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Jan/Feb 2022

INSURANCE SOLUTIONS

NEWSLETTER CBCT Coding, Dental and Medical Billing, and Strategies for Profitability

Cone Beam Computed Tomography (CBCT) technology provides doctors with highly accurate images of the oral structures (anatomical positions of the teeth, soft tissue, and bones), allowing improved diagnosis and treatment planning. Cone Beam CT scanning technology with 2D or 3D renderings enables the doctor to “see” critical anatomic structures for implant placement, oral surgery, orthodontic, periodontal, endodontic, and TMJ procedures.

IN THIS ISSUE 1 CBCT Coding, Dental

and Medical Billing, and Strategies for Profitability

7 Focus on a New CDT Code 8 CDT Code Set May Receive Significant Revamp

9 The No Surprises Act and Dental Practice

11 Penny Reed Now CEO of Practice Booster®

11 Discounted Fee

Schedule Scenario

12 The Great PPO Question 15 Practice Booster Q&A

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CBCT is a relatively new 3D imaging technology adopted by practices that provides a method to evaluate the anatomical positions of teeth and the makeup of the bone in a 3D image. An imaging unit (similar in size to a panorex machine) has an arm that revolves around the patient’s head in about 20 seconds. The CT acquires the axial, coronal, and sagittal data. The patient is exposed to radiation as the data is collected. An actual image is not produced. The data is captured and is stored, collated, and compiled into a 2D or 3D data pack. This data may be retrieved, assimilated, and viewed at a later time.

CBCT Guidelines for Dentistry The patient is exposed to radiation during any radiographic procedure. A CBCT should be performed only when necessary to provide clinical information that cannot be obtained using other imaging modalities. The FDA’s Initiative to Reduce Unnecessary Radiation Exposure from Medical Imaging states imaging professionals are advised to follow the principles of justification and optimization to protect their patients. Radiation doses from dental CBCTs are usually lower than other types of CT evaluations. However, dental CBCTs typically deliver more radiation than other conventional digital dental imaging modalities. Doctors must justify each radiographic examination on an individual needs’ basis, and the patient benefit of each exposure must outweigh the risks. The American Dental Association (ADA) outlines guidelines related to the use of CBCT by dental professionals in “The Use of Cone-Beam Computed Tomography in Dentistry: An Advisory Statement from the American Dental Association Council on Scientific Affairs,” as published in the August 2019 edition of The Journal of the American Dental Association (JADA).

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Insurance Solutions NEWSLETTER This article outlines a complete set of protocols that should be followed by dental practitioners when administering CBCT. For example, CBCT operators must receive “appropriate training and education in the safe use of CBCT imaging systems” and are encouraged to take continuing education classes to remain up to date on radiation protection. Additionally, all federal and state laws relating to dental imaging must be followed when operating a CBCT, and all imaging systems should regularly undergo compliance and performance testing. These quality control checks measure radiation control levels to ensure patient doses are kept as low as possible. When ordering a CBCT scan, the professional must use judgment to assess the current clinical situation and the necessity of the CBCT image. The CBCT should be interpreted by an “appropriately qualified healthcare provider,” such as a dentist, and the findings communicated to the patient and properly documented in the patient record. Dental practices should establish quality control programs to ensure all these protocols are being met. For the ADA’s detailed analysis of CBCT, visit http://jada.ada.org/ and search CBCT.

Benefits of CBCT CBCT images are useful in the diagnosis, treatment planning, and evaluation of various dental-related conditions. Since fewer images are needed for diagnosis, a single scan often provides the doctor with sufficient diagnostic information. More appropriate treatment recommendations are possible when patients are properly diagnosed. The American Academy of Oral and Maxillofacial Radiology (AAOMR) has determined that a CBCT should be produced and reviewed prior to surgical implant placement to help reduce potential risks. CBCT images are also often used to evaluate impacted third molars located close to nerves or other structures, or for analyzing temporomandibular joint (TMJ) abnormalities or pathologies. Furthermore, CBCT images can also be used for the fabrication of surgical guides and cleft palate assessment. CBCT also aids in assessing endodontic and orthodontic conditions, cracked teeth, periapical pathology, and hard and

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soft supporting periodontal structures leading to improved clinical outcomes. As more practices incorporate the use of CBCT, this technology has the potential to improve treatment outcomes, predictability, and to reduce the need for exploratory procedures, increasing the overall quality of care. While the initial cost of incorporating CBCT equipment is high, there is long-term potential for time savings.

Dental Coding For CBCT Proper Code on Dental Procedures and Nomenclature (CDT) coding to report CBCT and related services is determined by four variables: 1. Who captured the data/performed the scan?

2. W ho viewed and interpreted the image(s) that were produced by the CBCT? 3. What area of the head, neck, or body was captured by the CBCT?

4. What type of image was produced by the data captured (2D, 3D, fused, used in a simulation, or a subtraction process)? There are multiple codes to report several unique uses for CBCT, as outlined below. Note that CBCT codes are categorized by whether the prescribing doctor captures the image, interprets the image, or does both. The appropriate CDT code may also be determined by the position and size of the image produced and interpreted. The following codes describe the capture and interpretation of CBCT images: D0364 Cone beam CT capture and interpretation with limited field of view – less than one whole jaw D0365 C one beam CT capture and interpretation with field of view of one full dental arch – mandible D0366 Cone beam CT capture and interpretation with field of view of one full dental arch – maxilla, with or without cranium D0367 C one beam CT capture and interpretation with field of view of both jaws; with or without cranium

D0368 Cone beam CT capture and interpretation for TMJ series including two or more exposures

The following codes describe the CBCT image capture only (no interpretation):

D0380 C one beam CT image capture with limited field of view – less than one whole jaw D0381 C one beam CT image capture with field of view of one full dental arch – mandible D0382 C one beam CT image capture with field of view of one full dental arch – maxilla, with or without cranium D0383 C one beam CT image capture with field of view of both jaws, with or without cranium D0384 C one beam CT image capture for TMJ series including two or more exposures

The following code describes the CBCT image interpretation only: D0391 Interpretation of diagnostic image by a practitioner not associated with capture of the image, including report

The following code describes the postprocessing of images: D0393 Treatment simulation using 3D image volume

The use of 3D image volumes for simulation of treatment including, but not limited to, dental implant placement, orthognathic surgery, and orthodontic tooth movement. When cone beam technology is used to produce a 3D image, that image may be used to simulate treatment. D0393 may be used to report a 3D image to simulate implant placement by demonstrating where the implant should be placed to avoid critical oral structures. CBCT technology allows the doctor to virtually place implants into the 3D image to evaluate the size, position, and angulation best suited for the unique application, and to identify and avoid any obstacles that may exist (nerves, blood vessels, or any other anatomy that must be avoided).

Placing implants, appliances, and other prosthetic devices in the 3D image allows a dentist to assess the placement of the appliance in relation to the inferior alveolar nerve or maxillary sinus. This type of imaging can also evaluate the osseous structure of the TMJ region. While it has many applications, the CBCT image is the ultimate diagnostic tool for implant dentistry as the bony architecture and bone density of edentulous spaces can be clearly assessed. In addition, the 3D image provides the doctor with additional information about the position and location of structures that may be impacted during orthognathic surgery, therefore optimizing the end result while minimizing the possible risks by avoiding vital structures. A CBCT may be used to demonstrate soft tissue details of the skin surface in relation to underlying bony anatomy or to demonstrate muscles of mastication from MRI images in relation to their points of insertion in the jaws and surrounding tissues. In addition, orthodontists may use 3D images to optimize the results of the appliance and/ or implant anchorage placement. D0394 Digital subtraction of two or more images or image volumes of the same modality To demonstrate changes that have occurred over time. D0395 Fusion of two or more 3D image volumes of one or more modalities D0395 reports the use of cone beam technology to fuse two or more images or image volumes. The “hybrid layered” image can be used to evaluate the differences between the images or image volumes. Examples of use include precise registration of photographic images to cone-beam CT volumes or the fusion of CBCT/CT volumes to MRI volumes to simultaneously demonstrate soft tissue and hard tissue anatomy. By systematically adding (D0395) or removing (D0394) selected images or image volumes from the “hybrid layered” image, the doctor can more accurately assess changes in the structures that may have occurred over a period of time. This data is particularly essential when determining the

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Insurance Solutions NEWSLETTER progression of periodontal disease, the growth or reduction in the size of a lesion, or the status of site healing after surgery. These processes may also be used to illustrate changes during growth or subsequent to treatment. Furthermore, these processes can be used to evaluate changes in facial appearance or jaw position and for the measurement of airway changes following the placement of a mandibular advancement device to treat sleep apnea. Fusion can also be used to merge optical images to CBCT and images of the skin surface to CBCT, MSCT, or MRI volumes to create higher resolution and avoid radiographic artifacts. If CBCT technology is used to generate 3D images, report the applicable CBCT code. Smaller images such as periapicals (PAs), bitewings (BWs), or panoramic images (pans) can also be derived from the 3D data captured by CBCT technology. When this is the case, report the CBCT code that best describes the capture and request an alternate benefit of the image(s) produced in the narrative. It is important to note that it is considered unbundling to separately report the various images produced by the CBCT data capture. Most current CBCT units can be set to capture 2D images and bypass the 3D capture capabilities. In other words, most CBCT systems can produce individual images of varying configurations without using their full 3D capabilities. If 2D images are produced, these images are reported by the correlating conventional radiographic image codes. For example, submit D0330 to report a panoramic image produced by standard or digital panoramic methods when the CBCT machine’s 2D setting is used. (Remember, if the imaging system is set to capture 3D data, CBCT codes should be reported.) Report what you do, regardless of insurance benefits, or lack thereof.

Reimbursement for CBCT Images Reimbursement for Cone Beam CT’s is highly variable. Cone Beam CT is not generally reimbursed by dental. A Cone Beam CT may be submitted to medical as primary for reimbursement consideration subject to medical provisions. Documentation is essential. The clinical record must include the need

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for the CBCT, the field of view captured, and the interpretation of the image(s). Accurate, complete, and legible clinical documentation is the best tool available to establish medical necessity. Thorough documentation proving medical necessity will raise consideration for reimbursement. Regarding dental coverage, the reimbursement of a specific procedure is based on the dental plan design. Periodic dental radiographs, such as bitewing radiographic images taken routinely, are reimbursed and may or may not be associated with a specific dental procedure being performed. Thus, the clinical documentation must clearly support dental/medical necessity and meet the payer’s established criteria for reimbursement. Generally, CBCT scans are not covered by most dental plans, thus the patient would be responsible for payment. Medical coverage for CBCT varies by the medical plan. When possible, medical benefits should be verified prior to treatment. Some plans require prior authorization for CBCT imaging. Coverage by medical plans will be based on the diagnosis, or reason, for the CBCT scan and will not be covered for routine scanning for abnormalities. While medical plans do contain exclusions, coverage is based on proven medical necessity. An example of a typical exclusion (as it applies to dentistry) is that most medical plans specifically exclude dental implants from coverage, unless medically necessary due to trauma. Additionally, some medical plans may contain language that excludes dental restorations due to trauma when the affected tooth does not meet the plan’s definition of a naturally sound tooth (i.e., existing crown, decay, etc. prior to the trauma). As an example, if implants are excluded, then the CBCT associated with the implant would also be excluded. Generally speaking, a medical plan may consider reimbursement for CBCT when: (1) medical necessity is proven and (2) the associated dental procedure is deemed a covered service. For example, if the medical plan covers dental implants, then the CBCT required prior to implant placement may be considered. If the medical plan excludes coverage for dental implants, then the CBCT associated with the implant procedure is not likely to be reimbursed. Even if the patient’s plan includes

benefits for implants, coverage will be based on clinical necessity. The patient’s clinical record must clearly document the need for the CBCT, the field of view captured, and the interpretation of the image(s). Documenting all this information will help with reimbursement efforts for CBCT. Certain payers, such as Medicare, require National Imaging Association credentialing to prove the practice has implemented safety protocols and precautions for radiation exposure. This credentialing helps ensure the technology is being properly utilized. Adding CBCT technology to an existing contract is often a quick process and is well worth the effort for some practices. Circumstances when CBCT may be covered include:

§ Impacted third molars positioned close to the

K01.0 Embedded teeth (soft tissue impacted) K01.1 Impacted teeth (bony impacted – partial or full) K08.4049 Partial loss of teeth, unspecified cause, unspecified class K08.439 Partial loss of teeth due to caries, unspecified class K08.429 Partial loss of teeth due to periodontal disease, unspecified class K08.401 Partial loss of teeth, unspecified cause, class I M26.4 Malocclusion, unspecified M26.611 Adhesions and ankylosis of right temporomandibular joint

inferior alveolar nerve

M26.612 Adhesions and ankylosis of left temporomandibular joint

inferior alveolar nerve or maxillary sinus

M26.631 Articular disc disorder of right temporomandibular joint

be inadequate bone

M26.632 Articular disc disorder of left temporomandibular joint

§ Proposed implant placement close to the § Proposed implant placement where there may § TMJ abnormalities/pathology § Reconstructive or cosmetic surgery due to trauma or birth defects

Medical Billing for CBCT Medical billing requires BOTH procedural and diagnosis codes. Unlike dental billing, which is primarily reported by the procedure code, medical billing is typically determined by the diagnosis or symptom reported. In other words, it is imperative to tell medical payers WHY you took the CBCT, not just that it was taken. This is done using ICD-10-CM codes. Medical Diagnosis Coding The ICD-10-CM diagnosis code(s) reported must report the patient’s condition and the necessity of service. Never report a procedure or diagnosis code just because “someone told me this is how to be paid.” This is considered fraudulent billing by both dental and medical payers. Medical payers will reimburse for legitimate, covered services when submitted correctly and the criteria for medical necessity are met and documented. Only those conditions supported by the medical documentation should be submitted. Examples of possible diagnoses codes include, but are not limited to:

M26.69 Other specified disorders of temporomandibular joint S09.93XA Injury to mouth, initial encounter G47.33 Obstructive sleep apnea (adult) (pediatric) G47.63 Sleep related bruxism Again, this is a small representation of the available codes in the ICD-10-CM code set. Please refer to our book Medical Dental Cross Coding with Confidence for a comprehensive set of dentalrelated codes and how to report them. Copies are available at www.practicebooster.com/store. Medical Procedural Coding Corresponding Current Procedural Terminology (CPT®) medical codes for CBCT images are designed for the capturing and interpretation of images unless a modifier is attached to the CPT code communicating to the payer that it was a capture only or interpretation only. These codes are as follows: 70486 Computed tomography, maxillofacial area; without contrast material (when 3D imaging is performed, also report the appropriate code listed below)

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Insurance Solutions NEWSLETTER 76376 3D rendering with interpretation and reporting of computed tomography, magnetic resonance imaging, ultrasound, or other tomographic modality with image postprocessing under concurrent supervision; not requiring image postprocessing on an independent workstation 76377 3D rendering with interpretation and reporting of computed tomography, magnetic resonance imaging, ultrasound, or other tomographic modality with image postprocessing under concurrent supervision; requiring image postprocessing on an independent workstation 76380 Computed tomography, limited or localized follow-up study Note: CPT code 70486 reports the image capture and interpretation only. When 3D imaging is performed, it is reported with either CPT code 76376 or 76377. If only the image capture or interpretation is provided, use the appropriate modifiers to assign to the above CPT codes as listed below: • TC Technical component (i.e., image capture only) • 26 Professional component (i.e., interpretation only)

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If the same dentist reports both the image capture and the interpretation, no modifier is required, as noted above.

Strategies for Maximizing CBCT Profitability Frequently, CBCT scans are not a covered benefit by either dental or medical payers. That said, it is usually denied but not disallowed by PPO payers. That means the office fee or adjusted PPO fee can be passed on to the patient. An adjustment may be necessary depending on the state in which you practice. To get the most out of your CBCT, it is a better strategy to attach a lower, more accessible, cost to the procedure than a high one. Simply put, it is better to do 100 CBCT images at $100 each than to try and do 20 at $500 each. This improves the odds of case acceptance and allows the provider to access the data and imagery required to perform services with the highest quality of care. By definition, each exposure is considered one radiograph. Therefore, relying on software to simulate and extract different views, while possible, is not a separate billable fee. You cannot extract a panoramic view out of a 3D exposure and bill for both the 3D exposure and the panograph image. If you choose to use your CBCT to take panoramic radiographs, you may opt to bill using code D0330, which may be paid for through the patient’s dental plan, and then not bill for the CBCT scan.

Expanding on this, if the CBCT machine has a special bitewing mode, it usually captures two exposures which give the same amount of information as four traditional bitewing images. That said, because it was only two actual exposures, you cannot bill out for a four-bitewing set (D0274) even though the data were equivalent. You must charge what you do, which was two bitewings, or a D0272. If you wish to charge for four bitewings, it is better to use sensors or film and take traditional images, leaving the CBCT BW mode only for gaggers or those who cannot tolerate the sensors. Standards of care in dentistry are established by evidence-based review and continue to evolve. Reimbursement for the capture and/or interpretation of CBCT images is currently limited. As the appreciation and use of this technology increases and the patient benefit of the images captured are documented, the frequency and likelihood of reimbursement for CBCT imaging may increase in the future.

For more in depth instruction on medical coding, please reference our book Medical Dental Cross Coding with Confidence, available at www.practicebooster.com/store

Focus on a New CDT Code D3921 D ecoronation or submergence of an erupted tooth Intentional removal of coronal tooth structure for preservation of the root and surrounding bone. Rationale for adding D3921: The CMC approved this code submission by the American Association of Endodontists. The AAE requested this code to address a gap in CDT. The coronectomy code (D7251) is intended for use “when a neurovascular complication is likely if the entire impacted tooth is removed.” Its specific reference to impacted teeth and neurovascular complications restricts its use in other applications. The requested endodontic code will address the intentional removal of the coronal tooth structure when preserving the root to facilitate maintenance or continued development of the bone around ankylosed or fractured teeth. It also applies when an extraction is contraindicated due to a risk of osteonecrosis from radiation therapy or medications such as bisphosphonates.

Coding scenario #1: A 12-year-old girl has a history of dental trauma and avulsion three years prior. A root canal was performed on #9 at the time, and the tooth now appears ankylosed on the radiographs. Decoronation is performed, removing the clinical crown, and the gutta percha is removed. The submergence allows continued development of bone around the remaining root until an implant can be placed at a later time. The root would need to be removed before the implant placement. Coding scenario #2: A forty-year-old patient has a history of bisphosphonate use and there is a strong possibility of medication-related osteonecrosis. A decoronation is performed so that a portion of the tooth will remain in the mouth.

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Insurance Solutions NEWSLETTER

CDT Code Set May Receive Significant Revamp According to a recent article in the ADA News, the American Dental Association Council on Dental Benefit Programs is currently evaluating the CDT code set and may seek to make significant changes to the way codes themselves are structured. This may be in the form of greatly increasing the number of codes or using modifiers to the existing codes to make reporting more accurate and specific. Details like what materials were used or what steps were taken could be reflected in the proposed enhanced code set. The Enhanced CDT Code Task Force, created by the ADA Board of Trustees, has been taking suggestions and soliciting feedback on how best to rework the code set though written submission and with a series of listening sessions. They are trying to learn how the CDT in its current form is working or not working (and asking for examples), whether adding more codes or using code modifiers make

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the most sense, and what educational support would be required to successfully implement the changes. Most of this solicitation will be complete by the time of this publication, but further information can be found on the ADA website at https://www.ada.org/ publications/cdt, by emailing dentalcode@ada.org, or by phone from 8:00 a.m. to 5 p.m. Central time, Monday through Friday, at 800.621.8099. The CDT code set has not had a structural enhancement of this kind since it was first published in 1969. Rest assured, no matter what changes happen to the code set, Practice Booster will be there to keep you updated and will provide resources and training to help you implement the updates.

Sources: https://www.ada.org/publications/ada-news/2021/ december/task-force-soliciting-dental-communityinput-on-enhancing-cdt-code#.Ybfv7tpfYac.link

The No Surprises Act and Dental Practice With the new year came a new set of federal laws aimed at protecting consumers from surprise billing. The No Surprises Act is part of the Consolidated Appropriations Act of 2021, issued by the Department of Health and Human Services, the Office of Personnel Management, and the Departments of Labor and the Treasury. The law went into full effect on January 1, 2022. The intention of the law is to protect consumers against healthcare providers billing patients the

difference between in-network and out-of-network services without the patients being informed upfront about the costs. This can often happen in emergency situations; for instance, when a hospital emergency room is in-network for a patient, but the anesthesiologist attending during emergency surgery is not in-network. It can also apply to any patient receiving non-emergency care from out-ofnetwork providers at in-network facilities without upfront fee disclosures.

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Insurance Solutions NEWSLETTER In the past, the patient could be billed for the out-of-network fees of the provider (also known as balance billing), which could potentially amount to thousands of dollars. The No Surprises Act stipulates that out-of-network providers in this situation must accept fees equal to the in-network median contract rate or go through an Independent Dispute Resolution (IDR) process using an arbitrator to settle on a reimbursement amount. So how does this affect dentistry? As the law currently stands, the No Surprises Act applies to healthcare providers and enrollees participating with either group or individual health insurance policies. However, the definition of “health insurance policies” in the underlying law excludes short-term health policies and “excepted benefits,” which include standalone dental or vision plans. This means traditional dental insurances are not subject to the No Surprises Act. In addition, the American Dental Association went so far, in a statement dated December 13, 2021, to stipulate that private dental offices are not subject to the rule. This does not mean the No Surprises Act can be completely ignored by all dental providers. For example, combined medical and dental coverage plans are becoming more and more common and will be subject to the law. Even so, the law would only apply in situations where treatment is

performed in an in-network facility by an out-ofnetwork provider and the patient is not informed ahead of time about the cost of care. Furthermore, regulations are still being revised and are not expected to be finalized until late 2022. Any additional changes to the law that directly affect dental providers will be the topics of future Insurance Solutions Newsletter articles. As a precaution, until the rules are set in stone and fully understood, we suggest having the patient sign a detailed treatment estimate, prior to the date of service if possible. If treatment changes during a procedure, such as in the case of a pulp exposure, treatment should be paused long enough to obtain informed consent and financial consent, both signed by the patient. If potential changes are expected as a possibility, it is always best to have consent signed prior to beginning treatment. Any time the provider is out-of-network, it is advisable to include a statement on the financial consent establishing that the patient was aware of the payer-provider relationship. For example, the form may state, “I understand the provider is outof-network with my insurance and costs associated with treatment may be higher than with an innetwork provider. I understand I will be responsible for the difference, if any, in treatment costs and consent to care.” Even if the No Surprises Act has little effect on clinical practice, it is always advisable to obtain full consent in writing that the patient is aware of potential costs associated with care prior to starting treatment. Including this step in your standard practice protocols will help avoid issues with upset patients due to financial misunderstandings and potentially protect you in legal disputes over treatment.

Sources: https://www.ada.org/publications/ada-news/2021/ december/ada-addresses-no-surprises-act-questions https://www.commonwealthfund.org/sites/default/ files/2021-01/Surprise_Billing_Law_Summary_v2_ UPDATED_01-19-2021.pdf https://www.erisaclaimdefense.com/implementingregulations-for-the-no-surprises-act-part-i/

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Penny Reed Now CEO of Practice Booster® Practice Booster is proud to announce that Penny Reed has been named as their new Chief Executive Officer. Reed has over 30 years of dental industry experience, including 27 years of practice management, consulting, coaching, and business administration education. She has published two books: Growing Your Dental Business and Persuade With A Case Acceptance Story. She is also a nationally renowned dental

practice management coach, speaker, and author, helping dentists who want to grow their practices, become more profitable, and improve their quality of life. Practice Booster encompasses the full line of Dr. Charles Blair & Associates products and services, including Practice Booster, Coding with Confidence, Administration with Confidence, and Medical Dental Cross Coding with Confidence, the online Code Advisor database, Insurance Solutions Newsletter, the Clinical Treatment Analyzer, Dental Zing, and other resources. Designed to provide accurate and comprehensive billing, coding, and implementation tips, these resources ensure maximum reimbursement from dental insurance carriers while mitigating risk. Reed will also continue her role as the Director of Dental Zing, eAssist’s online dental education platform, which provides on-demand continuing education and training courses.

Discounted Fee Schedule Scenario Establishing a specific, discounted fee schedule for a local large employer could increase the practice’s client base without reducing revenue as significantly as becoming in-network with that employer’s PPO plan. If this type of arrangement were employed, how would it work? XYZ Manufacturing has a current indemnity plan with a reasonable fee schedule. Effective January 1, the company will switch its coverage to a PPO Plan. The PPO fee schedule is about 40 percent lower than the practice’s current fee schedule. However, the PPO’s out-of-network fee schedule is much better, only falling about 20 percent lower than the practice fee schedule. Additionally, the required copayments and deductibles are the same for in-network and out-of-network patients. In this scenario, could the dentist set up a special fee schedule for XYZ Manufacturing’s employees that is 15 percent lower than the practice’s regular fee schedule? If this were accomplished, would those patients only pay about 5 percent more out-of-pocket to be out-ofnetwork? How should this plan be designed?

§ Establish a fixed fee schedule that is around

15 percent below the practice’s regular fees. Thus, XYZ patients would pay approximately five percent out-of- pocket.

§ XYZ patients must pay any associated

deductible and copayment required by the plan. The practice cannot forgive any portion of the patient’s responsibility.

§ Check with a healthcare attorney in your state.

Be sure that this type of arrangement does not violate any laws or PPO contracts to which the practice is subject to follow.

(Note: In theory, the 15 percent lower fee schedule would not violate any PPO contracts that require the practice to assess the lower of the practice fee or PPO fee. Since PPO discounts are usually 30 to 40 percent, the 15 percent discount would not conflict with the PPO fee.)

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Insurance Solutions NEWSLETTER

The Great PPO Question By Penny Reed, CEO Practice Booster

Should you participate in a PPO network or not? While this question has been on the minds of dentists for years, the impact of Covid-19 has truly brought it to the forefront. The combination of increased stress due to infection control protocols, lack of qualified team members, and rising staff and supply costs, have dentists and office managers taking a second or third look at their numbers. Many are asking, is PPO participation right for us? Do the costs outweigh the benefits? Let’s evaluate whether now may be the time for you to join a plan,

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reduce the number of PPOs you participate in, or get out altogether. We’ll start at the beginning. I remember, nearly 30 years ago, when I began my career as a practice management coach, I was on fire to share the best systems and stats with dentists and their teams. I had a passion for sharing the best information and processes with offices and I truly believed that the reason most practices weren’t reaching their potential was that they simply didn’t possess the knowledge to do things a “better” way.

It didn’t take long before I realized that while many offices needed instruction to increase their patient flow and profitability, others had the tools but couldn’t figure out how to implement better systems or new ideas.

you may be able to stay out of PPO participation entirely, or at least limit your participation. A healthy practice should have new patient openings within a week and high production openings within one to two business days.

The same is true with PPO participation. Before we dive into the objective points on evaluating your level of involvement with PPOs, let’s look at the most complex and intangible aspect first — the culture of your team. Why begin there? Your practice culture consists of the values, beliefs, attitudes, and behaviors that you and your team consider essential. For example, if you believe that most patients will not go to a dentist who is out of network, that belief will do more to limit your success than any methodology or strategy for reducing your practice’s insurance dependency.

Just as important, if not more important, than tracking your write-offs is knowing your chair hour value. You should review this statistic at least once per year. Knowing your chair hour value helps you track the profitability in your practice in order to know if you can make money on a plan.

It would be so easy if the business owners could simply say, “We are going out of network with this plan on February first,” and the entire team would be on board with it. Every person on the team must have the same level of conviction as the doctor in order to convey to the patients the value of the care that your practice provides and congruently stand behind the way the practice manages dental benefits. It must be at the core of how the office communicates, not only in the office but also on the phone. This is truly the most challenging work and the most critical area to evaluate and overcome. Bear that in mind as you look at the following areas, which are easier to measure. Think of PPO participation as a marketing effort, because that is essentially what it is. The provider is paying to have their name listed with the PPO in order to increase patient numbers. That said, most practices should be spending at least 2% to 5% on practice marketing. If the practice is in a competitive market or is a fee-for-service office, that can be closer to 10%. By contrast, many practices are “spending” upwards of 25% to 30% for the marketing that the PPOs generate for them in terms of their write-offs. Prepare to have a strong marketing plan and be ready to invest more than you are likely spending now on other forms of advertising if you are considering reducing or eliminating PPOs. It is also imperative to measure open chair time. If you have very little open chair time and you schedule patients effectively, this could mean that

Chair hour value is calculated by reviewing the following (figures below are referenced for the previous 12 months):

§ Number of hours the office is open to see patients

§ Number of chairs utilized in the practice for

patient care (total number of chairs, for both operative and hygiene, if applicable)

§ Practice collections § Practice income statement (showing all expenses by category)

§ Monthly notes payable, which aren’t reflected

on the income statement. This may include but is not limited to the practice purchase note, equipment notes, etc.

First, you will multiply the number of hours the practice is open times the number of chairs utilized for patient care. For example, in a practice open five days per week with five chairs that is closed ten business days per year, the calculation would look like this: 50 weeks of patient care per year, times 40 hours of patient care per week, times 5 chairs utilized for patient care equals 10,000 chair hours per year available for patient care and revenue generation Next, take the last 12 months’ collections, and divide it by the number of chair hours the practice had available. In this example, we will use $1.5 million in collections. $1,500,000 collections divided by 10,000 hours = $150 per chair hour collections In a practice with a 98% collections ratio, this is $153 per chair hour production.

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Insurance Solutions NEWSLETTER So now we know what the practice generated per chair hour is, we need to see what the breakeven is per chair hour – also known as our cost per chair hour. This is done by finding the overhead dollars from the income statement (again for the last 12 months) and the annual amounts spent on practice and equipment notes, which most often aren’t reflected on the income statement. In this example, the practice has an overhead (expenses not including doctor’s salary) of $900,000. Here is the recommended way to segment these expenses for computing chair hour costs. For this calculation, we figure existing or base staff salaries as a fixed cost. The reason is that unless they are on commission or you send them home when the schedule is light, you are spending those dollars on staffing. A little later, we will cover how to factor in adding staff and its impact on the chair hour cost. Fixed costs (for chair hour cost calculation) Approximately 40% Rent or Building Note Build-out and/or Renovation Note Equipment Note Staffing Cost Payroll Taxes (staff only) Other Taxes Legal and Accounting Professional Dues Consulting and CE Travel Business Insurance Postage Utilities, Internet, and Phone Repairs and Maintenance

Expenses of $900,000 for the last 12 months, divided by 10,000 chair hours equals $90 breakeven per chair hour. This means, based upon the days and hours worked and chairs utilized, each chair must generate $90 per hour simply to cover overhead. Why is knowing the breakeven per chair hour so important? When evaluating insurance plan participation or adding and/or staffing additional chairs, it’s critical to know the overhead per chair per hour. This will tell you whether or not you will make money, and how much, for adding additional working space. It will also tell you whether you can afford to participate in certain plans based upon their reimbursement. There are many ways that knowing your breakeven or cost per chair hour can help you to make decisions. Refer back to the practice in our example. Let’s say there is a 6th room that is equipped and ready to use but has not been staffed and you are thinking of adding additional hygiene days to the schedule. If you added three more days of hygiene per week, this would result in an additional 1,200 chair hours added per year. Now let’s look at the cost of staffing that additional room. Say your staff cost will increase by $45,000 and your additional costs will be the supplies used to see those additional patients. If the hygiene chair produces $1,200 per day, and supplies run approximately 5%, the supplies will run approximately $60 per day. Therefore, the additional annual overhead to book hygiene in the 6th room, three days per week, will be $54,000. Let’s see how that changes the numbers. We’ve added 1,200 chair hours for a total of 11,200 chair hours annually. And now our overhead (if we take the last 12 month’s figures) would be $954,000. Therefore, our new breakeven per chair hour is $85.18.

Advertising Expense

Remember, knowledge is power, and the more you know about your practice statistics, the better decisions you will make. Before you make any decisions regarding PPO participation, add another team member, operatory, or an associate, be sure you know these numbers so you can project the financial impact it will have on your bottom line.

Bank and Credit Card Expense

Sources:

Variable Costs – Expenses that increase directly with production – Approximately 20% Lab Dental Supplies Office Supplies

Now that you have your expenses listed and tallied, you can review your overhead per chair hour, also known as “breakeven per chair hour.” 14 JAN/FEB 2022 ISN_Jan-Feb-2022.indd 14

PBQ&A

Answers to real questions asked by Practice Booster subscribers We received a newsletter for Sep/Oct Q 2021 and noticed that a new code, D3911,

at that time? Do you anticipate this code being paid by insurance companies, inclusive, paid or not covered?

would be added in 2022. Our practice is considering charging this code in 2022 but need some additional information if possible.

Also, sometimes we do not finish the RCT in the first visit. Some patients we start the RCT, and they come back to finish the RCT at a later time. Would we charge out the code D3911 twice, if the patient goes back to the general dentist and we do not place a permanent filling?

We are an endodontic practice and were wondering if we would be able to charge this out for instance when a patient is referred to our office for a RCT, but the general dentist wants to provide the core buildup, would we use this code

Thank you for all your help!

he D3911 code is for placement of an A Tintraorifice barrier which is placed over the final root canal therapy filling material upon completion of treatment, if the final restoration is not being placed at that time. It would be appropriate to place the barrier upon finishing the root canal and sending the patient back to the restorative dentist for the core buildup. It would not be appropriate to use the code if the treatment is not completed and the tooth is dressed with calcium hydroxide. You would not use the code twice on the same tooth. We do recommend obtaining feedback from the doctors in your practice in terms of

determining when to utilize this code on an individual basis. As with any new code, insurance companies will pay at their discretion. The important thing for providers to do is to use the code when doing the procedure and submit it to the insurers so that they can see that it is important for patients. In addition, the information that is collected when these codes are used may help to build a database that can establish improved prognosis when placing the intraorifice barrier upon completion of root canal therapy.

Have you purchased 2022 coding and insurance administration guides for your team? Visit www.practicebooster.com/store to order today!

JAN/FEB 2022 15 1/17/22 10:32 AM

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