DCS Dictionary: Dental Patient Billing Terms

Navigating the complex world of dental patient billing can be a daunting task for dental teams. Often, the confusion between similar billing terms leads to costly mistakes, impacting the efficiency and profitability of dental practices.

But dental patient billing mistakes also affect the core of your business. You guessed it: Patients. 

At DCS, we’re fluent in the language of patient billing. As full-service revenue cycle management (RCM) providers, we work with dental businesses of all types, shapes, and sizes to ensure they have a smooth and efficient patient billing process. 

You never want your patients to feel surprised or misled when it comes to their dental treatment costs, that’s why our services automate your patient billing process — creating convenience and eliminating a lot of the confusion around patient billing terms.

But it’s still important to understand these terms, so we’ve created this dictionary for you. Let’s get into it.

1. Patient accounts receivable (AR)

Patient accounts receivable (AR) refers to the outstanding balances owed by patients for dental services you’ve provided.

DCS Operations Coordinator, Harry Levy, explains—

“If you are collecting what you’ve estimated the patient portion to be at the time of service, the only patient AR you should have is from insurance claims that paid less than estimated.”

In other words, an ideal patient AR report stays low due to accurate estimates of what payers and patients will owe. Patient AR is often confused with the insurance aging report — which is also abbreviated as AR. While the insurance AR logs overdue payments, Patient AR helps you keep track of which patients carry an outstanding balance and how much they owe.

2. Merchant fees

Merchant fees are the costs incurred by a dental practice when processing patient payments made with credit or debit cards, whether in the office or online.

These fees are unavoidable in this age of cashless payment. The percentage charged per transaction may vary depending on where the payment was made (online or in person), and depending on the card used (Visa, Mastercard, American Express or Discover). You may also pay monthly fees.

Merchant fees are an expense you should expect to pay and take into consideration when accepting debit and credit card payments.

3. Digital and automated outreaches

Digital and automated outreach refers to the use of digital tools and automation when communicating with patients for billing and appointment reminders.

These cyber-helpers streamline the billing process, making patient billing a hands-free process for your team while enhancing patient engagement and encouraging timely payments.

For optimal convenience for your patients and your team, the best automated patient billing systems will:

• Calculate the patient’s balance automatically after the insurance payment is posted
• Bill the patient automatically and electronically
• Accept and process their online payments, and
• Make a direct deposit to your bank

These automated tools will also send payment reminders at programmed intervals to patients with outstanding balances, which we will get to later in this article…

Related: Dental office automation: What it will do for you and why your team is still crucial

4. Days past due vs days since visit

Days past due indicates the time elapsed since a payment became overdue, while days since visit refers to the time since the patient's most recent appointment.

Understanding the difference in these terms is crucial for timely billing with insurance companies and communicating with patients. Distinguish between these terms to schedule follow-up calls and reminders, and also manage your patient AR effectively. 

If your patient billing process is automated, those two dates are already within the system, which automatically manages how patient bills are prioritized. And if a patient ever has a problem with their bill, you’ll want to refer to both dates — how long it has been since their visit, and also how many days their payment is past due. 

Related: How to handle a dental patient who has a problem with their bill

5. Reminder cadence

Reminder cadence is the frequency and timing of billing reminders sent to patients.

A consistent reminder cadence is key to ensuring timely patient payments and maintaining a healthy cash flow.

If you automate your patient billing system, the payment reminders sent to patients are backed by accurate insurance payment posting and claim payment notations in your patient management system (PMS) software.

This is one of many benefits to automated billing — your team doesn’t have to worry about accuracy, following up constantly and consistently, or how often the patient is receiving a payment reminder.

Related: 3 reasons to automate your patient billing services ASAP

6. Collection agency

A collection agency is a third-party organization hired to pursue and collect overdue payments from patients.

This is usually a last resort when collecting from patients, as you do not want to damage the patient relationship — or surrender up to 50% of the payment to the collection agency.

But if you are working with a billing services provider, and neither your provider contact nor your team can get payment from a patient, turning to a collection agency might be necessary.

You will collect less than what you’re owed, but it is a step that can be worth taking to resolve long-overdue accounts that impact your practice’s patient AR — it’s better to collect something than nothing.

Some people confuse DCS as a collection agency, but we only directly communicate with your team and payers; we never interact with your patients.

7. Financing options

Financing options are arrangements that allow patients to pay their bills over time, making dental care more affordable. Offering financing options — also known as payment plans — can improve patient satisfaction and increase the likelihood of collecting full payment.

Your financing options should be explained during your patient’s treatment presentation when you also explain what kind of coverage they can expect from their insurance policy. 

With an optimized automated patient billing system, financing options with periodic payments and reminders will be a welcome convenience for patients who choose to split up their bill over time.

Related: Dental office automation: What it will do for you and why your team is still crucial

Take advantage of the DCS Knowledge Network to ensure patient billing accuracy and compliance, and also boosted profits

To recap, we covered the definitions of: 

1. Patient accounts receivable (AR)
2. Merchant fees
3. Digital and automated outreaches
4. Days past due vs days since visit
5. Reminder cadence
6. Collection agency
7. Financing options 

Understanding these key patient billing terms is essential for the accuracy, compliance, and profitability of your dental practice. This knowledge will also help you maintain a transparent relationship with your patients. 

We mentioned automated patient billing systems quite a bit in this article because we’ve found that they not only relieve your team of the paperwork and time required to fulfill patient billing, they also give your patients a seamless billing process with conveniences that result in you receiving the payments you’ve earned. 

DCS offers automated patient billing services that collect with confidence, so your team can focus on creating unique relationships with each patient. Collect more and worry less: Book a call with DCS.