PPO vs Non-PPO Contracts
Feel like you’re pulling your hair out trying to figure out insurance? Even with the ease of electronic insurance filing there is still a large administrative cost associated with being an in-network provider. Delayed insurance payments, yearly maximums that have stayed stagnant for years combined with rising costs make dropping insurance plans seem an increasingly more attractive option. Wouldn’t it be great to get out of the insurance game all together? Maybe you can, but rarely do we recommend dumping all plans at once. Instead, we recommend you consider many factors that contribute to what makes you enjoy dentistry.
Dentistry by nature is a stressful profession and shaping your insurance involvement to reflect the type of dentistry you want to provide is one step in helping ensure a longer career. Many dentists have become burned out by getting busy with PPOs only to build a practice of running crazy with maximum patients yet declining profits. The sigh of relief from building a full patient base is quickly overshadowed by a packed schedule that isn’t producing the fruits that were seemingly promised. How do you determine what mix of insurance to accept, if any?
On the positive side, PPOs can be useful in generating new patient flow. By being listed as a Provider, the insurance company markets your practice to their list of insurance patients on your behalf. Start-up practices, in particular, need a quick influx of new patients and often PPO involvement is one way to accomplish that. Unlike traditional marketing expenses which can be expensive with little results, PPOs do not “cost” anything until the dentist has actually provided care for the patient. Many dentists do not have the time or inclination to become educated in the specifics of marketing campaigns making PPOs the default means of gaining patients. Some practices do marketing in addition to participating with PPOs, some are able to use PPO participation as their only form of marketing. As the economy lags in most parts of the country PPOs are also being considered as a way to jump start production and new patient flow in areas that are continuing to battle decreasing production.
Drawbacks to PPOs are obviously the write-offs. You will collect less than your regular fees as an in-network Provider. How much less depends on the contract. Some insurance companies negotiate fees others do not, often depending on how many other Providers are in your area and how badly they need participating dentists to be able to sell their insurance plans to employers. As a practice becomes more established, typically the dentist continues to broaden the range of services provided. Newer services or cosmetic services such as implants and veneers are often excluded from coverage. If the dentist is heavily cosmetic based it becomes harder to work within the framework of PPOs because many do not allow you to pass the cost on to the patient even if they are non-covered services (depending on the state you practice in and the policy). These restrictions often limit the services that can be offered to PPO patients if reimbursement rates are not even enough to cover the cost of the procedure.
Be aware that the days of easily understood contracting are over. It’s now often possible to have 3-4 different potential ways to contract for the same patients. Direct contracts vs. shared networks and third party administrators now mean it’s critical your office carefully understands the contracts you’ve signed or are considering. Many of our clients initially called because they want to be selective in their PPO participation but want to be sure they are making good choices and clearly understand what they are agreeing to and the impact any agreements will have on their practice before signing.
We encourage dentists not to look at insurance as a black and white issue. As a practice grows and changes over the years so will views on insurance participation. What may be a good fit at one point in a dentist’s career may gradually change as a practice builds the patient base, reduces practice debt or expands services. Our company helps you get control over which plans you take according to your personal and practice goals. For a free phone consultation visit our Contact Us page.