Even if your dental practice is always busy and has many satisfied patients, there may still be a long road to travel before sustainable profitability is attained.
For the majority of dental practices throughout the U.S., their financial health rests upon keeping operational costs as low as possible, while optimizing revenue. And one vital, but often overlooked aspect of revenue management, is that of insurance reimbursement rate negotiations.
If you already work with experienced dental accountants, you might be aware of the significance of this, but if you don’t, here’s a brief outline of the importance of negotiating your insurance reimbursement rates for the long-term financial welfare of your dental practice:
- It can have a direct impact on your bottom line
In most instances, dental practices in the U.S. rely on insurance reimbursements for a large portion of their revenue. But when these rates are too low, dental practitioners may not be able to sustain, let alone meet the financial demands of running the business, even with a high volume of patients.
By negotiating more favorable rates of reimbursement with insurers, dentists can make sure that their revenue covers the costs of running the practice, while still having room for such important things as training, patient care and technology investments.
- When costs rise, so should reimbursements
With more stringent standards pertaining to infection control nowadays, upgrades to equipment, staff salaries and inflation, many dental practitioners are struggling to make ends meet. If reimbursement rates aren’t negotiated so that they increase in line with these rising costs, profit margins will dwindle and some practices may not be able to continue operating.
- You have the power to negotiate
While you might not realize it, insurers place a lot of value on dental practices that offer their patients efficient services (such as online eligibility verification and online claims submissions), run their practices in areas of the country where access to dental care is limited (and competition is lower), as well as attract and retain patients who may be their network members. By highlighting these things during negotiations, you can make a more compelling case for higher reimbursement rates.
- Negotiations driven by data yield better results
When you understand which of your current procedures generates the highest revenue, how often they are carried out, and what the gap is between the existing reimbursement rate, and the rate you would like, you can enter negotiations with a higher degree of confidence, and hopefully achieve better results.
- Patient perception is important
In many instances, patients look at the fees a practice is charging, as an indicator of the quality of care being given. Competitiveness is of course important, but equally, when your services are under-valued as a result of low rates of reimbursement, in can reflect poorly on patient perception.
- Negotiations should be carried out regularly
No fee schedule should remain the same year-on-year; by reviewing what you’re charging your patients and negotiating regularly with insurers, you can keep your fees aligned with the rest of the industry, while making sure you don’t miss out on opportunities to secure more favorable reimbursement terms.
Getting started with negotiations
Begin by gathering your practice data, before carefully reviewing the agreement with your insurance provider – you may find using dental accounting services to be helpful at this stage. Then, present your case professionally to your provider, and get any changes to reimbursement rates documented officially.
Reimbursement rate negotiation has a vital role to play in the long-term success of any dental practice, and is always worth dedicating time and effort to. If you’d like to know more about how to negotiate more favorable reimbursement rates from your insurer, seek help from a specialist dental accountant in your locality.