Running a dental practice involves making decisions that affect your patients, your staff, and your bottom line. One of the most challenging questions you may face is whether to drop an insurance network. Insurance participation can boost patient flow, but it can also cut deeply into reimbursements and limit your ability to set fair fees. Deciding if the time is right to step away from a network requires careful analysis and strategy.
Evaluate How They’re Impacting Your Profitability
The first step in deciding whether to drop an insurance network is understanding how it affects your profitability. While a high volume of patients may seem like a good thing, low reimbursement rates can undermine your revenue.
Consider:
- Fee schedule analysis: Compare the insurance network’s reimbursements against your usual and customary fees. If you are consistently being paid well below your standard rate, the network could be costing you money.
- Case mix: Consider the types of procedures covered by the plan. If the majority of services are reimbursed at reduced rates, profitability will suffer even if patient volume is high.
- Administrative burden: Networks often come with extra paperwork, pre-authorization requirements, and claim resubmissions that eat into your staff’s time and productivity.
If the numbers show that the network creates more losses than gains, it may be time to seriously consider whether to drop an insurance network.
Consider Patient Retention
Before you make a final decision, think about how leaving a network might affect your patients. Some patients may leave if their insurance no longer covers visits to your office, while others will remain loyal because of the care and service they receive.
Ask yourself:
- How much of your patient base depends on this insurance plan?
- Are these patients likely to pay out-of-pocket or switch to another plan to continue seeing you?
- Do you have strong relationships with your patients that could encourage them to stay regardless of insurance coverage?
If your dental practice has built a reputation for quality care and excellent service, many patients may follow you even if you drop an insurance network.
Consider Your Alternatives
Deciding to drop an insurance network isn’t something you should do abruptly. Timing and planning play a big role in whether the transition is successful.
Here are some strategies to keep in mind:
- Assess your payer mix: If a large percentage of your revenue comes from one network, dropping it could create a sudden cash flow gap. However, if the network represents only a small portion of revenue, the impact may be easier to absorb.
- Plan your exit: Networks usually require advance notice, sometimes 90 to 120 days, to terminate your contract. Make sure you review the terms carefully before moving forward.
- Build alternatives: Consider strengthening relationships with other networks that reimburse better, or grow your fee-for-service patient base. Launching or promoting an in-office membership plan can also cushion the transition.
By carefully choosing when and how to drop an insurance network, your practice can avoid unnecessary financial strain and set itself up for long-term success.
Make Billing Easier with APEX Reimbursement Specialists
Dental billing doesn’t have to be a source of stress and lost revenue. With the right partner, your practice can benefit from outsourced dental billing in multiple ways. APEX Reimbursement Specialists is here to help. Contact our team today by calling (410) 710-6005. We look forward to working with you to make your practice a more profitable place.