9 min readEpisode 131: Dental Insurance PPOs – How to Get Ahead of the Curve

Carrie Webber, Owner, The Jameson Group

Below, we’ve compiled some of the key points discussed in the Jameson Files Episode 131. To enjoy the full conversation between our very own Carrie Webber and Laura Jamison, you can watch on YouTube or listen to the podcast on iTunes, Google Play, or Spotify.

Whether or not to be a part of PPOs is something dental practices frequently ask us.

Carrie Webber:

It’s a topic of conversation that we as dental consultants across the country are having with practices over and over again. When I am talking to doctors, they want to take a look at the PPOs they’re in network with and have help in deciding whether to go out of network or not. 

We frequently hear, “How do I do that? Is that something that I should be considering?” because they’re starting to feel ragged and burnt out. And so what I’d love to ask our audience today is if this is something that you are considering. Are you starting to feel some pain from the PPOs you’re in network with? And Laura, what are some first steps that you would recommend practices start to look at? What could help them make the right decisions for them in their practice on whether to stay or whether to go?

Biggest Reason Dental Practices Get Out of PPOs

Laura Jamison:

Honestly, Carrie, I really believe I’ve been training my entire consulting career to guide dentists away from being so dependent upon the PPOs. When I first started in dentistry, I was working with Dr. Jim Pride at the time, and he was warning that that train was leaving the station. Don’t sign up for these PPOs. They’re going to promise you these new patients, but at the same time, they were patients who only wanted what the insurance would cover. 

And so that’s exactly what the dentists are frustrated by. Patients only come in for their hygiene visit because they perceive they’re getting that for free. When any dentistry is recommended, they say, “My insurance won’t pay for that.” And you can only put up with that rejection so much. So the dental practice is left working harder than they ever have while making less than they ever have. 

Student Debt and PPO Networks

And we have these younger dentists who are coming out of school with a considerable amount of student debt. And they’re asking, “Should I work for a corporation or should I consider associating in a practice that it can ultimately buy?” And when the PPO reductions are actually understood, I think we’re going to find a whole generation of dentists who are going to choose a different route. Imagine having gone to eight years plus of school, with all the student debt, and not being able to really love what you do because of these limitations.

The primary interest in joining the PPO was to bring in new patients. Well, what type of patients are you bringing in? Only the patients that want what the insurance will cover. Worse yet, you have reductions. So the end result is that the insurance companies are reducing their fees by 35% to 45%. You’re working for 45% less than what you could charge. Your overhead is 60%. You’re actually losing money in this situation.

So we really have to first start with “what are you afraid of” when you ask if you should stay or go?

Carrie Webber:

You’re hitting the nail right on the head. We go in and network at these plans almost as if it is a marketing tool. But it’s really because we’re in debt or just getting started. Or the community is very much involved in these plans, so I have to do it to get or keep patients. But what we really need to be asking is: How do you want to take care of your patients? Are you able to take care of your patients in the way that you desire with this practice model?

Start with the Numbers

Number One: Active Patient Count

Laura Jamison:

So there are some numbers we need to look at when we’re evaluating this subjectively. Number one, what is your active patient count? Now, a lot of dental practices don’t really know. So, I will suggest to you that this can be done through Jameson with the help of Practice by Numbers. Then, once we know the active patient count, we need to compare it to what a general dentist, a single dentist and practice can manage effectively. 

Somewhere between 1,500 and 1,650 patients is about what an average dentist can manage without tearing their hair out. One dentist that we talked with today had 3,748 patients. That’s ample for an associate if they want to go that route. But they didn’t because they had student debt to pay off. Plus, they don’t want to pay 30% to somebody else when they’re only collecting 40% to 60% of the fee.

And gives us a great starting point from which to decide. With 3,700 patients, you could decrease to 2,000 patients and still be busy enough. So is it worth the risk that 1700 patients could leave the practice if you switch away from the PPO networks? And that’s where we can allay some of the fear. With this background, they feel they can take the risk—if the patient stays, great; and if they go, things will still be okay.

Number Two: Procedures Billed in a Year

The second number is the total number of procedures that have been billed out for a 12-month period of time. Similar to 1,500 to 1,650 being a number to know, 7,500 to 9,000 procedures per dentist,on average, can be effectively managed. And that includes the hygienists.

Number Three: Wait Time for New Patient Appointments

And the third thing to take a look at is how long new patients are waiting to get into your practice. Because what we’re seeing, even post COVID, is new patients having to wait six months, four months, three months. You’re telling yourself you need to stick with the PPOs in order to get those new patients. But you can’t even see them for months! What is the point?

So, if we’re able to answer all those questions comfortably, then I recommend that we take a look at which insurance plans we should keep. And take a look at which insurance plans are most risky. The punitive reduction can be as much as 46% to 50%.

Get Out from Under the Third Party

After that, we hire some help to look at the contracts and determine which ones can be renegotiated, which ones we want to kee, and which ones we want to disengage from. A lot of times the insurance contractor that you choose to renegotiate your insurance plans can help educate you on an issue that many dentists don’t fully understand, and that is being part of a network.

An umbrella like DenteMax or CareSource is a third party, taking a fee so you can be a MetLife or Cigna or Aetna provider. So the insurance contract where your negotiators are able to develop a relationship directly with Aetna or MetLife or Cigna, cutting out the third party organization that’s taking a cut is so much better.

Give Your Patients Great Alternatives

And then the third step is to realize that there are three alternatives for your patient, if you choose to be out of network with some of their coverage. 

Insurance Reimbursed Directly

Number one, many of our patients are reimbursed by the insurance company directly. I was out of network for three dental appointments. I paid with my HSA card, then my FSA card, and I was reimbursed almost a hundred percent of the fee. 

Now when my clients who have gotten out of network get the EOB back, and they see they’d been taking 40% cut, and the patient’s getting 95% of the fee, that takes away their fear of leaving the PPOs right there. But a lot of dentists don’t know this. They don’t know that the patient could be reimbursed directly.

So we, to make it super easy for the patient, will electronically file for them. We’re submitting it for them, making it easy. Typically the patient’s reimbursed within a week to two weeks. 

Membership Programs

Number two is membership programs. A lot of dental offices are seeing the benefit in providing a membership program where they set a fee in advance. The patient is literally paying for the two exams a year. And then they get a 15% to 20% reduction in fees with no limitations, no frequency limits, no maximum per year. In that membership program, they can have any dentistry they want with that 15% or 20% reduction. And for this, I recommend that you don’t manage it yourself. Hire someone who’s really good at this program.

Help Them Transfer to a Different Practice

Lastly, we can offer the patient the alternative of sending their records securely, safely, to the dentist of their choice, if they don’t feel the other options are right for them. If they decide to come back, we’ll welcome them with open arms. Many patients do. 

So you can give the patient three choices, and they have time to consider it and decide what’s best for them.

And this is why you want to hire a consulting organization to make sure your systems are in place, your communication with patients is stellar, and that the patient’s experience is something they’re willing to pay for.

Carrie Webber:

Such a great starting point and some great perspective, Laura. So, do I stay, do I go, and how do I make this decision for myself? There are numbers to look at. There are steps you can take. There are tools that you can bring into your practice or resources that you can lock onto to help you make the right decisions, execute those decisions, and get yourself on a healthier path forward for you and your practice. So I appreciate the conversation. I’m grateful to be here.

So if you want to explore what this looks like for you, we encourage you to visit us at our website. And if you haven’t looked into our online learning platform, Grow, I invite you to look there too, so you can get some clarity of your vision and start putting into play the systems and skills that can help elevate your practice to make these decisions and fully support the practice of your dreams.

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