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Breakdowns and Estimates by Dr. Travis Campbell

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Categories: Practice Management, HR and Accounting;
Breakdowns and Estimates 

Are you using the correct fee schedule? (INN, UCR, MAC)

by Dr. Travis Campbell

Insurance can be complex and highly detailed on a good day, and therefore, easy to get tripped up, even for the most experienced dental insurance coordinators. A pitfall we have seen recently occurs when offices compile their breakdowns and estimates and inadvertently use an incorrect “fee schedule.” In this article, I want to talk about the various fee schedules and their relationships to each other, highlighting where there are sometimes points of confusion that can result in an inaccurate estimate. Inaccurate estimates create surprise bills for patients, and then no one is happy.

Let’s start by reviewing the purpose and makeup of each of these rate schedules and see if we can provide additional clarification that may be helpful.

Full fee/Office fee
This is your dental office’s established fee structure, which outlines the rates you currently charge your patients for services rendered, regardless of insurance coverage.

UCR (usual, customary, and reasonable)
UCR is purely an insurance term, and it is very often misused. UCR is the fee schedule that an insurance company will apply to out-of-network (OON) claims. The UCR is unique to each insurance company regionally, and often even by zip code.

A common mistake is to confuse UCR and full fee. Full fee only applies to the office, and UCR only applies to insurance.

Note:
If UCR and office fees are the same number, the office should seriously consider raising its fees, as UCR is often derived from an average of submitted fees, minus a secret formula that the insurance company uses. To be equal, it usually means the office fees are well below average for the area.

If you want a non-biased fee comparison, use the free resource: fairhealthconsumer.org.

In-network
If your office is in-network (INN) with a specific insurance carrier, it is because you have chosen to join their insurance network and signed a contract agreeing to a discounted fee schedule for your patients who carry one of their insurance plans. It is very important to save both the contract that was signed as well as the fee schedule that was negotiated for each insurance carrier you are in-network with. INN offices will often need to refer back to that fee schedule. It is also helpful to load the fee schedule into your practice management software for easier reference.

MAC (maximum allowable charge or maximum approved charge)
MAC is a fee schedule developed by each insurance carrier for a subset of their insurance policies, specifically plans with lower premiums. MAC plans are developed and sold to employers who can’t afford (or choose not to provide) a higher level of dental benefits or premium payments for their business/employees. The number of MAC policies across the U.S. is currently growing.

A MAC fee schedule is therefore a lower-priced schedule that is below both UCR and the normal in-network (INN) fee schedules. A MAC fee schedule will apply to both in- and out-of-network situations. By way of comparison, MAC for OON offices often results in insurance reimbursing around half of the UCR fee table. With INN offices, the MAC fees are basically a downgrade across the board for all services, leaving the patient with a higher co-insurance.

Common mistakes involving EOBs
If your office is in-network with a given insurance carrier, then their discounted fee schedule is the only one you collect on. If one of your patients holds a MAC plan with that carrier, it only means insurance is reimbursing a smaller amount of the INN fees for that claim, and the patient therefore pays more. It should not affect the amount that your office is to collect in total.

Unfortunately, many explanations of benefits (EOBs) come through with errors and mistakes for both MAC and downgrades. This is why it is so important to understand that EOBs are not always perfect.

If you find EOB errors with either downgrades or MAC, remember you signed for a fee schedule, not the low-end reimbursement the patient’s policy is giving. Follow the fees you know, and not the incorrect adjustments on the EOB.

Breakdowns and estimates
The rates for MAC, UCR, and INN fee schedules can vary widely, and as a result, significantly affect estimates, for both in- and out-of-network cases. The breakdown of fees goes as follows:

Full fee > UCR > INN > MAC

And because there are an increasing number of MAC plans being sold, it is particularly important when obtaining a breakdown of benefits to ask whether insurance will reimburse on the MAC, UCR, or INN fee schedule to help avoid any surprise bills for the patient later. This should always be asked when reviewing an insurance verification form or when asking questions during a breakdown call with insurance.

Patient concerns
If the correct fee schedule is utilized when preparing an estimate, and the EOB is carefully scrutinized after the insurance review and payment decision, then your office should have fewer problems with estimates. If the estimate has been done properly, and then the patient has a concern/complaint with the lack of reimbursement, the best solution at that stage is to redirect their complaint to their employer’s human resources department. The HR department is the insurer’s true client and the only one that can clarify benefits and has a say in plan benefits for next year.
Author Bio
Author Dr. Travis Campbell is a practicing dentist and multiple-practice owner who lives in Prosper, Texas, with his wife and two young children. Having gained a reputation as an expert in the complex area of dental insurance, Campbell is commonly known as “The Dental Insurance Guy!” He dispels many of the myths and misinformation surrounding today’s dental insurance policies and explains how to navigate the complexities of being an exceptional dentist, business owner, and leader, while still having a life outside of work. His most recent textbook, Understanding Dental Insurance, has become a bestseller in dentistry and has already sold out twice. He has also launched the most comprehensive online resource for dental insurance: dentalinsuranceguy.com.
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