If you've had anything to do with healthcare, even from a distance, you've probably heard about PPO fee negotiations. What used to be a behind-the-scenes tactic is now something almost every practice is at least aware of. In the last ten years, fee negotiations have grown from something few talked about to something practices are starting to take seriously as a smart strategy.
Today, many dental and healthcare offices are attempting these negotiations on their own, while others bring in professional help. Some are seeing great results. Others? Not so much. So, why the inconsistency? It could be location, competition, or even the flow of new patients, but often, it's just a lack of clarity on what affects PPO deals.
Let’s rewind a little. PPO stands for Preferred Provider Organization — a type of insurance where providers agree to lower fees in exchange for patient volume. For patients, PPOs mean they can get discounted care within a network but still have some flexibility to go out-of-network if needed. For practices, it's about weighing reduced reimbursements against the promise of more patients.
How PPO Plans Took Over
A glance at insurance trends tells us a lot. Back in the late ‘80s and early ‘90s, PPOs weren’t even in the picture. Fast-forward to today, and PPOs now cover almost half the American workforce. That explosive growth has pulled more providers into the PPO web, whether they’re ready or not.
Why PPO Negotiations Matter Now More Than Ever
With inflation making everything more expensive from salaries to supplies, practices can’t afford to stand still. Slashing services or letting go of staff just to stay afloat isn’t a long-term solution. Fee negotiations with PPOs offer a smarter alternative. And yet, many practices still overlook it.
Too many practices raise their fees to keep up with costs, but never think to question the fees they’re being reimbursed. That’s a missed opportunity. In fact, some dental practices are losing up to 45% of their potential earnings just because of poor PPO fee schedules. On the flip side, practices that approach negotiations smartly can boost revenue by 7%, sometimes even up to 30%.
Step One: Know When (and How) to Raise Your UCR
Every year, your usual customary rates (UCR) need a checkup. A lot of practices don’t bother updating their office fees in their management software. And we often see codes where the UCR is way below what insurance is willing to pay other providers.
The trick is aligning your fees based on your patient mix. If most of your patients are PPO, your UCRs should be high enough to leave room for those inevitable discounts. But if you're mostly seeing cash patients, go easy, too high, and you may scare folks off. This is where in-house discounts or membership plans can help. Offering, say, 20% off for uninsured patients or a flat annual fee for basic care could make your services more accessible without cutting into profits.
Step Two: Understand Your Fee Schedule’s True Impact
Here’s the thing: insurance companies build their fee schedules based on the UCRs submitted in claims. If you’re submitting low fees, you’re giving them a reason to keep reimbursements low, not just for you, but for everyone in your area. That’s why it’s crucial to make sure your UCRs reflect the real cost of running your practice.
And don’t get confused between write-offs and adjustments. An adjustment is just the difference between your fee and the PPO rate, not lost revenue. But submitting low UCRs? That’s a real hit to your bottom line.
Step Three: Take a Hard Look at PPO Leasing and Networking
Understanding how you’re participating in these networks is key. Are you in a direct contract with the PPO? Or is your practice being leased through another network? Terms like "leasing" and "networking" often get thrown around interchangeably, but the difference is big — and it matters.
There are three ways providers typically participate:
While some leased networks can bring higher reimbursements, they also bring a lot of confusion. Your team might struggle to keep up with all the different fee schedules. Worse, you might think you’re in-network when you’re not, or vice versa.
That’s why it pays to work with someone who knows how to sort all this out. PPO negotiations aren’t one-size-fits-all. Your location, your specialty, and even your state laws play a role in what’s possible.
At the end of the day, PPO negotiations are about reclaiming control over your practice’s financial health. Whether you're raising UCRs, rethinking your contracts, or making sense of complicated networks, small changes can bring big results.
Download the white paper now and learn how to better optimize PPO reimbursements.
Need help optimizing your PPO reimbursements?
Get in touch with us at Capline Services. Let’s work together to improve your bottom line without compromising your care.
Call us at (888) 444-6041 or email thinkgrowth@caplineservices.com to learn more.
