Every practicing medical professional has to deal with insurance in some form or the other. Insurance will cover the vast majority of treatments and procedures you perform. Some patients pay out-of-pocket, others use their dental insurance. Quite often patients even have multiple types of insurance (Medicare, Medicaid, private insurance etc.) that can pay for a particular procedure.
Dealing with dental insurance is not an easy task for most practices. Your interaction with the patient does not end once you have solved the issue. It only ends when you get paid for all the services you have provided. Figuring out the intricacies of benefit coverage, deductibles and copays can be quite frustrating.
Different Types of Dental Insurance
Every type of insurance and plan follows its own set of rules. Additionally you might have certain state specific legislation that constrains how much you can charge or from whom you can collect. In some states, it is possible to receive the highest fee allowed under multiple insurance plans and in other places it is the opposite.
Dental practices typically have the write off some portion of the bill. This is a difference between the full amount on the final bill and the total sum of all payments received for it (from insurance plans and the patient). A common problem that crops up is when the clinic writes off a certain amount after the primary insurance has paid. They then post another amount after the second reclaim comes through. This leads to inaccuracies in how you credit and close the patient account.
Another problem that crops up is the issue of deductibles and applicable co-pays. Sometimes the practice bills the entire amount to the insurance only to find out that the plan does not cover all the services or procedures. You then have to go back and bill the patient for the appropriate amount. The longer you wait to send a bill to the patient, the harder it becomes to collect on it.
Types of Coordination of Benefits (COB)
Coordination of benefits happens when you need to determine the various responsibilities for coverage when a person has multiple plans with similar or overlapping. When different plans are involved, each entity may be responsible for a part of the total bill. This process ensures that all the payments are handled appropriately under each insurance plan. It also ensures that there is no duplication of benefits for overpayment. How you handle COB will differ based on local laws, processing policies, the types of insurance and the types of COB used. As you might guess, there are different types of COB you can use.
The traditional method of applying COB means that the beneficiary receives 100% coverage through a combination of the primary and secondary insurance. In effect all their bills are covered and paid fully. Another method is maintenance of benefits under which the primary plan payments are deducted from the charges before applying the deductible requirements. In general, this type of COB pays less than the traditional method and the patient has to bear some cost.
Other types of COB include carve out and multiplication. As you can see COB is required to determine who is the primary and secondary insurer. You also need COB to calculate the correct amounts owed by the different entities as well as the patient. It is not just a matter of collecting the entire bill for your services. You also do not want to inadvertently break state laws or other relevant legislation when it comes to billing and claims. Understanding the types of insurance, the types of COB and their impact on your services is crucial to maintain the financial stability of your clinic.