Yesterday, insurance was such an easy game to play

Aug. 1, 1998
The days of dental insurance meeting the needs of both patients and dentists are long gone. The author takes a look at the way benefit plans are evolving.

The days of dental insurance meeting the needs of both patients and dentists are long gone. The author takes a look at the way benefit plans are evolving.

Tom M. Limoli, Jr.

A long time ago, in a galaxy (dental practice) far, far away, insurance paid for the clinical wants and needs of both the patient and the dentist. Those were happy times. The stock market was booming. The air we breathed was clean. The birds sang. And yes, gasoline only was 45 cents a gallon.

Benefit plans have changed drastically over the years. But why should we worry about these changes in plan design? Isn`t it the patient`s plan?

Yes, it is the patient`s plan. However, if we are going to file for benefits on behalf of the patient, it is our responsibility to do the best that we can. All too often, lack of knowledge on the part of the dental office results in unsecured benefits and unfulfilled expectations on the part of both the patient and the dental office. If we are going to provide the additional service to our patients of filing for their insurance benefits, we had best know how to properly handle the process.

What happens when we inform the patient that his or her benefit plan will participate in the reimbursement of dental care? The patient has a reasonable expectation that individual financial participation will be at a certain dollar amount. If the plan does not reimburse as expected, are we now looking for an additional and/or possibly inappropriate coding strategy? I surely hope not.

Primacy of coverage

Let`s begin our discussion of basic plan design with some specific examples, as they might appear in your individual dental practice. Reflect back to the first time you heard the famous Abbot and Costello skit where they discussed the strange names of baseball players. Do you remember the one? "Who is on first. What is on second." At times, primacy of coverage can be just that confusing.

When faced with a question of coverage primacy, three simple rules of engagement come into play:

1) The plan identifying the patient as anything other than a dependent is primary.

2) The plan without a true coordination of benefit (COB) provision is primary.

3) The plan with the lowest-dollar threshold is primary.

With Rule l, plans covering patients as employees, members, subscribers, beneficiaries, etc., take precedence (or primacy) over plans identifying patients as dependents. When confirming eligibility, first determine how the plan identifies the patient. Rarely, if ever, will a nontraditional managed-care plan of benefits be secondary. Nearly all of these alternate-funding plans identify patients as either members or subscribers.

Rule 2 is easy to determine once you have reviewed the patient`s benefit specifics. Remember that the rules of the plan are governed by the state in which the plan is bound - not the state where the dentistry is performed. Even though the patient is sitting in your New York dental office, the patient`s benefit plan may very well follow the rules and laws of the state of Illinois. Remember: True coordination of benefits occurs under the protection of individual state law and applies only if each of the plans involved specifically has COB provisions. If any plan is covered under ERISA (which pre-exempts state law) or does not include COB provisions, that plan cannot coordinate benefits with other plans and always will be considered primary.

Rule 3 concerning dollar thresholds is easy to determine. If your son or daughter goes to the toy store and finds two identical items that are priced differently (one is priced at $7 and the other at $12), which one will be purchased by the child? Yes, the lower-priced item will be purchased. Now, let`s say you have a contractual arrangement with a nontraditional plan of benefits (Delta Dental, the Blues, etc.) and crowns are scheduled at a $500 coverage level, but your usual fee is $700. The $500 coverage level is the lower-dollar threshold and is considered the primary plan of benefits, as well as the patient`s total financial obligation.

These rules of primacy are leading many of our patients` families to the conclusion that it is no longer financially beneficial for individuals to have multiple benefit plans. The rule of thumb for today and tomorrow is simple: have only one plan per family. The dental office should accept authorization for payment (assigned benefits) only with the patient`s primary coverage.

Exclusions and limitations

It is not at all uncommon for benefit plans to exclude reimbursement for services that are primarily cosmetic and nonrestorative in nature. Benefit plans have contained cosmetic exclusions since the late `50s and early `60s. It was not until the early `70s that the treatment of temporomandibular joint dysfunction (TMJ) became a line-item limitation. In many of today`s dental benefit plans, TMJ-related services are not as easily excluded, but they are limited to a certain dollar amount. Today`s standard plan of benefits most often will have a maximum TMJ limitation of only $300 to $500.

If your office has been filing claims in the absence of written and/or printed benefit-plan speci-fics, you and your patients undoubtedly have been caught in the web of modified prosthetic-replacement clauses. Remember, the old days when single- and multiple-surface restorations were routine benefits every 24 months? How about when full-coverage crowns were a benefit every five years. Well, we and our patients can kiss those days goodbye!

As you know, single- and multi-surface restorations now are most often a covered benefit for replacement after five years. In many of today`s benefit plans, crowns and fixed partial dentures have exclusionary periods for replacement of from seven to nine years. This limitation is nothing new to those offices that have been applying the information from both our Coding and Claim Submissions Manual and our textbook, Fee-for-Service Dentistry With a Managed-Care Component, as well as Volume 8, No. 4 of Dental Insurance Today.

Arriving recently on the scene are those traditional, nonmanaged-care plans that simply provide no benefit for full-coverage crowns. It doesn`t matter if the patient has an existing appliance that is 15 years old.

The routine replacement of crowns and fixed/removable partial dentures is not automatically approved as a benefit. Prosthetic replacements increasingly are becoming a patient out-of-pocket expense. In short, beware of the plan that does not cover crowns!

It is not uncommon for an employer to modify an existing, traditional benefit plan to meet labor-management financial objectives. One of the most popular plan modifications is to provide benefits only for crowns in the posterior sextants of the mouth.

Regarding surgical and nonsurgical periodontics, it is not uncommon to encounter benefit plans with $500 to $750 lifetime periodontal maximum. With many newly modified traditional benefit plans, root-planing and scaling (Code No. 04910) is only a reimbursable benefit following surgery.

The news is good for those offices that are willing to change with the demands of the marketplace. Apply old rules to new problems and the road to insanity awaits you.

Light at the end of the tunnel?

Concerning primacy of coverage, I recommend that you reduce your administrative and cash-flow burden by accepting authorization for payment (assigned benefits) from only the insured`s primary plan. The patient must pay his or her portion in full prior to or at the time of service. It also is not uncommon to establish a minimum threshold of $75 to $300 for assigned benefits. "If services rendered during this series of visits are anticipated to exceed $125, we will gladly await the insurance reimbursement provided all estimated copayments, deductibles, and out-of-pockets costs have been paid in full by the patient."

File the secondary benefits on behalf of the patient, but do not provide the payer with your Tax ID and/or Social Security number. Except where contractually obligated, do not accept assigned benefits on secondary coverage. Work with only one plan of benefits.

Changes in plan design

Actuaries and plan designers are listening to and fulfilling the request of labor/management benefit purchasers. In the arena of benefit-plan design, the purchaser of the plan drives the market. It is becoming quite common to find both traditional and nontraditional plans where prophylaxis is routinely benefited every four months. These same plans benefit inlays with onlay components as if they were full-coverage crowns.

With nontraditional managed-care plans, we find the most desirable plans to be those with the fewest number of covered services. Most commonly, we find newer plans only address palliative diagnostic and preventive services. These are nothing more than basic Phase 1 services. All other treatments are delivered at full or slightly reduced (5 percent to 15 percent) fee-for-service rates.

Not so long ago, we heard President John F. Kennedy say, "Ask not what your country can do for you; ask what you can do for your country."

About the same time, we heard America`s dental patients say, "If my insurance doesn`t cover it, I must not need it." Shortly thereafter, these same patients said, "If my insurance doesn`t pay, you obviously did something wrong."

In the very near future, we need to teach and allow our patients to say, "If my benefit plan doesn`t cover the total charge, I understand it to be my responsibility. I am glad to see your office still accepts cash."

Where do we go from here?

The plans have changed, but the patients still are the same. Isn`t that part of yet another problem? Is the dental profession selectively treating the same 60 percent of the U.S. population, while nearly half of the people visit the dentist only for emergency care?

Have you ever heard the story of the two competing shoe salesmen who are sent to an island in the South Pacific? Following a brief market evaluation, the first shoe salesman returns home with his head in his hand crying out, "Boo hoo, no one wears shoes." The second shoe salesman e-mails his office with a memo saying, "Urgent, send all available inventory. No one wears shoes!"

Like it or not, the largest and fastest-growing segment of the dental-office bank deposit is patient out-of-pocket costs.

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