How can dentists compare PPO plans?June 21, 2016 | Category Coding and Insurance
For many dentists, more than 50% of their practice revenue is generated through Preferred Provider Organization (PPO) plans. Thus, it is important to compare PPO plans prior to enrollment as well as periodically after enrollment to ensure practice profitability.
As a starting point, compare the in-network reimbursements across your top grossing procedure codes. It can be helpful to use a spreadsheet to compare in-network reimbursements paid by each PPO plan. Use your office fees as a benchmark to calculate the in-network reimbursements as an average of your office fees. Rank each plan from highest to lowest according to the average in-network reimbursements. Factor into your ranking whether the insurance carrier is willing to negotiate in-network reimbursements and how often they are willing to negotiate.
Next compare each PPO plan based upon the number of your current patients covered by each plan. You may be able to obtain a list of your insured patients and their specific PPO plan through your practice management software. It may further be worth comparing the total number of insureds under each plan within your area from a patient growth perspective. A few PPO insurance carriers are able and willing provide to you the total number of their insured members located within a specific geographic region. You may otherwise be able to approximate the number insured members through researching the larger employer groups in your area, their total number of employees and then identifying who they utilize to provide or administer their employees’ dental benefits.
Finally, keep in mind the varying limitations placed on in-network dentists and insurance carrier requirements for claim payment when comparing PPO plans. These limitations and requirements are often overlooked but can impact PPO revenue. For example, one of the largest PPO plans limits reimbursement of periodic exams to exam one per year. Thus, in-network providers may be unable to collect payment for a second exam when completed within the same calendar year. Another major PPO insurance carrier now requires a narrative explaining necessity to obtain reimbursement for a PA film. This requirement makes it more a difficult or, at least, a more time consuming process to obtain reimbursement for this common expense. Insurance carriers will likely continue to implement cost containment measures and it is worth evaluating the associated in-network limitations and the obstacles to obtain reimbursement when comparing PPO plans.
For more information on comparing PPO plans, request a free insurance management consultation.