Low PPO reimbursement is one of the biggest frustrations in the dental community (of course, excluding the insurance companies, who LOVE their low payouts). Dentists… I know you keep the thought of writing off 50%+ in the deep recesses of your mind until you see a PPO claim, have a minor breakdown and then get back to the hundreds of other things you have going on. If your practice is in network with most PPO carriers, the majority of the work you are doing is being discounted around 40%-60% from your asking price (UCR) for a procedure. Not one dentist wants to hear that, despite the full chair and busy schedule, quite a bit of the work being done is actually bringing in less money. These write offs cut into a large chunk of your potential production.
Great! We’re done with the bad news…
Did you know that the rates you agreed to in signing up with insurance companies are NEGOTIABLE? In fact, you are eligible to request increases to your “maximum allowable” fee schedules every two to three years. Here is another question for you. Have you ever negotiated your fee schedules/PPO contracts? If so, when was the last time and was it successful? PPO Negotiations & Optimizing your reimbursements is more relevant now than ever, but it requires a complex strategy for the best result. With dentistry booming and economic inflation taking place at the same time, everyone needs to be getting a fair price for the work being done in the chair. Negotiated PPOs and an optimized PPO structure results in collecting more money for the same amount of work you are currently doing.
In this article, we will go over the process of PPO Negotiations & Optimization of PPO contracts, the reasons that PPO Negotiations & Optimization efforts are more than worth your time and money, and a short guide to evaluate your level of need for PPO negotiations, strategic contracting, and optimization of your current PPO participation.
PPO Negotiations & Optimization
Negotiating your PPO contracts isn’t as simple as it may sound. Yes, you will have some success if someone in your practice reaches out to companies and asks for a fee increase. Some companies will say no, some will say OK and offer something standard and say it’s the best they can do (with hopes and crossed fingers that you will accept and lock in those slightly less garbage fees for 2-3 more years).
Without proper leverage and knowledge, the success will be minimal. The main leverage insurance companies care about when negotiating is leasing leverage. Did you know you can be in network with each company through other companies and their fee schedules? This is called PPO leasing. It allows insurance companies to process claims on your other fee schedules and of course, they will choose the lowest option that they see. Leasing can potentially be the worst OR best option for participation. Because all carriers overlap and intertwine, it is important to look at the big picture of all carriers in relation to each other. This takes an in depth process that is specific to your combination of PPO contracts. There are over 3,000 ways to configure your PPO participation. The odds of you currently having the best combination is very (very, very) low.
Here are the important steps to a successful negotiation process:
UCR Evaluation – Make sure your UCR fees are not falling below the market average. This can cause companies to cut into your fee schedules and only pay what you are asking. They often will not increase a fee schedule where they are already (in theory) paying close to your billed UCR fee.
PPO Evaluation – Confirm participation with all carriers, identify whether you are in network directly or leasing through a different company’s fee schedule, obtain all current fee schedules and analyze. After PPO Evaluation, all of the leverage needed to negotiate is identified and recommendations can start being made and then implemented.
Negotiations – The best negotiation strategy is not held only in a good relationship with the carriers. Although we know this is important, the most tactful leverage is in knowing all of your participation options. This is leasing leverage.
Optimization – There are plenty of ways to be in network. Through optimization, contract changes can make a low paying contract into a high one depending on your options. Optimization is when you add, re-structure or change the way you participate with an insurance on the fee schedule side, while remaining an in network dentist on the participation side.
PPO Negotiations can be done for solo-practitioners, group practices, DSOs and any specialty. They are extremely beneficial for new practices and acquisitions, as you can negotiate fees and contract on the best rates to begin with (meaning thousands of extra dollars in the first year of practicing, as opposed to signing up blindly with all companies to be in network quickly).
Is the expense for PPO Negotiations worth it?
PPO negotiation used to be a straightforward process. Many companies have started to offer PPO negotiation services and chalk it up to inquiring with negotiable carriers, asking for an increase with a cookie-cutter process, accepting what they offer and then providing results with percentages that sound impressive. However, these results are provided without any real data that shows the result of the work in real money terms. This makes it difficult for a dental professional to know if their PPO negotiation service was worth the cost and if those services are making an actual financial impact. A standard service also can quote you percentage improvements to the fee schedules but not outline a long-term strategy on what plans to accept, change, drop, add, etc..
With the right professionals in your corner, a PPO Negotiation project can result in massive improvements to the financial well-being of your practice(s). It is not uncommon to see a 10x return on your investment (if not greater). At Beacon PPO Solutions, we are the most custom and comprehensive PPO negotiators out there. We understand leverage and complex leasing strategies through proven and successful implementation. We utilize revenue and project tracking techniques that keep everyone informed and involved in the process from start to finish, and the cherry on top is the increased revenue that we can show you at the end of the process with estimated return on investment reports.
Is the expense for PPO Negotiations worth it? The answer is: maybe yes, and maybe no. I know, not helpful. To explain, each dental office is completely different. Returns on a service like this can depend on your current PPO participation, how much revenue you generate with each carrier, whether you are looking to downsize or increase PPO participation, the way leasing overlaps may be affecting your practice and other factors. Your practice may be a great candidate with plenty of negotiable revenue that can expect thousands to tens of thousands of additional dollars per year after negotiating and optimizing PPO participation. On the other end, your practice may only be in network with a few negotiable carriers and the expense may not be worth the return because the revenue just isn’t there with negotiable PPO carriers.
You can call us anytime or book a free PPO consultation through our website:
We can discuss the goals for your practice, your current PPO participation, explain our process, review revenue numbers to see if you are a good candidate for the services and then provide you with a custom proposal. We only accept clients that we know will have a successful outcome and offer guarantees for clients that we can show a return on investment for.
Is your practice a good candidate for PPO Negotiations & Optimization?
Here is a quick quiz for you to know if your practice needs Beacon’s PPO negotiation & optimization expertise.
You should consider talking to Beacon PPO Solutions IF…
You are opening a new practice and need to negotiate and know your options before credentialing
You are in network with the majority of PPO carriers
You are in network with any third party administrators or leasing umbrellas (Connection Dental, Dentemax, Careington, etc.)
You feel as though your fee schedules pay very low
You have a very busy office with a backed up schedule
You are out of network with insurances but want to grow exposure through adding some profitable PPO
You don’t know where to start with evaluating your participation or the profitability of your contracts
Your office is noticing companies using lower fee schedules for claims (default leasing)
You want to make more money for the work you are doing.
If any of these sound like you… I would recommend giving us a call or scheduling your free PPO consultation through our website. It’s free and we will also do a quick evaluation of your PPO participation/contracts and your negotiable revenue to determine if it’s a good fit. Worst case scenario — you endure some fun small talk and gather important knowledge of the PPO industry, your practice’s potential and some simple solutions to quickly improve your practice’s systems or participation.
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