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Since the advent of preferred provider organizations (PPOs) in the mid-1990s, dental networks focused on one thing—getting bigger. Today, Metlife advertises more than 146,000 providers in-network; Delta Dental 144,000; and Cigna boasts 153,500 providers in their PPO networks.
Most dentists participate in at least one network.
From 2007–2011, the number of providers participating in at least one network increased a whopping 72%—from 91,781 to 158,079. By 2015, the number increased by 34% to over 211,000. But since then, it grew a paltry 3%. Why the sudden and dramatic slow-down? The data suggests in-network providers are participating in more and more networks (28.3 per provider on average), but insurance companies have been less successful convincing out-of-network providers to join the fray.
The National Association of Dental Plans (NADP) reports 218,075 dentists are in-network, though ADA reported that as of 2020, there were 201,117 professionally active dentists. Despite the discrepancy in data, I think we can all agree a vast majority of dentists participate in at least one network.
In summary, there just aren’t that many providers left to recruit.
The networks are very similar. Which one is the best?
In addition to directly recruiting providers, dental network leasing resulted in providers participating in significantly more plans. Nearly every dental network utilizes leasing agreements as a tool to provide access to more providers. Guess which network has the most participating providers in Texas? Principal—and the company has leasing agreements with many other networks.
Herein lies the problem. Network leasing created too much parity. Many of these dental networks now look very similar comparatively. For example, fewer than 10% of United Healthcare (UHC)’s PPO providers in Texas are not in-network with Principal. This means that over 90% of UHC’s network is exactly the same as Principal’s. Moving forward, the competitive difference is cost. I.e., if dentists are going to participate so broadly, the best network will be the most cost effective.
As evidence of this new reality, many Texas providers received contract amendments in 2021 reducing reimbursements. Many of the proposed changes represented significant decreases for providers. The climate has changed so quickly that the ADA Council on Dental Benefit Programs recently announced it would communicate with payers on behalf of providers, articulating the financial impact of COVID-19. The communications include data illustrating how practice costs increased, though patient volume has not yet returned to pre-COVID levels.
Why not just go fee-for-service?
So what are we to do? The common answer found in forums and chats is to leave every network and go fee-for-service. However, this is not realistic for most practices.
Dental networks continue to grow because PPO participation status plays a meaningful role in patients’ decision making. 85% of patients visit an in-network dentist, according to a study published in 2020 by Guardian Life. There are simply not enough patients willing to go to out-of-network providers.
Additionally, employee benefits are the avenue by which most Americans receive their dental benefit. Employers grappling with skyrocketing health care premiums are looking for large networks to provide their employees with broad access to care and affordable premiums.
As a result, dental networks continue to work on bringing more dentists in-network, thereby reducing claims costs.
How to fight stagnant and declining reimbursements
Focus on your business. The best place of leverage in negotiating with payers is to not need to be in-network. Healthy businesses have freedom to make decisions from a position of strength. In addition to engaging a strategic partner to assist, the best way to combat stagnant and declining reimbursements is to build a vibrant business.
It’s increasingly important for you and your team to master the business of dentistry—especially with the COVID situation, tight labor markets, inflation, and consolidation. To thrive as a PPO provider, practices need to measure and evaluate key business metrics and understand how insurance participation affects these metrics.
And specifically, practices should allocate their resources to more actively manage PPO participation. Every business manager should build a file for each network consisting of the following:
- Copy of the insurance contract
- Copy of the current fee schedule
- Key contacts and notes, logged from correspondence
- Dates of events like re-credentialing and last successful fee negotiation (These should be logged.)
- Patients by insurance plan. (Track and report this monthly and look for trends.)
Further, each team member should maintain a working knowledge of insurance participation. For example, each member should develop the discipline to:
- Document when claims are paid under different fee schedules, such as through network leasing arrangements.
- Document benefit breakdowns at the network level. For example, document a patient as having either Delta Premier and Delta PPO, not just Delta Dental.
Focusing on your business and allocating internal resources to actively managing insurance participation will position your practice to be able to make sound decisions as networks become increasingly focused on managing costs.
Five Lakes Dental Practice Solutions can help your practice maximize reimbursements and manage your entire credentialing process. Five Lakes can also help you optimize your revenue and improve your patients’ experience.