The Most Common Challenges: Understanding the Insurance Challenge

I answer questions daily from dentists and team members needing help on anything from insurance to practice management. Most people tend to have similar questions, so in this series I plan to address the most common questions that plague dental offices.

Understanding the Insurance Challenge

The prior article discussed how to gather great information—through verifications and breakdowns—to use when creating treatment estimates for patients. The next step is learning how to process that information correctly. Insurance can be extremely complex, but thankfully, it’s also highly predictable. It only seems unpredictable when it’s not well understood, which is quite common.

The solution, therefore, is to learn more about how insurance works so that it becomes highly predictable. This is how you can take good breakdown information and turn it into a solid treatment plan where you do not have to rely on the term “estimate,” which patients dislike. This ultimately leads to happier patients and near 100% collection rates.

First, let’s talk about Practice Management Software (PMS):

Most offices print off treatment plans where the computer calculates insurance for you. The problem here is “garbage in = garbage out. “Most PMS databases are clogged with incomplete or inaccurate insurance plan data, which means the computer has no chance to create a solid treatment plan and estimate. Therefore, there are two options for creating a reliable treatment plan:

1. Become very knowledgeable with the PMS and how it operates, to create great insurance tables, code by code.
2. Create treatment plans manually.

While it may be counterintuitive, option two is far easier for most. Insurance is complex, yes, but it’s also routine and follows systems. If you learn the systems, you can create treatment estimates quickly. Yes, they may take an extra couple of minutes vs having the computer do it, but you will save 10x that effort in avoiding problems on the back end, from collections to patient arguments. And even if you do rely on the computer to do most of it, you still need to understand when the computer is wrong.

Understanding Key Dental Insurance Terms

Insurance can be confusing, but knowing the key concepts makes it much easier to predict coverage and plan treatment. Here are the most important terms to understand:

Deductibles and Waiting Periods

• A deductible is the amount a patient must pay out of pocket before insurance starts covering certain procedures.
• Waiting periods are delays imposed by some insurance plans before coverage begins for specific procedures, like crowns or implants.

Maximums

• Insurance plans often have a maximum annual benefit, which is the total amount the insurance will pay in a year. Once a patient reaches this limit, they must pay out of pocket for any additional procedures.

Frequencies

• Coverage for routine procedures like exams or cleanings can vary. For example, exams might be covered:
• Twice per year
• Every 6 months plus one day
• Once per dentist
• Once per patient
• Some plans share coverage between family members or have unique rules—understanding these details prevents confusion.

Downgrades

• A downgrade occurs when insurance covers a less expensive version of a procedure than what was performed. This affects the patient’s copay but does not reduce what the office collects. Downgrades are very common.

Limitations and Exclusions

• Limitations are restrictions on how procedures are covered. For example:
• Bone grafts may only be covered if the patient has a specific “implant rider” on their plan.
• IV sedation might be covered only if all wisdom teeth are removed in one visit.
• Exclusions are procedures that are not covered under any circumstances. The most common exclusions involve restorations due to wear and tear (abrasion, erosion, abfraction, attrition). This means crowns, veneers, or certain fillings may be considered cosmetic or elective and not covered if done for these reasons.

Correct Coding

• Insurance reimbursement depends on using the correct procedure codes. Mistakes are common, such as:
• Coding an “implant-supported” restoration with an abutment incorrectly
• Alternating between codes like D1110 (prophylaxis) and D4910 (periodontal maintenance) incorrectly

Disallows

• A disallow happens when the insurance company does not automatically approve a procedure. It is not a refusal to pay but often a request for more information. Offices should know that insurance cannot tell you not to bill a patient unless fraud is suspected.

Denials

• A denial occurs when insurance refuses to pay a claim. Most denials happen because of:
• Missing or incomplete documentation
• Misunderstanding the patient’s benefits
• With proper knowledge and preparation, unexpected denials should be rare.

Whether an office is in-network, out of network, or fully fee-for-service, understanding insurance is key to a successful office because the patients still have insurance, they want your help in maximizing benefits.