Dental Insurance in the 21st Century

Put a group of dentists together and before long the discussion invariably turns to dental insurance. Today, if those dentists are in the states of Washington or New Hampshire it gets to that topic much more quickly and tends to focus on one particular company.

In these two states, and probably in many others, the business model that a majority of practices have been designed around is, or has been unilaterally changed. Participating practices were notified that the insurer was reducing the compensation available to the practice for all dental services.

This reduction did not provide an adjustment of the co-payment, creating a dilemma for every participating practice. The insurance carrier has assumed that the fees represent an overpayment to the doctor for his or her professional services and decided what an appropriate fee will be from this date forward; comply or be out.

I claim my bias that dentists (and pretty much every other professional) accept less than the value of their services when they participate with an insurance company – they didn’t build those buildings by paying the doctor. The insurance companies are not alone in lowering the value of professional services, ask any physician how they feel about their value as seen by their government “partner” in patient health, Medicare.

The truth is, every clinician has to decide if he or she is adequately compensated for their professional services, and the decision to participate or not with an insurance company is a business decision that must be weighed at inception and on a continuous basis for its viability in the business model of the practice.

The following are some thoughts on how you can move away from an insurance based patient population. This doesn’t mean they don’t have dental insurance, it means they are not making health decisions based on that insurance.

Clinical excellence is a requirement, every practice says it, some offices live it. Consider how you can create a different experience for the patient and through that a different expectation.

Know what you’re involved in. Look at a report each month showing all of the insurance companies you have a PPO contract with and note the adjustment total for that month. Know if you are permitted to have the patient choose a different level of service and compensate you for it. Know what services are not covered and whether or not you are contract bound to fees for those non-covered services.

Invite patients who express “significant dental issues they want to deal with” to a comprehensive evaluation rather than an initial exam. Patients who have significant dental issues are often able to think beyond the insurance ceiling and are willing to pay for more of your time because they seek answers.

Help patients understand that dental insurance is not “insurance.” By definition, insurance is protection from catastrophic loss. Dental insurance is a maintenance plan. If homeowners insurance were like dental insurance they would have to rebuild on their own if their home was destroyed and the insurance would pay to wash the new windows twice a year.

Use pictures and words to share observations and offer solutions to changes the patient wants to make. This can be MUCH more effective than offering a “treatment plan” to which the patient has no emotional attachment – if they ask for therapy they are much more likely to figure out how to pay for it.

When appropriate, discuss options so the patient can ask for information or make a choice. Too many choices will result in decision paralysis; too few choices will result in patients feeling trapped between “yes” or “no.”

Empower your financial coordinator to help patients make arrangements. Create guidelines for financing with options for outside financing that can be made in the office. Consider an option to self finance appropriate patients through a third party administrator to move the practice out of the loan business if outside financing is not possible for patients you would choose to treat.

(Click this link to read more dentistry articles by Gary DeWood.)