Dental Insurance Companies: Friend or Foe?

Most of us have a love-hate relationship with the insurance industry. We purchase insurance coverage for a wide range of needs in the sincere hope we will never have to use it. If, and when, an accident or catastrophe occurs, we assume our coverage with the insurance company backing it up, will be there for us.
For many of us, this is when reality raises its ugly head. Whether, as the purchaser we failed to read the fine (read: tiny) print, or misunderstood the print we could read, we find ourselves working through a barrage of limitations, exclusions, exceptions, and pre-existing qualifiers that we had failed to note, or had not been brought to our attention by our broker.
The overall consensus, many of us feel, is insurance companies love us when we pay our premiums on time and hate us when we apply to use the very service for which we have paid. On a personal note, I have twice had to pay attorneys to force insurance companies to pay out on 2 (nondental) legitimate claims. One cannot help but wonder how much money the insurance industry makes from initially denying claims in the hopes that, as policyholders, we will just give up and go away.

INSURANCE AND DENTISTRY
I am the first to acknowledge that when I began my career as a dental practice administrator, my anti-insurance company thinking definitely clouded how I worked with patients and their dental insurance coverage issues. I assumed the insurance company was at fault, and I handled any necessary action based on that concept.

Table 1. Guidelines When Taking Assignments

1. Internal Controls


  • Strong business systems utilized
  • Daily insurance billing, maximize electronic billing
  • Designate a dollar amount above which eligibility is verified
  • Designate a dollar amount above which nonpaid claims receive prompt follow-up
  • Any unpaid claim after 60 days referred back to patient for full payment
  • Regarding dual coverage, take assignment on primary, not secondary
  • Prior to consultation, work out insurance/patient estimates

2. Practice/Patient Communication

  • Written/verbal communication educates patients to total responsibility for entire bill
  • Assignment accepted on acknowledgement guidelines followed
  • Patient moved to nonassignment when guidelines not followed
  • Key words/phrases to use to raise patients’ understanding of no quotes are guaranteed:
         Your [patient’s] estimated share is $X
         Your insurance company’s estimated share is $X

3. Oral and Written Financial Assignment Guidelines

[Patient], you are responsible for 100% of the $1,000 estimated treatment. Dr. Robinson, as a courtesy to her patients, does accept insurance assignment as long as you follow the assignment guidelines. Of the proposed treatment, we’ve estimated your approximate share to be $X and the insurance company’s estimated share to be $Z. This is just our in-office estimate. We can’t guarantee either eligibility or coverage, but we’ll use this estimate, as a rough guideline, until final payment has been received from your insurance company. At that time we’ll reconcile the account and bill or refund you any difference.


4. Assignment Notice With Statements

  • All patients are billed monthly regarding current status
  • Patients’ estimated share past due billed exact amount
  • Patients current with estimated payments told amount still due plus the paragraph in section 3 above
  • Patients totally paid up estimated share told that plus the paragraph in section 3 above

5. Software Support

Depending on your software program’s sophistication, you can: (a) key in appropriate message using an exploded code method, (b) have your software program calculate percentage, (c) have your staff handwrite a message on each statement, or (d) insert a preprinted page each envelope (stating the Section 3 paragraph) and handwrite $X estimated figure.

In my opinion, practices not billing insurance accounts every month regarding each patient’s estimated payment status set themselves up for collection problems later. Patients who receive a final statement after 2 to 3 months of silence, only to find the amount owed is more than the given estimate, are confused. And confused patients are not happy patients. It is best to establish clear and consistent monthly communication for assignment accounts.

That philosophy continued until the week that 2 new patients, Mr. Smith and Mr. Jones, walked into the dental office. Both informed me what wonderful dental insurance coverage they were lucky to have. Mr. Smith told me his coverage had a $150 deductable and a $300 yearly maximum! And Mr. Jones assured me his insurance coverage paid 120% of his treatment. One could actually see him calculating how he was going to spend his 20% refund check.
The first thing I did was get up to speed with the details of these 2 specific policies. I felt that logically, neither patient possibly had their facts correct. As Trojan Professional Services of California was not in existence at that time, practices taking assignment of benefits needed to take both responsibility and time to educate themselves and their patients about policy coverage, limitations, exclusions, and potential surprises.
My research showed me Mr. Smith was, in fact, 100% correct, and Mr. Jones, in fact, had been totally misled. Mr. Smith, so proud of now having dental coverage, was horrified to find that his yearly maximum would perhaps cover 2 of the 4 cusps of one of several crowns he needed. Mr. Jones’s 120% coverage turned out to be based on paying 120% of a fee schedule (table of allowance) 15-plus years out of date. Educating Mr. Jones to the fact that his insurance policy would pay an estimated 30%, and his estimated share was 70% of treatment, based on a policy paying 120%, became one of my defining moments in dentistry in understanding how dental insurance policies were written and purchased.
The guilty party in both cases, I found out, to my chagrin, was not the insurance company, as much as I wanted it to be. It was the employer who had purchased an inexpensive policy (costing pennies, not dollars, per employee per month) to simply save money without informing the employees as to the wide range of limitations and exclusions. As the purchaser, the employer was the party in charge, not the insurance company. If the insurance company would and/ or could not provide a plan to fit the employer’s pocketbook, the employer would move on to another plan writer. Through this experience, I realized that I had been directing my anger at the wrong players!

DENTAL INSURANCE AND OUR PRACTICE
It became very obvious that our dental practice was in fact the “fall guy” in the Mr. Smith-Jones equation. We were now on the firing line. Unbeknownst to me, it was in our job description to inform our patients as to the quality, standards, and limitations of their insurance coverage. I felt strongly that this was the responsibility of the purchaser (employer/union/group), not our dental practice. A job, I may add, for which we were neither trained nor paid.
Now, the doctor and I had to take a step back and make some major decisions regarding what role, if any, dental insurance would play in our practice. After analysis, our findings were scary.

  • Our patient base was 85% insurance, within which 60% was Delta (then CDS). We found 15% had dual coverage; several patients actually had 3 insurance policies.
  • We determined that not only was dental insurance not going to go away, it was quickly growing as an employee benefit. We could not ignore it, nor pretend it did not exist.
  • As a young practice, we did not have the confidence, at that time, to become a nonassignment practice. Confidence comes with experience.
  • In order to continue to travel down the road as an assignment practice, it became obvious that we needed to create an environment in which the team took a unified and effective approach to both handling the complexities of claim processing, as well as elevating our practice/patient communication to a whole new educational level.

It was time to implement simple and effective systems to put us in the driver’s seat. As consistency is the most important element of any successful system, I developed my “4 Rules about Having Rules.”
1. Have a rule for everything.
2. Identify the exceptions.
3. Know when to throw the rules out.
4. When you throw the rule out, tell the patient. Otherwise, they’ll think the exception is the rule.

WALKING MY TALK
As a practice management speaker and problem solver for many years, I have based all my management programs on the philosophies and systems that I developed for our practice years ago. They are as strong, relevant, and effective today as they were then. (Common sense and logic never go out of style.)

DENTAL INSURANCE AND YOUR PRACTICE
Every dentist has 2 major decisions to make about working with dental insurance: to take or refuse assignments, and to analyze the strengths and limitations of being a preferred provider. Regardless of the decision, a practice must maintain quality and consistency in communicating its policies and procedures to patients (Table 1). I invite the reader to use this article as a catalyst to analyze how your practice handles insurance management issues and practice/patient communication.

Take Assignment of Benefits—and Make It Work for Your Practice
There are no laws on the books that state a dental practice must take insurance assignment. When a doctor chooses to take assignments, it is a courtesy and a privilege being extended by the doctor to the patient. As such, there are protocols and guidelines that patient and practice need to follow. Key words and phrases must appear in every printed document and be clearly stated in every practice/patient oral communication. Patients need to be educated to appreciate this extra and generous service (Table 2).

Table 2.Taking Assignments on Accounts Receivable

Dental software reports list total dollars billed to insurance. I don’t believe any software system currently breaks down this figure down into a dollar and percentage of anticipated insurance payments and unpaid patients estimated share. In my opinion, this lack of defined detail creates a weakness in a practice’s monitoring system. In dentistry, an assignment office carries one to one and-a-half months’ production as accounts receivable. However, when doctor and business team can’t see this breakdown, I find “billed to insurance” a figure without merit.

Software companies’ solution is to require practices to post a patient’s insurance payment per procedure code. This method is extremely time-consuming for business staff who are already multitasking. As a result, JdSG Inc, estimates 80% of staff post-insurance payments as a bulk credit from the explanation of benefits.

Do not assume that one has to take the assignment from every carrier/plan. Practices taking assignments do so based on the assumption insurance companies will honor them: When an assignment check is paid to a patient instead of the practice, a decision needs to be made as to whether the practice wishes to continue the gamble of continuing to take assignment from that specific insurance company/plan. The chances to have an insurance company stop the check, reissue it to doctor, and then contact the patient for reimbursement are slim to none. For the record, Connecticut General, on one occasion, did just that for our practice. Within 24 hours of admitting their error, they reissued us a $1,000 check and sought redress from the patient. The moral of this story illustrates the value of taking a professional and positive approach when working with insurance company staff. It can pay huge dividends, literally!
A preferred provider: Doctor and staff must be 110% conversant with all parameters, limitations, and exclusions of any program; this should be conveyed to patients in a positive and open manner. If the reason for participation is to increase business (and analysis shows business is either down or not increasing), a practice needs to take an honest look at how the telephone is being answered and how patients are handled within the practice. A practice does not need to be a contracted preferred provider to accept assignments. It is essential staff handling telephones clearly understands this point. If the actions taken which originally caused the practice to initially slow down are not addressed, being a preferred provider available to a focused group of potential patients does not guarantee an automatic increase in new patient flow and treatment acceptance.
Is the hassle and risk of accepting Assignments a good return on investment? In big picture terms, I say yes. On the understanding the practice utilizes strong management systems, effective monitoring tools and a high level of practice/patient communication skills.

Prefer to be a Nonassignment Practice? Sounds Good to Me
Practices successful in nonassignment status are guaranteed to have a doctor passionate about dentistry with the ability to motivate patients to be excited about the value of accepting both needed and elective treatment. These dentists put great emphasis on patient education, while raising team involvement to the highest level. Nonassignment then becomes a nonissue for a majority of these patients.
Funding for patients is a big part of this equation. Nonassignment practices need to be especially proactive in making patient financing available to support the patients’ decision to move ahead with treatment. As one of the first practices to implement the nation’s first patient financing program years ago, I have always totally embraced outside patient financing as the lynchpin of patient payment options. Programs such as CareCredit take doctors out of the banking business, where they do not belong. I do not want to hear about the cost of financing—it is simply the cost of doing business. To answer the question before it is asked, “What about patients who are denied financing?” Doctor, you have just received a free credit check; forewarned is forearmed.
A word of caution for the nonassignment practice experiencing a low treatment acceptance level. Doctor, if your nonparticipation in assignment is fueled by negative feelings about insurance companies dictating your treatment—the never-ending paperwork, lost claims, delayed insurance payment and eligibility concerns—I invite you to revisit your thinking. If/when your frustration is apparent to staff, I find it gives them “permission” to incorporate that same attitude into their thinking and behavior as they work with your patients. Patients who sense that a dentist and/or staff have negative feelings about handling claim processing (and the built-in follow up issues) may begin to reflect on whether they are, in fact, in the right office. Poor patient insurance support services do have a far-reaching impact on treatment acceptance and practice growth.
I am confused about 2 phrases currently in vogue—Doctors who use the phrase, “I am a “noninsurance” or “I am an insurance-free practice.” As a patient, what does that mean to me? I perceive it to mean that I am not able to utilize my dental benefits with this dentist. I am being asked to pay my entire treatment cost directly to the practice, while losing the ability to apply for reimbursement from my insurance company and/or employer. As a patient, it feels a little pompous to me, with the fees above the “going rate,” the practice is not patient-centered.
When I wear my “management hat,” I think what the doctor means is that this practice works directly with the patient, and that the practice is most happy to file insurance claims for patient reimbursement.
I would like to submit the following sentence for consideration, as being much more customer friendly and reflective of the true picture. “We are a nonassignment practice, working directly with our patients on financing options and providing insurance reimbursement services.” In today’s economic climate, with consumers watching their elective spending decisions, it seems nonproductive to me to put up barriers to treatment acceptance any more than the current financial climate is doing.

CLOSING COMMENTS
Patients are so appreciative when their dentist and team help them maximize their insurance benefits. From treating in phases, to taking that extra minute to add a line about a procedure that may result in additional coverage, patients perceive this helpfulness as being one of outstanding customer service. Realizing the true position of insurance companies and the true role employers played, I found myself doing 180º mind change. I actually began to enjoy the challenge of taking on denied procedures or reduced benefits. (At that time we did not have people like Tom Limoli, Jr [Atlanta Dental Consultants], to help us.) As I grew in knowledge and confidence, we found patients directly referring their friends, neighbors, relatives and co-workers to the practice. The word around town was that we went the “extra mile” for our patients. I have lost count over the years of the thousands of dollars I successfully claimed back for our patients after the initial denials.
The most dramatic case I remember was Mrs. Carlson. After several calls, I got the insurance plan to pay an additional $2,000. When I handed the check to her, she smiled and handed it back to me, saying, “Put in on our account. It’ll be good to know we don’t have to worry about our dental bill for a while.” She would not even let me pay her interest. Customer service does not get much better than that.
As I have said for years, “A dentist is judged by everything but their quality of care.” In these tough economic times, a practice perceived by patients as being unhelpful with dental insurance processing (and/or a poor attitude), in my opinion, is inviting its patients to move on to a more helpful environment in another dental practice.
The financial marketplace tells us that retail sales are down. Consumers have reduced their spending, but they are spending. What today’s consumer wants, and is demanding, is to receive quality for the asking price. It is essential that doctor and team educate patients to the benefits of financially investing in their dental health, as well as the limitations of treatment being delayed.


Ms. de St. Georges has been a dental practice management educator since the late 1970s. A member of the National Speakers Association (NSA) for the past 25 years, she’s served on the board of the Northern California Chapter (NC) and also donates her time to presenting programs on the Business of Speaking Professionally to the Fast Track One Year School for NSA/NC. She is owners of JdSG International, a dental practice management company. She serves as a dental advisory board member for Dentistry Today, and was the first nondentist to be named to this position. She can be reached at (800) 366-7004, via e-mail at clientservices@jdsg.com, or via the Web site jdsg.com.

 

Disclosure: Ms. de St. Georges is occasionally sponsored by Care Credit for speaking engagements.