In a previous post, we highlighted a few key questions to consider when signing with a dental benefit plan. A recent entry in the ADA’s Decoding Dental Benefits series sheds light on another important piece of the fine print: PPO leasing networks.
Network leasing defined
Network leasing occurs when a carrier (the “lessor”) has excess capacity and decides to lease out some of that capacity to another carrier (the “lessee”) in an effort to generate additional revenue. As the ADA outlines in detail, this business practice can have unexpected consequences for dentists who contracted with the original lessor carrier.
What network leasing means for the dentist
Without reading the fine print, dentists who contract with a PPO may find that they were contracted with other plans in the process, something that isn’t discovered until later, when their office submits a claim for services and receives an EOB with unanticipated restrictions tied to the lessee carrier.
In some cases, when fee schedules vary between the two carriers, it can be difficult for the office to estimate the patient portion for certain treatment costs. And if the office gets the number wrong, the owner is now confronted with a difficult choice: eat the difference or ask the patient to pay a higher amount after the fact. Not a fun conversation.
Contract and fee disputes may also take longer than usual to resolve, since these are handled by the lessee carrier—the carrier with whom the dentist doesn’t have a direct relationship.
But there are some distinct advantages to being part of a leased network, including greater visibility (to attract new patients) and broader coverage for procedures that would not have been included otherwise (also helps with patients).
The bottom line
As with all things contract-related, the details matter. The ADA recommends that dentists carefully review the affiliated carrier clause in any new contract to understand any lease agreements to which they may be bound.
Doing so allows a practice to weigh the full potential benefits and drawbacks of any plan before committing. Because no one likes surprises, especially when they affect the patient experience.