Dental insurance coverage plans vary widely, and estimating out-of-pocket costs isn’t easy. A mistake or breakdown in communication can lead to a patient having to pay more than they bargained for, which can damage the patient relationship and even lead to non-payment.

The good news is that there are ways to increase the accuracy of these estimates, and we’ve found three tips along with suggestions about how to communicate estimates with your patients to avoid misunderstandings.  

Why Calculate Out-of-Pocket Costs?

When a patient wants to know how much a procedure will cost them, they want numbers. An answer of “It depends,” or “We’ll check with your insurance and get back to you on that” can lead to delays and even hesitancy about following through with a procedure.

If your office is able to accurately calculate out-of-pocket, you’ll have a figure in hand much faster than waiting for a predetermination from the insurance company. As a reminder, a predetermination involves getting an estimate from the insurance company in advance of treatment.

Instead of waiting for a predetermination from the insurance company, your office can calculate these costs and provide a prompt answer to the patient. To aid you in this process, we’ve outlined the top three mistakes offices make so that you can avoid falling into the same trap.

3 Mistakes Dental Offices Make When Estimating Dental Out-of-Pocket Costs

Whether you’re using software to calculate costs or you’re doing it by hand, three mistakes can throw off your calculations.

1. Failing to apply deductibles first: Dental coverage plans vary, and some are subject to a deductible, even for preventive care. A common mistake is applying the cost of the deductible after the copay instead of before. This error results in underestimating a patient’s out-of-pocket costs.
   As a reminder, subtract the deductible from the cost of the treatment first. Then apply the percentage of patient responsibility to that figure.  

2. Failing to apply downgrades: A downgraded procedure is one in which the insurance company classifies a procedure as a downgraded procedure. For example, you might perform a composite filling on a patient for $200, but the insurance will only pay the cost of the downgraded amalgam filling procedure at $100.
   Here, if insurance pays 80% of the cost, the patient will get relief of $80, not $160, and their total out-of-pocket cost would be $120 instead of their anticipated $40 price tag.

3. Relying on predeterminations: As discussed above, a predetermination is an approximation or estimate only. The overall cost of a procedure is likely to vary, and using a predetermination as a final number is likely to lead to a mistake.

Tips to Increase the Accuracy of Out-of-Pocket Cost Estimates

While you won’t necessarily be able to calculate out-of-pocket costs to the exact dollar, you can come within a decent ballpark if you follow these tips:

• Verify insurance coverage: Before you calculate any costs, be sure you know how much dental insurance your patient has and what dental benefits it covers. You can easily do this using Dental Intelligence Insurance to verify the patient’s insurance before they are in your office.
• Have accurate settings in your dental payments software program: As the saying goes, “garbage in, garbage out,” so if you want the correct calculations, you must have the right inputs. Dental Intelligence makes it easy to accurately collect the patient portion with Payments.
• ‍Thoroughly review the treatment plan: Double and triple-check your calculations before presenting anything to the patient. As you review the plan with the patient, you can run through the calculations again as a final sanity check. Dental Intelligence Treatment Plans allow you to create custom digital plans within moments that can be presented to patients.

A Final Note About Out-of-Pocket Costs and Preserving the Patient Relationship

Dental practice management experts recommend showing a patient the estimate of the full cost of a treatment plan before discussing what their insurance company will cover. This tactic allows you to determine how motivated a patient is to pursue a treatment path, regardless of what their health insurance pays.

When you do reveal the estimated out-of-pocket costs, be clear (and repeat it as many times as possible) that you are providing an estimate only. The actual costs may vary.

To learn more about how Dental Intelligence can help you collect more payments with less pain, verify insurance quickly, and more; schedule a demo today.