the dentist’s guide understanding your patients’ dental benefits dental benefit plans nysda

The Dentist’s Guide

Understanding Your Patients’

Dental Benefits

DentalBenefit Plans

NYSDA

NYSDA

Home / Dental Benefits / Benefit Plan Provisions / Types of Plans / Fraud & Abuse / Claim Submission / FAQ’s

Table of Contents

Dental Benefits

Plan Provisions

Types of Plans

Fraud and Abuse

Claim Submission

FAQ’s

• Dental Benefits

• Benefit Plan Provisions

• Types of Plans

• Fraud and Abuse

• Claim Submission

• FAQ’s

Table of Contents

NYSDA


Table of Contents

Dental Benefits

Plan Provisions

Types of Plans

Fraud and Abuse

Claim Submission

FAQ’s

• What are dental benefits?

• Why employers offer dental benefits?

• Dental benefits and your practice

Dental Benefits

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What are dental benefits?

Provisions in the contract

between an employer and

employee that helps cover

the cost for the employee to

maintain or improve their

oral health.

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Companies give dental benefits to

• Decrease employee absences

• Prevent poor work performance

• Maximize profit margin

• Aid employee recruitment & retention

Why Employers Offer Dental Benefits?

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• Who has benefits?

• What are “benefit plan provisions?”

• How are “coordination of benefits”

determined?

• Is there an “assignment of benefits?”

• Are “co-payments” due?

Dental benefits and your practice

NYSDA


Who has benefits?

• Patients must verify “eligibility”

• Verifying a patient’s coverage is a courtesy

• A patient may not be eligible for benefits

• Unless dentist is a “participating provider,”

eligibility cannot be guaranteed

• Documentation of eligibility includes

“effective date of coverage”

NYSDA


Who has benefits?

• If applicable, the patient must

know the “expiration date”

• There may be a period of limited

coverage after the expiration date

called an “extension of benefits”

NYSDA


FAQ’s

Table of Contents

Dental Benefits

Plan Provisions

Types of Plans

Fraud and Abuse

Claim Submission

FAQ’s

• Parameters in the patient’s plan that affect their reimbursement*

• These parameters will help in determining the coordination of benefits, the assignment of benefits, and the amount of co-payment.

Benefit Plan Provisions

*These provisions should never influence the quality of care delivered to the patient.

NYSDA


Benefit Plan Provisions

• Limitations of Coverage• LEAT or LEPAAT• Pre-Existing Conditions• Exclusionary Period• Proof of Loss• Coordination of Benefits• Non-duplication of Benefits• Maintenance of Benefits

NYSDA


Limitations of Coverage

• Sometimes called “exceptions” or

“exclusions”

• Restrictive conditions in a dental

benefits contract affecting how an

individual or group is covered

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Limitations of Coverage

Examples:

• age restrictions – (ex.: sealants covered to age 12)

• time limitations – (ex.: children covered to age 21)

• waiting periods – (ex.: 3 months before coverage starts)

• benefit exclusions – (ex.: no orthodontics)

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Least Expensive Alternate Treatment

• LEAT, also called “the least expensive professionally acceptable treatment” (LEPAAT)

• Restricts benefit allowance to coverage for the least expensive method of treatment*

*Determination of benefits is independent of the final treatment decision made by the dentist and the patient.

NYSDA


Pre-existing Conditions

• An oral health condition that existed before the patient was enrolled in the dental benefit program

• Benefit plans will only cover a loss incurred while the patient is covered

NYSDA


Pre-existing ConditionsExample:

A patient missing a 1st molar

prior to coverage will not get

a benefit for a fixed bridge or

a removable partial denture

NYSDA


Exclusionary Period

The period of time, defined by

the dental benefits contract, in

which a reimbursable

restoration or procedure is

functional (its life-span)

NYSDA


Exclusionary PeriodExample:

If a replacement for a single

crown will only be reimbursed if

the original is greater than 5

years old then its exclusionary

period is 5 years

NYSDA


Proof of Loss

• Valid documentation of the covered

patient’s treatment includes dates, costs,

records, and approved codes and forms.

• This information is needed to determine

the financial liability of the company

providing dental benefit plan

NYSDA


Coordination of Benefits

• When a patient is covered by more

than one dental benefits plan

• The liability for each plan is

determined by the contract

NYSDA


Coordination of Benefits

Coverage will be designated as

“primary” and “secondary” with

assigned liabilities, benefits for

specific procedures, and

reimbursements by the plan

administrators.

NYSDA


Non-duplication of Benefits

By contract, many dental

plans will not give a benefit if

the plan is the patient’s

“secondary” coverage.

NYSDA


Non-duplication of BenefitsExample:

• Patient will not receive 100%

reimbursement for procedure usually

reimbursed by either plan at 50%

• Patient will receive only the 50% from

the “primary” coverage

• “Secondary” plan will not pay benefit

because of non-duplication clause in

the contract.

NYSDA


Maintenance of Benefits

• Assuming that the benefit of the

secondary coverage is higher

than the primary

• The secondary coverage will

reimburse the difference, if the

allowable has already been met

by the primary

NYSDA


Maintenance of Benefits

• If the benefit of the primary

coverage is equal or higher

then the secondary coverage

pays nothing.

• This preserves or maintains

the benefit, at least to the level

of the secondary coverage.

NYSDA


Table of Contents

Dental Benefits

Plan Provisions

Types of Plans

Fraud and Abuse

Claim Submission

FAQ’s

• Fee-for-Service

• Managed Care

• Discount / Referral

Types of Dental Benefit Plans

NYSDA


Dental Benefit Plans

Dental benefit plans generally

are divided into two categories:

– Fully insured

– Self-funded

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Fully insured plans

– The financial risk is transferred to the

insurance company.

– The plan and the insurance company

are subject to state insurance laws

and regulations.

NYSDA



Self-funded plans

– The worker’s employer, union, or group

assumes the financial risk.

– Self-funded plans are regulated

primarily by U.S. Labor Department

under federal ERISA statutes

(Employee Retirement Income Security

Act).

NYSDA


• Traditional Fee-for-Service

• Direct Reimbursement

• Indemnity Plans

Fee-for-Service Dental Plans

NYSDA


• Dentist provides service

• Dentist determines fee

• Patient pays for service

• No coverage. No limitations

• No exclusions. No third party

Traditional Fee-for-Service

Dentist PatientFinancial relationship

Medical-legal relationship

Traditional fee-for-service is not a dental plan, but is included in this presentation to provide us with the base line or null plan

NYSDA


• DR is a self-funded dental benefits plan

• Employee pays for treatment from any

dentist

• Employee reimbursed for dollars spent

on treatment

Direct Reimbursement

NYSDA


• Reimbursement dictated by employer’s

plan design

• DR is ADA’s recommended form of 3rd

party reimbursement

• Coverage is limited to the money in the

patient’s DR account maintained by the

employer


NYSDA


• Go to the ADA’s website for more info


Dentist PatientFinancial relationship

Medical-legal relationship

Employer

Financial relationship

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• Fully insured or self-insured plans

• Patients receive benefits regardless of

dentist they select

• Predetermined reimbursement for

specific services, regardless of dentist’s

actual charges

• Payments to enrollees or, with

authorization, to dentist directly

Indemnity Plans

NYSDA


• Fully insured indemnity plan relationships

Indemnity Plans

Dentist PatientFinancial

Medical-legal

Financial (Reimbursement)

Insurance Co. EmployerContractual

Authorization

NYSDA


• Self-funded plan relationships

Indemnity Plans


Medical-legal

Financial (reimbursem

ent)

Employer / Union / or Group

Autho

rizat

ion

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Limit coverage by . . .

– Using a “deductible”

– Use of a “UCR schedule”

– Having a “schedule of allowance”

– Establishing an “annual maximum”

– Paying for the “least expensive

alternative treatment” (LEAT)

Indemnity Plans

NYSDA


Deductibles

– A per patient or per family charge

that is not reimbursed by the

dental plan at the initial use of the

plan for its calendar year

– Requires patients out-of-pocket

contribution to fee

Indemnity Plans

NYSDA


The UCR Schedule

– UCR = “usual, customary, and

reasonable”

– Actually benefit company’s

proprietary basis for its

reimbursement allowance

– No defined relationship to any

dentist’s actual fees

Indemnity Plans

NYSDA


The UCR Schedule

– Determined contractually between

3rd party and plan purchaser

– Provides reimbursement based on

percentile of UCR schedule

– “Co-payment” equals difference

between plan’s allowable benefit and

dentist’s actual fee

Indemnity Plans

NYSDA


Schedule of Allowance

– Lists covered services and shows

how much the plan will pay for each

service. The patient is responsible

for the difference, the “co-payment”

Indemnity Plans

NYSDA


Annual Maximum

– Maximum amount that insurance

plan will pay during a calendar year,

after the patient has met required

deductible

– Establishes a limit of liability, per

individual or family

Indemnity Plans

NYSDA


Indemnity Plans

LEAT clause

– Restricts benefit allowance to

coverage for the least expensive

method of treatment

– Independent of the final treatment

decision made by the dentist and the

patient

NYSDA


• Preferred or Participating Provider

Organizations (PPOs)

• Closed Panel PPOs

• Health Maintenance Organizations (HMO)

Managed Care Plans

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Changes reimbursement

– Plan may reimburse dentist directly

– Patient may receive different reimbursement for

using “in-plan” or “out-of-network” dentist

Managed Care Plans

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Managed Care Plans

• Designed to reduce health care costs

• Presume over-utilization of treatment services

• Transfer portion of financial liability from 3rd party and patient to doctor

• Reduce alleged “over-treatment” through financial disincentives to treat

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Managed Care Plans

• Requires dentist to contract with managed care company or other 3rd party payer, directly or through subcontractor

• Subcontracting groups include:– IPA (Independent Practice Association)

– PPO (Participating Provider Panels)

– LLC (Limited Liability Corporations)

NYSDA


• Dentist’s fees limited by contract

• Services are either covered, or non-

covered, or excluded from coverage

• Co-payment for non-covered or

excluded services may be

determined by contract, otherwise it

is traditional fee-for-service

Managed Care Plans

NYSDA


• Fully insured managed care plan relationships

Managed Care Plans

Dentist Patient

Financial(non-covered)

Medical-legal

Insurance Co. EmployerContractual

Con

trac

tual

Fin

anci

al(a

ssig

nmen

t)

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• Self-funded managed care relationships

Managed Care Plans


Medical-legal

Employer / Union / or Group

Contra

ctua

l

Finan

cial

(ass

ignm

ent)

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Dentist Contracts - PPO

• Participating Provider

Organizations [PPOs]

• Contract with dentists for fee

discounts and other concessions

• Contract with insurance companies

or benefit plans to offer discounted

benefits through panel dentists

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Dentist Contracts - PPO

• Most common form of managed

care in dentistry.

• Dentists negotiate individually

with PPO.

NYSDA


Dentist Contracts - IPA

• Independent Practice Associations [IPA]

are a type of integrated group practice:

i.e., P.C., LLC

• Therefore IPA can enter into contracts

and negotiate fees on behalf of member

doctors

• Contracts with doctor-members

• Contracts only with HMOs to provide

dentists to treat HMO member-patients

NYSDA


Dentist Contracts - LLC

• Limited Liability Corporations [LLC] are a type of integrated group practice: i.e., P.C.

• Therefore LLC can enter into contracts and negotiate fees on behalf of member doctors

• Contracts with doctor-members• Contracts with PPOs, HMOs, or benefit

companies directly to provide dentists to treat patients enrolled in discount dental plans

NYSDA


• Contract with dentists for discounted

fees and other concessions

• May be fully insured (insurance

company’s risk) or self-insured

(employer’s risk)

• Cost employers less than similar

indemnity plan

Preferred Provider Organizations

NYSDA


• Employees select a dentist from a

network.

• Employees may have to pay a co-

payment to the dentist, depending

on the service.

• Employees may have a point-of-

service option.

Preferred Provider Organizations

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• Patients may receive some

benefit even when treated by an

“out-of-network” dentist.

• These patients get a significantly

reduced benefit.

• Patients pay the difference.

Point-of-Service Option

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Plan makes no reimbursement

when care is provided by non-

participating dentist

Closed Panel PPO

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Health Maintenance Organizations

• Contracts with individual dentists or groups (e.g. PPOs, IPAs, etc.)

• Benefit paid directly to providers, not patients

• Patients restricted or encouraged to see enrolled doctors to receive benefits

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Health Maintenance Organizations

• Transfers financial liability from third-party and/or patient to dentist

• Provides financial disincentives to treatment

• Popular with employers to reduce costs of health benefit package

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Reimbursement in Managed Care

• Fee-for-service

• Capitation

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Reimbursement in Managed Care

• Dentist contract with benefit plans or

group to accept specific fees from plan

• Fees may be discounted or eliminated

• Fees may be supplemented by fixed

patient co-payments

• Certain procedures may not be covered

• Dentist may forfeit ability to collect from

patients for certain treatment

NYSDA


Reimbursement in Managed Care: Capitation

• Fixed monthly payment, per

patient or family, regardless of

services rendered

• Does not alter dentist’s fiduciary

responsibility to deliver

appropriate care

NYSDA


Reimbursement in Managed Care: Capitation

Dentist’s income determined by:

– Negotiated capitation fees to dentist

– Size of enrolled panel assigned to

dentist

– Period of patient enrollment

– amount of treatment required by

patients in panel

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• Discount / Referral plan relationships

Discount / Referral Dental Plans


Medical-legal

Third Party Marketers

Contra

ctua

l Financial

Contractual

NYSDA


• Third party marketers establish

schedule of fees

• Dentists contract with third-party

marketer to charge enrolled patients

based on established fee schedule


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• Patients enroll for a monthly charge

• Patients given list of contracted dentists

• Dentists discount their normal fees in

exchange for prospective referrals

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• Plan pays no actual benefits

• Patients pay all dental fees directly to dentist

• “Coverage” limited to fee discount in dentist’s

contract with marketer

• Non-listed services may be discounted as per

the contract, otherwise traditional fee-for-

service

NYSDA


Table of Contents

Dental Benefits

Plan Provisions

Types of Plans

Fraud and Abuse

Claim Submission

FAQ’s

Examples of Fraud and Abuse

• Fee Forgiveness

• Coupons

• False Diagnosis

• Claims Padding

• Misrepresentation

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Examples of Fraud and Abuse

• Over-utilization

• Refund of fee to patient

• Upcoding

• Unbundling

• Billing for services not performed

• Other Fraudulent Schemes

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Actions Against Fraud and Abuse

• Restitution

• Civil litigation

• Criminal prosecution

• Professional Discipline

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Actions Against Fraud and Abuse

Professional Discipline:

– censure

– fines

– license probation

– license suspension

– license revocation

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Plan Regulation

• Plans are regulated by NYS

Insurance Laws

• Managed Care Plans (HMOs)

also regulated by NYS

Department of Health

• Self-funded plans are regulated

by US Department of Labor

NYSDA


How to Remediate Plan Violations

Violations of Managed Care Contracts

– Dentist may impose sanctions defined in

contract

– Dentist should consult with attorney

regarding contract violations

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How to Remediate Plan Violations

Patient Contract Violations– Utilize appeal procedures– Complain to plan– Complain to plan purchaser (i.e.

employer)– Complain to NYS Insurance Dept.– Complain to US Dept. of Labor (self-

funded plans)– Consult with attorney

NYSDA


Table of Contents

Dental Benefits

Plan Provisions

Types of Plans

Fraud and Abuse

Claim Submission

FAQ’s

Claim Submission

• Patient claim must specify type of

treatment received

• Date of service

• Name of treating dentist

• Dentist’s actual fee for patient’s treatment

NYSDA


Claim Submission

• Dentists are not required to submit

patient claims

• Dentists under contract to a managed

care company may be contractually

obligated to submit claims for enrolled

patients

NYSDA


Claim Submission

• Claim forms may allow patient to authorize

payer to send insured’s benefit directly to

the treating dentist

• This is purely a courtesy

• Authorization is NOT binding on the payer

NYSDA


When Submitting Claims . . .

Dentist must provide

– Accurate patient & provider information

– Accurate treatment information

• Date of treatment

• Types of treatment (CDT codes)

– Accurate fee information

– Timely claim submission

– Copies of records, when requested

NYSDA


Substitute Benefits – CDT Code Changes

• Carrier extends alternate benefit when treatment service is not covered

• Payment made for less expensive alternative when service is not covered

• If service is covered, alternate treatment must be clinically appropriate for patient

NYSDA


3rd Party Dental Consultants

• Anyone may determine whether the policy covers services and patient is eligible for benefits

• When rendering decisions about quality or appropriateness of patient care– Must be licensed dentist in state where

patient is treated– Evaluating patient care and treatment

planning are facets of the practice of dentistry

– All state regulatory statutes and guidelines apply

NYSDA


When may 3rd party deny a claim? (Indemnity)

• Patient not covered by policy• Services not performed• Dentist did not charge patient for treatment• Services not covered• Services exceed policy limitations• Deductible not met• Patient benefits expended• Benefits received exceed plan allowable• Claim submitted beyond allowable time

limit

NYSDA


When will 3rd party payer deny a claim? (Managed Care)

• Dentist not under contract in “closed panel” plan

• Services excluded from coverage

• Services do not conform with plan definitions for “medical necessity” or “standard of care”

• Dentist’s maximum reimbursement exceeded

NYSDA


When must a 3rd party payer pay a claim?

• Patient enrolled in plan

• Treatment services covered

• Treatment within policy guidelines

• Patient eligible for benefits

• Deductible has not been met

• Annual maximum not reached

• Allowable reimbursement not met by second carrier

NYSDA


When can claim denials be appealed?

• Treatment is covered by policy• Patient eligible for benefits• Denial based on “standard of care”• Denial based on “least expensive

alternative treatment” clause – and alternative is not clinically appropriate for patient

• Denial based on “medical necessity”• Question about qualifications of

consultant

NYSDA


How can denials be appealed?

• 3rd party payer must provide internal review of disputed claim

• 3rd party payer must then provide objective external review

• Peer Review – under certain conditions• Patient may sue for contractual

violations• Possible 3rd party legal violations

– Complain to NYS Insurance Department– Complain to self-funded plan under ERISA

to US Labor Department

NYSDA


Assignment of Benefits

• In true “assignment,” the doctor

becomes the benefit recipient;

e.g., No-Fault, Medicaid, some

managed care

• If payment is disputed, the doctor

engages in the dispute

• If no benefit is available, the doctor

loses recourse to seek payment from

the patient

NYSDA


Frequently Asked Questions

• E-mail questions to NYSDental.org

• Responses will be e-mailed back

• New dental benefit info will be posted

on this site.

the dentist’s guide understanding your patients’ dental benefits dental benefit plans nysda

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