Starting with a Clean Slate – Setting up a profitable PPO structure for a new practice

by | Mar 31, 2022

Home » PPO » Starting with a Clean Slate – Setting up a profitable PPO structure for a new practice

Acquiring, purchasing or building a new dental practice is an exciting endeavor but can be very overwhelming as you move toward opening doors and seeing patients. Practice owners feel a great amount of pressure to quickly become in network providers with the majority of relevant PPO plans so that the office can start gaining exposure and growing a patient base.

Many offices are anxious to get in network and will start completing and submitting applications to contract directly with all carriers. First off, if fees are not confirmed or negotiated beforehand, your office will be added to the standard fees for the area (which typically means 40%-50% write offs). Second off, many offices do not realize the potential involved with not only negotiating but using leasing to your advantage.

PPO leasing is when an insurance company allows their contract/fee schedule to cover or access other insurance plans. This means that you can be in network with any given plan through a variety of different fee schedules via these leasing arrangements. As you can imagine, if you had the ability to pick a fee schedule to use for a company, and have 10 to choose from, you of course will would choose the highest one possible.

PPO Negotiations and Optimization through leasing is a very important part of opening a new practice. Having a brand new TIN is a major advantage as you have the flexibility of setting things up in a strategic and profitable way to begin with rather than adding low paying contracts on default fee schedules and attempting to improve them over time.

There are a few key tips that can help navigate through this venture that will maximize your PPO revenue from the get go and set up your practice’s PPO with strategic contracting.

  • DO NOT blindly contract with all insurance plans! – Not only do you have the ability to negotiate fees prior to signing into an agreement, but you have many different options to choose from (why not pick the best?).
  • Start the process early! – If you know that you will be acquiring or opening a practice, it’s important to get started with making a strategy for your PPOs early on. Negotiating plans is key to maximized revenue for your new practice and that process can take between 1-3 months. Credentialing can also take an additional 30-120 days. Ideally, your practice may want to be in network with plans before opening their doors. That is a major advantage, but not worth undercutting your PPO collections by 50%-60%!
  • Get help from professionals! – We at e-DentalMarket not only negotiate with all carriers directly but all of their leasing options. We include dozens of plans that can be taken into account when setting up your PPO participation and know the ins and outs of how leasing can work to your advantage. PPO negotiations is not only for established offices and has even more value for new practices. Avoid credentialing companies that do not negotiate fees prior to submitting paperwork.

There are a few key tips that can help navigate through this venture that will maximize your PPO revenue from the get go and set up your practice’s PPO with strategic contracting.

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Financial Stewardship as a Dentist/CEO

Many providers are still unaware of PPO leasing, how it works or how to keep it from affecting the bottom line. Dental PPO leasing has pretty much leaked it’s way into every major PPO plan and the combination options to be in network are endless.

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“This is the second time we have used this company. Without a negotiation company there is no way I would have gotten higher fees. Last time they paid for themselves in a matter of just a few months. I anticipate the same to be true this time.”

Dr. Waggoner, NV