Should You Outsource Your Dental Insurance Billing?
Outsourcing aspects of your business to an outside provider has been a common tactic of many businesses for years. It’s becoming much more prevalent in dentistry post-covid, due to challenges many offices are experiencing challenges finding and retaining enough team members to stay functional. Hiring someone outside (individual or vendor) to process a piece of your business that used to be done by a team member is known as outsourcing. The most common function or process that is typically considered for outsourcing in dentistry has been with patient communications systems, also known as automated patient appointment reminders.
One of the more common questions which we have been receiving through our Dental Insurance Guy forums of late revolves around the topic of outsourcing for dental insurance, “should we or shouldn’t we?”
Let’s review the major steps involved in processing dental insurance claims and explore the pros and cons of handling each either within your dental office, or through an outside provider.
Verifying insurance before starting treatment can be one of the more critical aspects of dealing with dental insurance. We need to know if the patient has coverage and if it is currently active to ensure that there will be no surprises during claim processing for either the patient or the dental office. Since the status of a patient’s coverage can change at a moment’s notice, verification really needs to be done every patient visit assuming your office is planning to bill insurance for reimbursement. Thankfully, this process is quick and easy most of the time. Online portals and faxbacks can get you these details with a few seconds of effort. Due to the simplicity and high frequency necessity, this task is almost always done internally (not outsourced).
Often mistermed as verification, the breakdown is the most complex portion of dealing with dental insurance. This is where you find out the exact details of the insurance policy: what is covered and not covered, at what percentage, with what frequencies, maximums, limitations, exclusions, etc. Breakdowns need to be incredibly detailed if one is going to provide the patients with a halfway decent treatment estimate. A vast majority of patient complaints in dentistry can be traced back to missteps which occur when handling the breakdown process.
The challenge with the breakdown process is both the complexity of the information as well as the time involved. While some insurance online portals have become pretty good, they rarely provide enough information on limitations and exclusions. Therefore, the best way to generate a great insurance breakdown requires a phone call to the company, which often has a 20-40 minute on hold time. This can be quite time consuming for an internal team member. While there are ways to mitigate some of that timing to be more efficient, breakdowns are the major reason many offices choose to outsource portions of their insurance billing.
Preparing and sending claims to the insurance company is easy, and even offices that outsource all their dental billing tend to still send their own original claims. The time-consuming portion with claims is processing the resulting EOBs and handling denials and appeals. It does take a lot of knowledge to correctly process an EOB (I am writing a textbook purely for this). EOBs often contain errors, so learning to know when EOBs are right or wrong is a huge necessity. The challenge with outsourcing the claims process is that many outsourcing companies also do not process incorrect EOBs well, so you want to make sure they understand the nuances of EOB handling and do not just process EOBs which are in error as they are initially received. Double checking their work occasionally would be a good idea at the beginning if you choose to outsource this piece.
According to ADA research, the average dental office collects only 92% of the money they are due, which means 8% of everything the dentist and team must work hard for is unpaid (money that SHOULD be collected). This statistic is rather depressing, especially since achieving 99% collections is not a difficult achievement. Most of this problem tends to revolve around insurance. Was the patient verified they had insurance? Was the breakdown done well to create a good estimate (where the patient does not have a surprise bill later)? Was the claim sent and processed correctly? Did the team read the EOB correctly and find/correct any errors? And finally did the office have a good follow-up system to collect balances from patients?
Most dental billing companies handle verification, breakdown, and claims. There are a handful that also can take care of the total collections process for the office as well.
I have seen many offices transition to outsourcing because the team was not doing well with processing insurance claims in-house. And once outsourced, I’ve seen them transition from one company to another. The problem here is that most insurance challenges still originate with the in-office team no matter how much you outsource. To use an old computer term: garbage in equals garbage out. If you provide the 3rd party billing company inadequate information, they are not going to be able to fight claims on your behalf.
As an example, most claim denials for SRP, BU, Crowns, and other higher end procedures come from poor clinical documentation. Interesting aspect is that most dental offices think they have good documentation, until they see what good actually means. Remember, the insurance employees first checking claims are rarely dental professionals. They cannot extrapolate or infer anything; they can only go by the face value of what you send. These reviewers also have never seen the patient directly, and they are not going to assume anything you do not send or show them. Vague information often ends up with a denied claim.
Learning what information is needed for each type of procedure is highly important for success whether billing internally or through a 3rd party billing company.
Who to Choose
If you are considering outsourcing any or all of your dental insurance billing, there are a few questions you’ll want to research.
- Clarify Services. What services do you want the company to take over (verification, breakdowns, claims processing, and/or billing/collections)? Many companies do not do them all.
- Expertise and Handling of EOBs. What does the company do when they see an incorrect EOB if they are handling claims? Many of them just file the claim and do nothing because that is quick and easy, but it causes offices to lose lots of money. You want a company that will recognize erroneous EOBs and also communicate back to the dental office for more information so they can fight it.
- Dedicated Team Members. You will want to look for a company that provides you with dedicated team members, and not just whomever is available at the time. This allows them to learn your office better, and to function as an extended part of your team. If your office is just another number to them, what level of support do you think you will receive?
- Give you Feedback on Problem Trends. Fourth, you should be looking for a company that can provide you with enough information when they see challenges to be able to learn how to avoid future problems. Extremely few companies are capable of providing this level of support.
- History, Background and References. Finally, I suggest finding a company that has a good history and reputation. At Dental Insurance Guy we have seen multiple fly-by-night companies that have entered this market and ended in a short time.
You can see there are multiple factors to be aware of when looking into whether outsourcing is the right option for you. Members, if you have any questions, please ask me through our online Q&A portal.
To answer the number one question I receive: the billing company I’ve seen with the best overall process and which has had the most positive reviews from contacts is Resolv Healthcare. Their team has helped many offices I have worked with, and they are responsive. You can find more information here: https://resolvhealthcare.com/dentalinsurance.
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