Understanding dental plan audit authority

The new Congress and administration in Washington are negotiating legislation that would considerably dismantle the Affordable Care Act as one of their first objectives. While it remains to be seen what this repeal and replacement of the ACA will look like, one aspect of the ACA that will likely survive is the idea and objective of “affordable” health care. Controlling costs of all health care, across the board, was one of the goals of the Affordable Care Act, albeit an elusive one, and controlling costs will likely remain a priority in whatever legislation replaces or reforms the ACA.

One way the federal government attempts to keep health costs contained is through enhanced fraud detection programs to assure that claims for care represent actual and needed care. These efforts rely upon audit processes within the Medicare and Medicaid programs to assure that care that is paid for is necessary and that the care was actually provided.

The antifraud tools used within federal programs have been picked up by state insurance regulators. The result is that in recent years state agencies have required health care plans of all types to increase efforts to ferret out fraud — and this has included increased auditing conducted by dental benefit plans.

These enhanced audit policies have increasingly been used in dental plans’ utilization management programs. Most plans engage in postpayment utilization reviews by requesting a number of patient records to compare the care provided with the claims submitted. Patterns in the claims history that are outside the norm may trigger these types of reviews. For example, a general practice dentist who performs scaling and root planing procedures more frequently than other general practice offices could send up a red flag that SRPs are being overutilized and are unnecessary. Of course, there may be a good reason why a practice performs more SRPs than the average general practice office. Perhaps the practice sees more older adults than the average practice, resulting in a higher proportion of patients needing periodontal care — and if this is the case, it would be revealed in an audit of patient records.

When a dentist contracts with a dental plan, the dentist authorizes the plan to conduct audits of the practice’s patient records by virtue of being under contract with the plan. In other words, a plan’s authority to conduct an audit of the practice is embodied in the provisions of the contract the dentist has with the plan. The dentist has agreed to be audited by signing his or her provider agreement with the plan.

This method of authorizing audits has led CDA to contest some plans’ audit requests of dentists.

Two plans in particular, United Concordia and Guardian, have over the past few months made requests for audits of patient records of dentists who are not contracted with either plan. The plans maintain that they have a fiduciary responsibility to their subscribing group to assure that claims were paid correctly, and this is done through audits. But CDA maintains and has communicated to both plans that while they may want to conduct audits of payments to noncontracted providers, the authority to conduct such audits resides in a plan’s contract with the provider.

If there is no contract, there is no authority to conduct these audits.

In each case, these plans have directed CDA’s objections to their own legal departments. After such a review, both plans have acknowledged that they have no expressed authority to force a noncontracted dentist to comply with an audit request. However, they also hold the opinion that if they request an audit of a noncontracted dentist’s patient records and the dentist agrees to be audited, an audit will go forward. CDA cannot object to this approach taken with noncontracted providers.

For this reason, dentists should be aware that while a plan with which they do not have a contract cannot require participation in an audit, dentists who voluntarily submit to an audit are likely obligated to open their patients’ records to review by the plan.

As the plans face more pressure from their consumers and regulators to have a robust utilization management and or fraud detection program in place, CDA has noticed many of the plans doing more prepayment screenings. Delta Dental has adopted another form of review. In addition to postpayment utilization reviews, Delta is asking more frequently for additional documentation from dentists prior to paying on certain claims. These prepayment reviews are not audits, but appear to represent a shift in Delta’s claim review process. The downside is that these request are resulting in additional work by dental offices after claims have been submitted. The upside is that they will likely result in fewer errors made when paying claims, and will likely result in fewer postpayment utilization management audits and refund requests.

For more information on dental plans’ audit programs, read the CDA Practice Support resource “Understanding Utilization Review and Audits by Benefits Plans.”

Related Items

The Centers for Medicare and Medicaid Services has again extended the deadline for dentists to either enroll as a Medicare Part D "ordering/referring provider" or opt out of the Medicare program entirely. The previous deadline was Feb. 1, 2017, but it has now been extended to Jan. 1, 2019.

Recently, Practice Support has received questions about whether the dental plans that dentists are contracted with can dictate fees for treatment on procedures that the plans don’t cover. The answer can be found in CDA-sponsored legislation that became effective in 2011.