1.13.17 Issue #775 info@mckenziemgmt.com 1-877-777-6151 Forward This Newsletter

Belle DuCharme, CDPMA
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Are you a FREE for Service Dentist?
By Belle DuCharme, CDPMA

Front Office Training Case Study #FO580

For this case study, the software reports sent to McKenzie Management prior to the office’s training showed an unusually high accounts receivable total in the 90-day plus aging category, along with suspicious adjustment totals. Essentially this means that services charged out had not been collected within the 30-day time frame considered required to sustain a thriving practice. As monies owed age from 30, 60 and then to 90 days plus past due, it becomes increasingly difficult to collect. Only about 20% of monies aged past 90 days are ever collected.

“Dr. May Bent” (names have been changed) included the following note in her pre-training questionnaire:

“I would like my front office team to be able to collect the money owed and I would like someone in charge who can teach them what to say at the desk. We don’t have job descriptions either and they both want to be the Office Manager. Please help them understand what to do to collect at the desk.”

While there are several issues here, we will look at the most important one and that is lack of revenue. Working with “Hanna and Betty” during the training became complicated when we approached the subject of who did what during the business day. They shared the job tasks but neither liked to answer the phone or call insurance companies about unpaid claims. The question as to why the accounts receivable was so high was answered by both with many excuses, but no accountability to the bad results.

“We don’t always have the time to get the insurance breakdown so we just tell the patient we will bill insurance then send a statement afterwards. When patients get the statement, they don’t like the fact that they weren’t told how much they would have to pay so we write some or all of it off to make them happy” explained Betty.

Hanna piped in and said that Dr. Bent often tells the patient she will take care of them by writing off the amount that insurance doesn’t pay or waiving the balance if no payment is made.

Dr. Bent was in-network provider for Delta Dental, Aetna and Blue Cross and had agreed by signing the contracts to collect the coinsurance from the patient. Per Delta Dental Insurance companies, one of the largest in the nation, the following statements are taken very seriously:

Accepting your insurance as payment in full and disregarding your coinsurance, copayment or deductible results in overbilling the insurance company. It's against the law in many states and is viewed by the dental profession as unethical. It’s also a violation of the dentist's contract with Delta Dental.

Dentists are not reducing their fee when they do not collect patient payments. Instead, these dentists are charging inflated fees to the insurance carrier to make up for the money they lose from waiving the coinsurance/copayment amounts.

Enrollees who knowingly agree to the dentist's scheme are participating in this deception.

Neither Hanna nor Betty knew that they were doing anything considered unethical or possibly illegal by writing off coinsurance. They both agreed it was certainly easier to do and the patients never get mad when you write off the balance. When explained to them that it was not an option to write off the coinsurance because of the contractual agreement that included the patient as a participant in payment for their services, they agreed they needed to collect.

Betty and Hanna’s poor collection skills didn’t stop there, they also did not collect from fee for service or cash patients without first offering them a 20% discount. If that didn’t work, the next was to offer them an in-house payment plan if they didn’t qualify for CareCredit financing. This was not working because patients were not paying as agreed, forcing the accounts receivables to grow and cash flow to stop.

We discussed that offering discounts to patients was assuming the fees were high enough to absorb loss of profit. Without a professional fee analysis to determine if their fees were justified for the area, it wasn’t known whether the practice could afford to offer discounts and 20% was considered too high to offer as a discount to anyone.

Developing collection scripts for Betty and Hanna helped them to understand what to say and why, and most importantly the reasons for collecting at the time of service.

To learn what to collect and how to collect, contact McKenzie Management and enroll in Front Office Business Training.

If you would like more information on McKenzie Management’sTraining Programs  to improve the performance of your team, email training@mckenziemgmt.com

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