Navigating Dental Insurance Podcast (SayNoToPPOs.com)
Navigating Dental Insurance Podcast (SayNoToPPOs.com)
This podcast.blog teaches the best practices for cash flow, recurring revenue, Membership plans, PPO Fee negotiation, insurance best practices, marketing, reducing your dependence on dental insurance and building a fee for service practice.
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Jordon Comstock
Jordon Comstock

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The PPO Exit Calculator: Know Your Number Before You Go Out of Network

The PPO Exit Calculator: Know Your Number Before You Go Out of Network

8/18/2026 6:05:00 AM   |   Comments: 0   |   Views: 44

The PPO Exit Calculator: Know Your Number Before You Go Out of Network

There is a dangerous way to drop a PPO.

It usually starts with a dentist looking at an EOB, getting angry, walking into the office manager’s office and saying:

“That’s it. We’re done with them.”

I understand the emotion.

You perform the dentistry. You employ the team. You buy the supplies. You pay the rent. You invest in technology. You take the clinical risk.

And somewhere along the way, another company gets to tell you what your dentistry is worth.

Eventually, every dentist has that moment.

But anger is not a financial strategy.

Before you terminate a PPO contract, you should know one number:

How much revenue do you actually need to replace?

That is your PPO Exit Number.

And once you know it, something interesting happens.

Dropping a PPO stops feeling like jumping off a cliff.

It starts looking like crossing a bridge.

The goal isn't simply to drop insurance.

The goal is to build enough direct, recurring patient revenue that you have the financial strength to decide which insurance relationships still make sense for your practice.

That distinction matters more than ever.

According to the American Dental Association's Health Policy Institute, average GP dentist income was $215,320 in 2025. Over the previous five-year period, per-dentist revenue increased only 1.4% while expenses increased 4.9%. The ADA describes the resulting pressure as a continuing fiscal squeeze on dental practices.

The newest data makes the problem even clearer.

Since January 2021, dental equipment and supply prices have increased about 23%, and hourly earnings for dental-office staff have increased approximately 23%. But the reimbursement-rate index across dental payers increased only 19%, while overall inflation rose about 27%.

Your expenses aren't asking permission to increase.

Your PPO fee schedule might be.

That math eventually breaks.

Dentists Are Already Rethinking Their Networks

This isn't some fringe movement of angry dentists plotting a rebellion in a Facebook group.

The ADA's Q2 2026 State of the U.S. Dental Economy report found that 35% of dentists entered 2026 intending to drop out of some insurance networks.

By the second quarter of the year, 23.5% had already taken action to drop out of at least some networks.

And insurance isn't a side issue.

In an ADA HPI poll looking ahead to 2026, more than half of dentists identified insurance-related issues—including low reimbursement and delayed or denied payments—as a top concern.

So the question for many practices is no longer:

“Should we ever consider going out of network?”

It's becoming:

“How do we do it without blowing a hole in the practice?”

That's where the PPO Exit Calculator comes in.

Step 1: Find the Real Size of the PPO

Imagine your practice collects $150,000 per month.

One PPO represents $30,000 of that monthly revenue.

At first glance you might say:
“If we drop that PPO, we need to replace $30,000 a month.”
Not necessarily.

You're probably not going to lose every patient.

Some will stay because they love the practice.

Some will use out-of-network benefits.

Some will pay cash.

Some may move to your membership plan.

Others will leave.

Your first job is therefore not to calculate PPO revenue.

It's to calculate revenue at risk.

Start with:

Monthly collections attributable to PPO

Then estimate:

Percentage of those patients likely to remain

I would run at least three scenarios rather than pretending you can predict human behavior perfectly.

For example:
  • Conservative: 30% stay
  • Moderate: 50% stay
  • Strong retention: 70% stay
If the PPO represents $30,000 per month and you believe 50% of that revenue can reasonably be retained, your estimated revenue gap becomes:

$30,000 × 50% = $15,000/month at risk

Now we're solving a $15,000 problem instead of panicking over a $30,000 problem.

Step 2: Calculate the PPO Tax Before You Calculate the Loss

But there's another side to this equation that dentists frequently miss.

Not all revenue is equal.

Suppose one patient produces $1,000 of dentistry.

One payer allows $650.

Another patient pays your full fee.

Those aren't economically identical $1,000 procedures.

Your PPO may be producing revenue while simultaneously consuming margin through contractual adjustments, administrative work and lower reimbursement.

That means you should ask:

What am I losing by staying?

Calculate:

Your standard fee

minus

Your PPO allowable

equals

Contractual write-off

Then do it across the PPO.

If your normal charges for a group of patients total $50,000 but allowable fees reduce collectible revenue to $32,500, you're giving up:

$17,500

That's a 35% reduction from the original fee schedule in this simplified example.

And that's before considering the administrative work around eligibility verification, claims, denials, resubmissions, preauthorizations, EOB questions and collections.

This doesn't automatically make the PPO bad.

A PPO that fills otherwise-unused chair capacity profitably can still be valuable.

But you should know what you're trading.

Don't ask:

“How much revenue does this PPO generate?”

Ask:

“What is the economic contribution of this PPO compared with the resources it consumes?”

That's a much better question.

Step 3: Determine Your Membership Replacement Number

Now things get fun.

Let's say your calculated revenue gap after leaving the PPO is:

$12,000 per month.

Suppose your membership plan generates an average of:

$45 per member per month.

Your simple membership replacement number would be:

$12,000 ÷ $45 = 267 members

Suddenly the conversation changes.

“Can we leave this PPO?” sounds terrifying.

“Can we build 267 membership patients?” sounds like a project.

Those are psychologically very different problems.

But here's an important warning:

Membership revenue is not pure profit.

Your membership includes services that cost your practice time and money to deliver. Nor is $45 of membership revenue economically identical to $45 of clinical production.

So don't use this calculator as an accounting statement.

Use it as a strategic planning tool.

You're trying to establish the size of the recurring-revenue cushion you want before making a major payer decision.

Maybe your goal isn't replacing 100% of the revenue at risk.

Perhaps you decide:
“Once we have $8,000 of new membership MRR and strong patient retention data, we'll be comfortable exiting.”
Great.

Now you have a number.

The Most Important Part: Build the Bridge Before You Burn the Boat

This is where I think many PPO-exit strategies get backward.

They start with:

DROP THE PPO!

I prefer:

BUILD THE SAFETY NET.

Then make the PPO decision.

A membership plan allows you to create a direct financial relationship between your practice and your patients before you ask them to make a decision about insurance.

That matters.

Instead of telling a patient:
“We're dropping your insurance. Good luck.”
you can say:
“We're changing our relationship with your insurance company, but we've created another option designed to help patients continue receiving care directly through our practice.”
That's an entirely different conversation.

You aren't merely removing something.

You're offering an alternative.

Case Study: Nearly $500,000 in Recurring Membership Revenue

I've spent years watching practices build membership programs through BoomCloud, and the practices that impress me most don't treat memberships like a coupon.

They treat them like a revenue system.

Wood River Dental is a great example.

At one point, the practice had built membership revenue representing approximately $495,724 in annualized recurring revenue, based on BoomCloud customer data.

Think about that number for a second.

That's roughly:

$41,000+ in recurring revenue per month.

Before the practice opens Monday morning.

Before the doctor preps a crown.

Before hygiene starts.

Before the first phone rings.

Again, that money isn't all profit. Those patients receive benefits and care.

But financially, there is a massive difference between entering the month hoping patients show up and entering the month with hundreds of direct patient relationships already producing recurring revenue.

That's the strategic value.

The practice has built an asset.

Case Study: Replacing a $12,000-a-Month PPO

Another BoomCloud customer used membership growth as part of a strategy to replace approximately $12,000 per month associated with a PPO in less than six months, according to BoomCloud's internal customer case-study data.

This is the model I want dentists thinking about.

Not:

PPO ? nothing.

But:

PPO dependency ? membership growth ? recurring revenue ? greater freedom to choose.

Imagine sitting down with your team and saying:
“We're not dropping this plan tomorrow. We're going to build 300 membership patients first.”
Now everyone understands the mission.

Every uninsured patient matters.

Every retiring patient who loses employer coverage matters.

Every self-employed patient matters.

Every small-business owner matters.

Every family paying hundreds or thousands of dollars for coverage they barely understand becomes a conversation.

The team can watch the number move:

87 members.



Now the PPO exit isn't an emotional event.

It's an operational milestone.

Why Membership Plans Are So Powerful During a PPO Exit

There are several reasons.

1. They give patients somewhere to go

Removing an insurance relationship creates uncertainty.

A membership plan gives patients an alternative.

The patient can maintain a direct relationship with a practice they already know instead of immediately shopping for another in-network office.

2. They create predictable revenue

Traditional dental revenue has an unusual characteristic:

Every month, you essentially restart the scoreboard.

You need patients to schedule.

You need them to show.

You need treatment diagnosed.

You need treatment accepted.

You need the dentistry completed.

Then you need to collect.

Membership revenue introduces recurring revenue into that system.

That's why I believe recurring revenue is one of the most underappreciated financial tools in dentistry.

3. Membership changes the relationship



PPO patients often enter the financial conversation asking:

“Does my insurance cover it?”

Membership patients can have a much more direct relationship with the practice.

The practice designs the program.

The patient joins the program.

The practice controls the relationship.

4. You can build before you leave



This might be the biggest advantage.

You don't need to announce a PPO exit Monday and launch a membership plan Tuesday.

Build first.

Start with your uninsured population.

Then retirees.

Then self-employed patients.

Then patients losing coverage.

Then patients associated with a PPO you're considering exiting, subject to your contracts and applicable laws.

Grow the safety net while you're still standing on solid ground.

Your First Membership Patients Are Probably Already in the Practice

Practices often think they need more marketing to grow a membership program.

Sometimes they do.

But frequently, their first major opportunity is already sitting inside the patient database.

Look for:
  • Uninsured patients
  • Cash-pay patients
  • Patients whose benefits have terminated
  • Retirees losing employer-sponsored coverage
  • Self-employed patients
  • Families without dental benefits
  • Inactive patients
  • Patients declining preventive treatment because of cost
  • Patients attached to a PPO being evaluated for termination
Then train the team.

Because I've seen this over and over:

A practice technically “has a membership plan,” but almost nobody talks about it.

There is a tiny flyer sitting behind the front desk.

The hygienist doesn't mention it.

The assistant doesn't know how it works.

The checkout team forgets to present it.

The website barely mentions it.

Then six months later the doctor says:

“Membership plans don't work. We only have 27 patients.”

No.

You don't have a membership-plan problem.

You have a distribution problem.

I've personally watched successful practices make membership visible throughout the patient journey—clinical conversations, checkout, signage, team education and consistent presentation.

The plan isn't hidden.

It becomes part of the practice.

Run the Numbers Before You Make the Announcement



Here's the simplified version of your PPO Exit Calculator.

1. PPO monthly collections

Example:

$30,000

2. Estimated percentage retained after going out of network

Example:

60%

Estimated retained revenue:

$18,000

3. Estimated revenue at risk

$30,000 - $18,000 = $12,000

4. Current membership MRR available as a cushion

Example:

$4,000

Remaining gap:

$8,000

5. Average monthly membership revenue

Example:

$45

6. Additional membership members needed

$8,000 ÷ $45 = approximately 178 members

There's your target:

178 new members.

Now add a timeline.

Want to get there in six months?

178 ÷ 6 = about 30 new members per month.

That's roughly:

one member per day.

Read that again.

A scary strategic problem—

“How do we survive leaving this PPO?”

—has just been turned into:

“Can our entire team collectively enroll about one patient per working day?”

That is a problem you can manage.

Don't Confuse the Calculator With the Decision

A PPO Exit Calculator cannot tell you whether you should terminate a contract.

There are too many variables:

patient demographics, contractual requirements, local competition, reimbursement, procedure mix, unused capacity, patient retention, specialty mix, employer plans and your practice's financial position.

Review your actual contracts and get appropriate legal or professional advice before changing network participation.

The calculator does something different.

It forces you to stop operating on emotion.

It gives you a target.

And targets change behavior.

The Real Goal Isn't Dropping Every PPO

I don't believe every practice should wake up tomorrow and drop every insurance contract.

Some PPO relationships may make economic sense.

Some won't.

The objective isn't to become anti-insurance for the sake of being anti-insurance.

The objective is to stop being dependent.

There's an enormous difference.

If losing one PPO would terrify you, that payer has leverage.

If you've built substantial direct recurring patient revenue, the balance of power changes.

Now you can examine each contract independently and ask:

Does this relationship still make financial sense for our practice and our patients?

That's how business owners should make decisions.

Build Your Membership War Chest

Before dropping your next PPO, I'd do something that sounds much less exciting:

Wait.

Calculate.

Build.

Measure.

Then decide.

Find your revenue at risk.

Calculate the contractual write-offs.

Estimate different patient-retention scenarios.

Determine the membership revenue cushion you'd like to have.

Calculate how many members that requires.

Give the team a monthly target.

Track the number every week.

And build the recurring revenue before you need it.

At BoomCloud, this is a major reason we've spent years building technology around dental membership programs—not simply creating a plan, but helping practices enroll patients, automate recurring payments and renewals, identify opportunities, track membership MRR and ARR, and build a system around the program.

The software isn't the strategy.

The strategy is:

Own more of your patient relationship.

Build more predictable revenue.

Reduce financial dependence on any single third-party payer.

Software simply makes that strategy easier to execute at scale.

So before you send your next PPO termination letter, answer one question:

What's your number?

Maybe it's 100 members.

Maybe it's 300.

Maybe it's $10,000 in monthly recurring revenue.

Maybe it's $25,000.

Whatever it is, know it.

Because the strongest PPO exit isn't the one made with the most anger.

It's the one made from a position of financial strength.
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