07/18/2013

Member Profiles: Shifting from predominantly HMO to PPO


The loss of adult Denti-Cal, an overall drop in adults seeking dental care, the decline in the economy and real estate market, increased regulatory compliance, reduced reimbursement rates...these are just some of the challenges dentists face in their dental practices. At what point do members consider changes in how they practice or ask for help to make changes in their practices? What kinds of changes should they consider? How do they implement these changes and still maintain practice production and income? CDA has heard from members, those seeking assistance and those who offer up their own experiences.

As part of an ongoing series, CDA is profiling members who have taken different approaches to how they practice.

Bruce Taber, DDS, has practiced dentistry for 25 years in Loma Linda and has participated in managed care plans since the mid ‘90s when employers in the area began offering Dental Health Maintenance Organizations (DHMOs) to their employees. Taber’s dental practice 18 months ago was comprised of 80 percent DHMO patients, the remainder being Preferred Provider Organization (PPO) at 15 percent and fee-for-service (FFS) at 5 percent.

“While I had a thriving practice, I was exhausted, seeing 35 patients per day and receiving upward of 60 new patient referrals each month,” Taber said.

Today, only 15 percent of Taber’s patient base is HMO and he has increased his PPO patient base to 80 percent, while FFS remains at 5 percent; essentially overturning the dental benefit plan types in his practice in just over a year’s time.

Based on Taber’s analysis, when he originally contracted with dental HMOs in the mid ‘90s, the number of procedures included in monthly capitation for some plans accounted for less than 20 percent of the procedures normally provided in a general dental practice. Therefore, approximately 80 percent of the procedures were non-covered or excluded, or were an upgrade from the covered benefit, requiring the dentist to charge the patient the full fee on those excluded or upgraded procedures. As the dental benefits marketplace evolved, plans increased the percentage of dental procedures falling under the capitation rate, thereby reducing those services that a contracted provider would charge the patient at full fee.

The dental HMO trends in capitation, seeing the residual impact on his practice production and realizing this wasn’t a sustainable model for the long term, led to Taber’s evaluation of his HMO provider contracts and how they impacted his practice. After carefully reviewing three months of billing, and taking into account the cost of providing care (Taber doesn’t differentiate treatment or materials based on reimbursement mechanism), he concluded that it was significantly less productive and cost effective to remain a contracted provider for a number of HMOs. It was clear that by reducing his HMO participation, this would allow time for increasing fee-for-service and PPO patients. The decision to alter the practice model made financial sense, but it wasn’t something that could be done over night. In order to maximize patient retention, the implementation of this change was calculated and gradual over the course of a year.  

“Making this type of change in the practice wasn’t easy,” Taber said. “But when I considered the alternative of shortening my career due to physical burnout, that frightened me more.”

In addition to having a committed staff with good organizational and scheduling skills, Taber credits the continuing success of his practice to several factors, the first of which is the customer service standard that he and his team subscribe to. 

“Treating my patients well and demonstrating appreciation for their trust in me as their dentist has been a part of our practice philosophy since I opened my office,” Taber said.

Taber and his team demonstrate this gratitude by acknowledging their patients’ milestones (birthdays, promotions, vacations, etc.) and treating each of his patients like family. He has built a relationship with his patients based on trust, and as a result, patient referrals have sustained his practice through the transition. In addition to personally following up with patients after their appointments, Taber is contracted with an online marketing and patient communications firm to monitor patient reviews of his practice and ensure patient expectations have been met.

Taber believes that offering a one-stop shop for his patients by extending a variety of services is another key to maintaining patient loyalty. Although he does refer patients out for procedures he is not comfortable performing, he does a wide variety of procedures in his office, providing convenience for his patients.

Additionally, Taber is a huge proponent of investing in continuing education and constantly improving his practice.

“Attending C.E. courses and remaining committed to dentistry are part of growing the profession,” Taber said. “Investing in your patients’ experiences by improving your skills and buying good equipment and materials for your office makes a difference, and they recognize it.”  

Taber also monitors the finances of his practice carefully so problems can be identified early. This  allows him to make the necessary adjustments and resolve issues before they become larger problems.   

While Taber notes that taking the risk to shift the model of his practice from predominantly HMO to PPO was high, he doesn’t regret the decision since it has allowed him to truly focus on what he enjoys most while providing quality dental care for his patients.

For tools and resources to evaluate dental plans and the impact to your practice, visit cda.org/compass.   



Topics: Membership