Procedure vs. payment codes

March 1, 2003
Just because a specific procedure has an alphanumeric identifier does not mean that it will be reimbursed by the patient's benefit plan.

Tom Limoli Jr.

Let us rejoice!Our problems are over! The tooth fairy has come to our rescue, and now the wicked witch is dead. Now those nasty insurance companies will have to pay us! We have new codes. Isn't it great? Yes, CDT-4 is arriving in dental offices all over the country. With its new codes, updated terminology, and revised claim form, dentistry will soon be better armed for the remainder of this new millennium. Or will it?

Will more codes mean more money in your bank account? Will it get your patients any additional benefits from their plans? Will patients now have to pay you less because their plans now pay you more?

Let's get the ball rolling and briefly discuss the difference between procedure codes and payment codes. When your office renders care to a patient, that completed (intended) procedure is identified with its one and only appropriate procedure code. As far as HIPAA is concerned, these procedure codes are referred to as simply the "code on dental procedures and nomenclature." CDT-4 is not in the equation.

Once a claim reaches the office of the fiduciary agent, if the procedure code is also a plan-specific payment code, reimbursement is generated based upon the terms of the contract. If the submitted procedure code is not a valid plan-specific payment code, the administrators will either send you a denial of payment letter or change your procedure code to its closest allied payment code and send you a check for that.) Since most plan administrators are paid based upon the dollar value of the processed claim, they don't make money unless they change your procedure code to a payment code.

Like your bank, plan administrators make money by moving information (claim received vs. claim processed vs. claim paid). You pay your bank based upon the total number (service charge) of transactions over a given period of time (checks) or the dollar value (discount points) of the individual (credit card) transaction. That's why discount points are not a write-off.

If you code and bill the benefit plan for a completed procedure and that procedure is not reimbursed by the plan, you are bound by law (Title 18 of the U.S. Criminal Code) to collect that amount from the patient. Do not bill the benefit plan via the claim, then write-off the amount that is not reimbursed.

Two distinct areas need to be clarified: 1) noncovered services and 2) excluded services. Patients pay for noncovered services because they are not covered by a benefit plan. Examples would include onlays in place of crowns, as well as all porcelain posterior crowns. The patient does not pay for excluded services. Examples include pulp-capping procedures and restorations when they are done on the same tooth on the same day. Look carefully at your participatory contracts and reimbursement provisions.

While you're at it, take a look at the 2002 version of the ADA claim form and its data-element specific instructions. The treating dentist acknowledges with question/element No. 53 the following statement:

"I hereby certify that the procedures as indicated by date are in progress (for procedures that require multiple visits) or have been completed and that the fees submitted are the actual fees I have charged and intend to collect for those procedures."

Just because a specific procedure has an alphanumeric identifier does not mean that it will be reimbursed by the patient's benefit plan. Remember, the cart goes behind the horse!

Tom Limoli Jr. is the president of Atlanta Dental Consultants and the editor of Dental Insurance Today, a bimonthly publication that addresses third-party reimbursement in the dental office. He also is the author of Dental Insurance and Reimbursement Coding and Claim Submission. He can be contacted by phone at (404) 252-7808. Visit his Web site at

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