Key steps to follow when responding to patient refund requests

CDA Practice Support receives many member calls about refunding payments. Most often, these are refund requests to dental plans or patients due to quality of care and billing errors. Sometimes members ask about refund requests for treatment rendered to a recently deceased family member.

The starting point for any refund request is having a comprehensive financial agreement and financial policy in place for your practice. Such a policy is helpful in managing patient expectations regarding payment and refunds for treatment rendered.

Prior to starting treatment, it is important that the patient understands their financial responsibility and when payment is due. One best practice is to require payment at the time of service or with multistep procedures upon completion of treatment. This practice ensures your office is aligned with the CDA Code of Ethics and helps reduce the administrative burden on your front-office team.

Section 7 of the CDA Code of Ethics discusses billing practices and states, “A dentist has the obligation to submit any billing for services rendered or to be rendered in a manner which is not fraudulent, deceitful, or misleading.” The accompanying advisory opinion, 7.A.3. Billing for Services Not Rendered, goes one step further stating, “A dentist shall avoid billing for services not rendered. If payment has been received for a service that is ultimately never rendered, the dentist shall arrange to refund any overpayment immediately.”

Before issuing a patient refund, verify the reason behind the request. Is the patient requesting a refund due to concerns about the quality of care they received? Does the patient think they were charged incorrectly? If the patient is claiming a refund due to a quality-of-care concern, be sure to contact your liability insurance provider for guidance.

Next, determine the source of payment for the treatment. Did the patient pay for the treatment in full or was a dental benefit plan payment involved?

CDA recommends issuing refunds to the original source of payment. Therefore, if a patient paid for treatment out of pocket, the refund should be issued to the patient. If a plan was involved, be sure to check with the plan to determine the refund protocol. Some plans may require that you refund all monies to the plan and they will refund the patient their portion, while others may require documentation verifying that the patient’s portion was refunded to the patient directly. It is your responsibility to ensure refunds are distributed to the appropriate parties.

Once you’ve obtained the necessary information and decided to proceed with a refund, document your discussions with the patient and share any relevant and necessary information with your team members. In the event that the patient is requesting a refund due to an incorrect charge or quality-of-care issue, utilize the refund request as a learning opportunity for you and your entire team. Finally, document whatever conclusion is reached between you and the patient.

Handling a refund request from the family member of a deceased patient can be more challenging. Case in point: You recently completed a denture case for a long-term patient. You call a couple of days after delivery to see how the patient is doing and the patient’s daughter informs you that the patient has passed away. You are empathetic, as her father was a patient for many years and like family to you and your staff. The daughter wants to know if she can have a refund for the money paid toward the denture because he was not able to use it. While there isn’t an easy answer on how to proceed in this situation, there are considerations and consequences to be aware of. The primary consideration is the relationship you have with the patient and his family. You may consider refunding a portion of the treatment costs (minus the lab fees) or you may wish to refund all of the treatment costs.

If you choose to issue either the partial or full refund, verify with the administrator of the estate or executor of the will who should receive the refund. If you choose not to issue a refund on behalf of the deceased patient, understand the potential negative consequences, such as loss of other patients or negative feedback or reviews.

When it comes to patient refund requests, in general, my advice is to have constructive, informative conversations with your patient during your financial consultation. Make sure they know and understand your financial policy and their responsibility. Addressing these issues prior to treatment will preempt potential disputes once treatment is complete.

See the CDA Practice Support resource Patient Financial Protocols: Determining the Practice’s Patient Financial Options for more on financial policy, collections and the financial consultation.

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