE
|
|---|
The mere mention of the term "managed care" strikes an emotional chord in dentistry. All emotion aside, managed care is a permanent part of the dental environment. The term "managed care" originally was assigned only to capitation plans. Now it applies both to capitation plans and to preferred provider organization (PPO) plans.
Capitation plans.
Capitation plans, or dental health management organization (DHMO) plans, were designed to provide dentists with a steady income stream that allows them to provide care to their patients. The income stream or "capitation" is paid to dentists monthly. A specific dollar amount is paid for each patient covered by the plan and assigned to the office, regardless of whether the patient receives any services. During the past two decades, the amount of capitation per patient has decreased as a result of economic pressures. Capitation plans have morphed into hybrid plans that now include capitation payments, member copayments and supplemental payments by the insurance company.
When considering a DHMO, there are critical questions to ask. Aside from the capitation amount, it is important to know how many members will be assigned to your office and how many dentists in your area are accepting new patients under the DHMO plan. To avoid adverse selection and overutilization, you will want to negotiate with the insurance company to share the potential risk. A clear understanding of the compensation model is essential. Not all DHMO plans pay the same. Some plans pay a low monthly capitation and supplement the dentist by paying a set fee for frequently used services. Other plans spread the economic risk among all providers by paying a lower monthly capitation and pooling the remainder of the premium earmarked for dental health care costs. This pooled amount then is distributed among the dentists based on the amount of services provided by the full group of providers during the month. This type of compensation model results in a fluctuation in the monthly reimbursements to the dentists.
PPO plans.
If you are considering a PPO network, review the fee schedule very carefully. Do not look for the "crown fee" first. Many dentists make this mistake. Nearly two-thirds of most dentists’ production is in services other than prosthetics. Begin by evaluating the diagnostic and preventive services. Are the fees listed in these categories acceptable to you in your practice? Many PPO network fee schedules are designed to provide discounts of 20 to 30 percent off an "average" fee for your area. Each insurance company calculates this average fee by evaluating claims data from submitted charges for each procedure. However, some insurers set their area fees for in-network providers at the 80th percentile based on a request by the employer. This means that, by the company’s calculations, eight of 10 dentists in the area have a fee at or below the company’s listed fee for a procedure. Carefully evaluate each fee, using the resources at your disposal. (Author’s note: American Dental Association members have access to average fee data through the ADA to help with these evaluations.)
Questions to ask about limitations and exclusions.
After reviewing the fees and compensation model, ask the insurer about standard plan design limitations and exclusions. This is important in DHMO plans, because noncovered procedures may be charged to the patient at your usual fee for that procedure. Following are some questions you should raise.
- – "What are the frequency and limitations of coverage for examinations and radiographs? Is there a frequency limitation that takes into consideration all types of examinations—comprehensive, periodic, limited?" Some plans will reimburse a maximum of two examinations per year. This type of limitation may include examinations performed by a specialist to whom you referred the patient. The result could be that the patient would have no benefits for a second examination in your office that year.
- – "What is the frequency of coverage for adult and child prophylaxes?" The answer may differ from one insurance carrier to the next. Some plans will specify that a prophylaxis is a benefit once every six months. It is important to know that such limitations may mean six months to the day, plus one day. Some plans will allow two prophylaxes in a given 12-month period. This is different from two prophylaxes in a calendar year.
- – "What is considered a complete series of examinations? Does the plan cover vertical bitewing radiographs? What is the frequency of coverage for radiographs?" Many plans will have a three-to five-year replacement rule for a full-mouth series as well as vertical bitewings radiographs.
- – "Is there is a limitation on replacement of restorations?" Some dental insurers will not reimburse a network dentist to replace a restoration if the network dentist placed the restoration within a specified period, no matter what the cause for replacement. You also will want to ask about prosthetic replacement limitation. This limitation can be a five- to 10-year period from the initial placement date during which no reimbursement is available from the insurer for replacement of the prosthetic restoration. If the patient has had the same insurance for five years or more, the insurance company will know when a crown was placed, even if the patient does not remember the date.
Getting answers to such questions is important, because the participating provider contract binds the dentists to adhere to the rules of the insurance company.
|
SIGNING A CONTRACT
|
|---|
Participating provider contracts are binding documents. It is important that dentists review and understand every category in the contract. (Author’s note: As a service to members, the ADA offers assistances in understanding the terms of provider contracts through its Division of Legal Affairs.) There are a few areas in particular that require very close scrutiny in any contract.
Many patients mistakenly believe that having ‘dental insurance’ means that all services are covered.
Termination clause and procedures "in progress."
Start with the termination clause. Dentists should have as much right to terminate the contract as the insurer has. Some termination clauses require the completion of services begun before termination. Certain procedures are deemed "in progress" and are the responsibility of the dentist under the terms of the contract. Dentists should understand when a procedure is defined as "in progress." Some such procedures are obvious—for example, a tooth that has been prepared for a crown but for which the crown has not been delivered. Other procedures are not so clear, such as a treatment of a root canal that has just been started. Some plans define the start of a root canal treatment as the point at which the pulp chamber has been accessed. Others define it as the point at which the canals have undergone instrumentation.
What programs are covered.
When evaluating a participation contract, be sure that the contract is clear as to what dental plans, programs or products are covered. Some contracts require a provider to use all plans, programs or products the insurance company offers, even though all products may not be listed in the contract. This can lead to participation in programs that reimburse the dentist at a rate lower than expected.
Dental plans do not cover all services. Some contracts require participating dentists to provide noncovered services at discounted rates. Many contracts contain a quality management section. This section often requires dentists to abide by the company’s quality management or utilization management guidelines. Before signing a contract, ask to review these guidelines. One such guideline relates to the duplication and submission of records to the insurance company, including radiographs, at no charge to the patient or to the insurer.
|
THE CLAIM SUBMISSION PROCESS
|
|---|
Regardless of whether you choose to participate in a dental insurance company’s network, you will be faced with the challenges of submitting dental claim forms. Nonparticipating dentists must decide whether to submit dental claims for payment on behalf of their patients. If a dentist does not participate with any dental insurance companies, it can be argued that the patient, not the dentist, has a relationship with the insurer. In this situation, the dentist-patient relationship requires that the patient pay the dentist directly for services rendered. The patient then can submit a claim to the insurance company for reimbursement. Many dentists, as a service to their patients, enter into a relationship with the patient’s insurer by submitting a dental claim form seeking payment for services rendered. Dentists who provide this service must communicate one important fact to their patients: dental insurance is not insurance. It is financial assistance.
Benefits: what is covered?
Many patients mistakenly believe that having "dental insurance" means that all services are covered. Dispelling this misconception early is key to establishing a good dentist-patient relationship.
Before beginning a treatment plan, it is crucial for the dental office to obtain as much information as possible about the patient’s plan benefits. Many patients have booklets summarizing their dental benefits. The office should make a copy of the booklet for each patient’s records. Many insurance companies currently post standard processing policies for their dental benefits on their Web sites. Dental offices should become familiar with the standard benefits offered by insurers that provide coverage for a large number of their patients. Dental offices can subscribe to services that will provide online access to benefit summaries for the majority of dental carriers.
Predeterminations.
A more traditional means of determining a patient’s covered benefit is to submit a "predetermination," also referred to as a "preauthorization." These terms can be misleading. A predetermination or preauthorization is not a guarantee of payment for services. A predetermination is a request sent to the insurance company asking whether recommended services will be covered under the patient’s dental plan. The predetermination is submitted to the insurer on a standard claim form. The claim may describe an entire treatment plan or focus on a single procedure, such as a crown or implant. The insurer will review the predetermination on the basis of the patient’s plan benefits. Covered procedures will be identified with the "expected" reimbursement amount. Noncovered procedures also will be identified as having no reimbursement under the patient’s dental plan. The insurer then returns the predetermination to the dentist’s office.
Dentists should be cautious when providing services based on a predetermination. Some insurance companies review the predetermination without regard for the plan’s benefit maximum or frequency limitations. When a dentist submits an entire treatment plan listing all covered procedures with an expected reimbursement, if the plan maximum is exceeded, there will be no further reimbursement from the insurance company, even for covered services. A crown, for example, may be a covered service under the plan. But if it does not meet the plan’s frequency limitation or restorative criteria, there will be no reimbursement for it from the insurance company.
An office staff familiar with dental plan limitations and exclusions is invaluable in achieving the successful payment of dental insurance claims. Dental services provided by nonparticipating, out-of-network dentists usually will be reimbursed at a different percentage or fee level than those provided by participating or in-network dentists. Some dental benefit plans are designed to cover the same procedure at a lower percentage of the dentist’s fee if the dentist is an out-of-network provider. Many dental plan designs base their out-of-network reimbursements on an area’s average fee for each procedure. This average fee can range from the 50th percentile to the 90th percentile, depending on the insurance company and input from the employer.
For the dentists who choose to be participating providers, the submission of claims is a little easier and more straightforward. Participating providers have the advantage of knowing the fee for each procedure before providing the service. This is helpful to the office staff members who have to explain to patients the cost of their care. However, the fee schedule is not a guarantee of payment. The office staff members must check for any plan limitation or exclusion that would make a usually covered service a noncovered service.
When submitting claims to a dental insurance company, it is crucial to use the correct code to identify the procedure performed. The ADA has led the way in the development of a standard dental procedure code set, known as the Code of Dental Procedures and Nomenclature. In 2000, the Code was established as the standard code set for reporting dental procedures by the Office of Health Insurance Portability and Accountability Act (HIPAA) Standards of the federal Health Care Financing Administration (now the Centers for Medicare and Medicaid Services).1 This pertained to the third version of the Code and was an important ruling for dental claims submission.
The HIPAA ruling required that any dental claim submitted electronically could use only the codes and their descriptors as they appear in the current version of the Code. Although HIPAA applies only to electronic transactions, the ruling effectively made it administratively infeasible for insurance companies not to use the most current version of the Code for processing all dental claims. The Code is in its fifth version, which took effect Jan. 1, 2005. The Code is maintained and updated by a committee that includes representatives from the ADA, the dental benefits industry, the Delta Dental Plans Association and consumers. Updated versions of the Code are produced on a two-year cycle.
What happens when a claim is submitted?
Many dentists feel helpless once they submit a claim to an insurance company. They wait to see whether the claim will be paid and at what percentage rate. What actually takes place when a claim is submitted to an insurance company?
Contrary to belief and former practice, there no longer is an army of dental claims adjusters waiting to find a reason, any reason, to deny or return a claim. The first objective of the dental insurance company’s claims department is to get the claim information into the company’s computer system. The vast majority (more than 60 percent) of dental claims are submitted on paper. Some companies have data processors keying into their systems all the information from each claim. Other companies use scanning techniques to enter the claim forms and any attachments into their systems.
Once the information is in the system, the dental software takes over. Dental systems have been designed to link patient identification with a specific plan design. The system then can proceed through a series of checks against the plan’s benefits as well as the plan’s limitations and exclusions. This type of system enhancement allows for many claims to be processed without human intervention. This process is called "autoadjudication." Based on specific criteria that are part of the contractual agreement between the employer and the dental insurance company, the system can approve or deny certain claims.
An electronic claim can be tracked from submission to processing to payment—no more accusations of lost claims or missing attachments.
|
ELECTRONIC CLAIMS SUBMISSION
|
|---|
Electronic submission has helped improve the claims process for many dentists, though less than 40 percent of all dental claims are submitted electronically. The goal of most dental insurers is to increase the number of claims submitted electronically. Electronically submitted claims experience fewer processing delays as a result of requiring little or no human intervention. Less intervention can result in more prompt payment of dental claims.
All the leading practice management software programs include the ability to submit claims electronically. The software programs can connect directly to the insurance company or to a "clearinghouse" over a telephone line or through the Internet. A clearinghouse acts as a facilitator for claims submitted by the dental office. A dental office can submit all of its electronic claims for all insurance companies to the same clearinghouse. The clearinghouse then sorts all the claims by third-party carrier.
As a result of HIPAA, the clearinghouse also verifies that each claim uses the appropriate Current Dental Terminology code and then transmits the claim for payment to the correct third-party payer. Many dentists limit the number and types of claims they submit electronically because they have no electronic means of sending the required attachments, such as radiographs or periodontal charting for certain dental procedures. Some software programs now allow the transmission of digital images with the electronic claim. Additional vendors provide equipment for scanning dental attachments. The scanned attachments then are posted to a Web site, where the consultant from the third-party carrier can retrieve and view them along with the claim.
Clearinghouses as well as attachment vendors charge a fee for each transaction. Depending on the number of claims an office submits, the charge per transaction is less than the cost of mailing the claims. Some third-party carriers allow dentists to submit their electronic claims directly to them. This can reduce the cost further and improve efficiency. For those dentists who have a "wait-and-see" attitude about the claims they submit, electronic submission demystifies the claim process. An electronic claim can be tracked from submission to processing to payment—no more accusations of lost claims or missing attachments.
|
THE CLAIM REVIEW PROCESS
|
|---|
Although the use of autoadjudication is increasing for most dental insurance companies, many claims still are pulled from the system because they trigger a system edit that requires manual processing. A claim entering the claim processing system may be pulled or "flagged" for a number of reasons. A claim is flagged when it meets a requirement within the claim processing system’s "logic tree." A claim that has three or more crowns, for example, may be flagged for review by a dental consultant, who usually is a licensed dentist. In many states, only a licensed dentist can deny a dental claim because states generally define what the dental consultant does as engaging in the practice of dentistry.
Some states require the dental consultant denying a claim for a patient within the state to have an active license to practice dentistry in that state. This has caused some problems for dental insurers that have centralized claims processing centers. The dental consultant relies solely on the materials submitted by the treating dentist to make a determination. If clinical data are missing from the claim form or not evident in the attachments, the result may be delays in payment or even denial of the claim. Diagnostic documentation such as radiographs, photographs or periodontal charting often does not tell the whole story. To improve the likelihood of payment, dentists are strongly encouraged to include a brief narrative on each claim. For example, when submitting a radiograph, a dentist could add a note such as "Fractured lingual cusp no. 19" if the fracture is not evident on the radiograph. All standard dental claim forms provide an area for the dentist’s narrative or comment. The narrative provides for a dialogue between the dentist and the dental consultant. Dentist-to-dentist, it is understood that a fractured lingual cusp may not be apparent on a radiograph, but the diagnosis of the fracture would justify the need for a full-coverage crown. If a claim is denied, most third-party carriers offer the dentist the opportunity to speak with the dental consultant directly. Dentists should take advantage of this opportunity to speak dentist-to-dentist with the consultant to review the particulars of a case.
|
CONCLUSION
|
|---|
Dental insurance is a permanent part of the life of every dentist, but how much a part is up to the individual dentist. As a result of dental insurance, more people have access to dental care than ever before. About 150 million people have some form of dental insurance in the United States. Although dental insurance coverage has been a major contributor to the prosperity of many dentists, the relationship between dentists and insurers has had its challenges. As with all relationships, the key to success is communication and understanding. Individual dentists must gather as much information as possible to make informed decisions about whether participating with a dental insurance carrier is right for them and their practice.
TOP
ABSTRACT
DENTAL INSURANCE: EXPLORING THE...
