Illegal dental billing practices have become increasingly prevalent in the modern-day age. The effects of such practices rarely remain contained to just insurance companies that get defrauded. Instead, the adverse spillover effects of practices such as dental insurance fraud expand to the patients, dental staff, the dentists, and dental billing companies as well.
How do Illegal Dental Billing Practices Work?
The various types of dental fraud range from the misrepresentation of the practitioner to the hiding of the exact cause of the problem that requires treatment.
Ways of doing this intentionally can include misreporting procedures for the added insurance benefit, that is, reporting one procedure with another’s name that is covered by the insurance to gain financial benefit. Another way misreporting would work is by exaggerating the procedure that has actually been performed. This results in dentists overcharging patients making use of their knowledge of the issue, and unnecessarily charging extra for a simple treatment procedure, a classic example of the adverse selection problem and asymmetric information.
The most common ways of committing dental insurance fraud include charging customers extra, as explained in the earlier example, exaggeration of the procedure itself (a practice known as ‘upcoding’), an underreporting of the claims a particular patient is making on the same procedure, overusing codes in claim forms, such as billing the consultation session, required medicines, essential tools that are utilized and the procedure itself, when the procedure already included these bills (a practice known as ‘unbundling’).
The customer can also conduct such practices through misrepresentation of the patient ID to gain financial benefits, an attempt to change the dates of when the procedure was undertaken to make it possible for them to claim it under insurance, or them asking to misreport the procedure conducted to make it possible for them to claim the insurance on it.
Types of Illegal Dental Practices
The four kinds of illegal dentistry billing methods to be mindful of are as follows:
1. Upcoding: When a dentist bills for a more expensive treatment than was actually done. For example, if a patient only got a routine cleaning but the dentist bills for a more complex and expensive treatment, such as a root canal, this is called upcoding. Upcoding can also happen when a provider bills for a greater degree of service than was actually provided, such as charging for an expert appointment when only a general session was provided.
Upcoding is illegal because it can cause people to pay more for treatments they did not obtain. It also gives dental providers who participate in this practise an unfair edge because they can receive larger payments from insurance companies.
2. Unbundling: When a provider bills individually for specific services that should be billed together as part of a complete care plan, this is referred to as unbundling. For example, if a patient gets a tooth implant, the practitioner should charge for the complete process, including x-rays, anaesthesia, and follow-up care. If the provider invoices individually for each of these services, this is referred to as unbundling.
Unbundling is illegal because it can result in people spending more for their dental treatment than they should. It also makes it difficult for insurance companies to correctly estimate the cost of a treatment because separate billing makes it look more costly than it is.
3. Service misrepresentation: This happens when a supplier bills for a service that was not actually provided. For example, if a patient gets a filling but the practitioner invoices for a crown, this is deemed service misrepresentation. Service misrepresentation can also happen when a provider bills for a more costly substance or product than was actually used.
Misrepresenting services is illegal because it can result in patients spending more for their dental treatment than they should. It also gives dental providers who participate in this practise an unfair edge because they can receive larger payments from insurance companies.
4. Phantom billing: This is when a supplier invoices for services that were never provided. For example, phantom invoicing occurs when a practitioner invoices for a tooth extraction but the customer never has the teeth removed. Phantom billing can also arise when a practitioner invoices for medically unnecessary services.
Phantom billing is illegal because it is a form of fraud. It can result in patients paying for services they did not receive, and it can also create unnecessary medical risks if patients receive treatments they did not need.
What is the Effect of Illegal Dental Billing Practices?
The practitioner might face severe penalties and have their licenses revoked even if they are not completely aware of the fraud they are committing. Errors in filing insurance claim forms, intentional or unintentional, would result in serious legal action against the person who commits it if it is reported.
The effects of dental billing fraud also result in overcharging patients. Victims of such fraud are a common sight, with many being subject to exploitation due to their limited knowledge of what procedure has been conducted, and in instances, these victims being exposed to serious health threats due to the performing of unnecessary and often dangerous practices on them for the financial motive.
According to estimates of the NHCAA, the loss due to fraud in the health sector exceeds an annual $300 Billion. With a growing dental industry, this would mean that a considerable part of this loss would be occurring due to illegal dental billing practices.
Why do Illegal Dental Billing Practices Exist?
Having such significant problems attached to them, one begs the question of why these practices exist in the first place. The motives behind dental billing fraud can be summarized to:
1) Accidental
For instance, the wrong code for dental practice has been entered by the staff at a practitioner’s clinic, or the incorrect patient ID has been entered. Such an approach is often not deliberate and does not benefit the person who accidentally commits it. However, the negative implications still exist. Proper training mechanisms should be put into place to minimize the accidental misrepresentation of data.
2) Financial
The most obvious cause of defrauding in any instance is the financial motive. Through the misrepresentation of the practice or the patient, the defrauders aim to earn more money when less is owed to them by the insurance companies. It should be understood that the negative implications of fraud to the dental ecosystem and the individual effects of committing a financial felony far outweigh a few extra monetary units.
3) Benefiting the Customer
In order to increase customer loyalty and overall experience or to break the social stigma of dental health being expensive, the dental health practitioners may misrepresent the procedures to aid the customer in gaining financial benefit. In this act, however, both parties commit fraud and are subject to the negative effects of it. A better practice would be to implement more efficient strategies and practices to cut down costs in clinics and pass this benefit to the customer or have better customer care to establish loyalty.
How to Stay Safe from Dental Billing Fraud?
Practices can be implemented to tackle illegal dental billing practices and safeguard oneself from adversities. From the dentist’s perspective, helpful tips include:
- Always asking for the complete medical history of the patient.
- Properly verify all customer records and IDs, even for returning patients.
- Get educated and educate your staff about dental billing fraud and remain aware of the consequences of carelessness.
- Seek legal help whenever you suspect any particular patient.
From a patient’s point of view, practices to protect themselves from fraud can include:
- Be aware of the problem and do your own research.
- Always go for a second opinion when one consultant suggests a high-cost or extensive surgery or treatment.
- Read up about a dentist before consulting them to make sure they have a good reputation and credible practices.
- Be wary of appealing offers such as free treatment or teeth whitening; these offers may lure one into getting defrauded.
Please read our dental billing guide which comprehensively covers dental billing.
Conclusion
Practices such as those suggested may aid one in staying safe, but one can never be too careful. The harms of dental billing fraud far outweigh the temporary benefits the defrauder enjoys and often affect the whole ecosystem. Having an understanding of the adversities of illegal dental billing practices begs the question of what can be done to make sure one is safeguarded. Dental billing service providers such as Zap Dental make sure to protect their users from these illegal dental billing practices through services such as Insurance Eligibility Verification. Learn more by contacting us today to save yourself from dental billing fraud!
