The Transition Advisor's Corner - Random Musings from the Front
The Transition Advisor's Corner - Random Musings from the Front
The purpose of this blog is to share current, real world, experiences on the topics of practice valuation, practice transition, retirement planning, and building equity value - over time - in your dental practice.
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seanepp
seanepp

“To participate, or not participate, that is the question.” - Hesy-Re

“To participate, or not participate, that is the question.” - Hesy-Re

8/5/2026 6:42:00 AM   |   Comments: 0   |   Views: 48
So, like, just WTF is dental insurance?  

For the vast majority of patients, dental insurance represents prepaid preventative services such as cleanings, imaging, and exams.  There may or may not be small co-pays associated with the preventative care.  Should that patient also need restorative care, their insurance plans buy them access to those services at predetermined discounts.  So, not really “insurance” in the sense of major medical or even property insurance.

For decades, the thought was something akin to, “I don’t really need to participate in every plan, but it likely makes sense to participate with a subset of plans that are relevant to my local market and patients.”  Said differently, dental insurance plan participation was an intentional choice and its goal was to deliver new patients.  Full stop.  Plan participation was a “cost of doing business” to get new-to-you mouths coming through the door.

The last two decades have been tumultuous.  The 2008 recession, the lingering impact of COVID challenges (workforce), the rising costs of education and student debt, insurance company reimbursement pressures, healthcare costs, real estate costs, interest rates, etc.

Many practices have hit their breaking point when it comes to being “par” or in-network (INN) or “non-par” or out-of-network (OON).  Over the last several years, we’ve witnessed an increasing number of dentists mindfully reducing the breadth of their plan participation.  Many have quietly transitioned from par to non-par with payors who were either too unreasonable and/or not material to their practice.  For most, it has not proven to be overly disruptive to either patients-of-record or new patients.  

In most markets, the PPO write-offs (“adjustments”) range from 20-35% depending on where UCR is set.  That represents hundreds of thousands of dollars in your typical practice.  There is likely a path to drive new patient flow differently and at a lower effective cost than blind insurance plan participation. [Marketing gurus please stand up!]

This is not an “anti-insurance” rant.  This is an “under your options” suggestion.  Horses for courses.  In most markets, it may not be commercially reasonable to exit Delta Premier.  However, there is likely a cohort of PPOs in your practice that merit scrutiny.  Maybe start small and dip out of a few plans here and there.  Next, try a slightly larger plan, maybe one representing ~10% of your active patients.  This is where things can get interesting.  There is usually an inflection point where you are indifferent to losing a certain number of patients because you are retaining so much more revenue from those patients who remain.

Work smarter, not harder.  Less is more.  Hakuna matata.

Good luck, have fun, don’t die!

Sean
Category: Ethics, Jurisprudence and Malpractice, Financial Planning and Investments, Health, Wellness and Ergonomics, Practice Management, HR and Accounting, Practice Transitions
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