Ultimate guide to avoid dental insurance billing fraud: Protect your practice [Free resources]

According to the Colorado Dental Association, between 20% to 60% of dentists will experience fraud at some point in their careers. Will you be one of them? Or will you take these key steps to protect your dental business?

Were you aware of how widespread this problem is? How about the likelihood that you’ll face problems with fraud at your dental or oral surgery practice? Perhaps you’ve already faced this issue and want to prevent it from happening again.

The chances are high that you or someone you know in the dental industry has dealt with fraudulent billing, whether intentional or accidental. Unfortunately, the consequences can be detrimental either way: unrecoverable funds, legal fees, your license suspended or revoked, the loss of your practice, and/or damaging your reputation as a reliable oral healthcare provider.

Fortunately, you can take several precautions to avoid dental insurance billing fraud and its painful consequences.

This is your ultimate guide to avoiding dental insurance billing fraud, including our expert’s practical advice and proven steps. We’ll deep dive into how insurance fraud occurs, and even hear from our Oral Surgery Business Unit Manager, Angela Moorman-Rakestraw, about what she witnesses when fraud impacts dental businesses.

As added bonuses, you have immediate access to 2 free fraud-focused resources. 

Key takeaways on how to avoid dental insurance billing fraud:

• Education is key—lack of dental insurance expertise is what gets dental and oral surgery teams in a tangle and endangers your practice
• Accidental fraud is the most common insurance billing fraud is accidental, but innocent mistakes still bring serious consequences
• Intentional fraud has surefire signs and red flags that you must be aware of and stay vigilant about

What is dental insurance fraud?

Dental insurance fraud occurs when false or misleading information is submitted to an insurer in an attempt to receive unauthorized benefits. 

In fact, there are quite a few honest oversights that lead to fraud.

Innocent mistakes that can be seen as fraud

It turns out that dental insurance fraud often comes from common mistakes made by dental teams with no intention to defraud insurance companies, including: 

• Incorrectly listing the treating dentist. Consider when an associate dentist provides treatment but is not credentialed (i.e., they’re not in-network with the insurance payer). When an out-of-network dentist treats a patient, they should be listed on the claim as the treating dentist—but an unaware biller may put the office’s in-network dentist on the claim form so the treatment will qualify for the in-network fee. This substitution is understandable, but it’s fraudulent.
  
  
• Not disclosing that treatment is due to an auto- or work-related accident. It’s essential that your team state the treatment was needed due to an accident, and what kind of accident it was, as that impacts the payer’s responsibility. If it happened on the job, it is covered by workers' compensation. If it happened in a car accident, it may be covered by auto insurance. A team member who lacks the knowledge or understanding of how to (or whether to) enter this critical information might submit a claim without it, and that is considered fraudulent.
  
  
• Lack of education and training on insurance claim guidelines. If your team is not aware of, or up to date with, each payer’s claim and coding requirements, they’re bound to make mistakes. Unfortunately, the insurance company won’t see lack of knowledge as an acceptable excuse. As they see it, a deceptive claim was filed — the owner-dentist must have known what was going on behind the scenes because it’s their office, and they accepted paymentfor the procedure.
  
  
• Downcoding and upcoding through incorrect codes. Downcoding occurs when a provider bills for a service that is less complex than the service actually provided to the patient. Upcoding is the opposite — a provider bills for a service that is more complex than the service actually provided. Both result in improper payment to the dentist, and both are considered fraudulent. 

Read more: 4 common dental insurance mistakes that can lead to fraud [Free Guide]

Examples: How fraud happens at a dental or oral surgery practice:

Those are common mistakes that lead to fraud, but there are other ways fraud happens at a dental or oral surgery practice, such as fully misrepresenting treatment on claims.

The DCS Oral Surgery Business Unit Manager, Angela Moorman-Rakestraw, shares her experience on how fraud happens at oral surgery practices: 

“The most typical kind of fraud that we see in oral surgery is when providers are contracted with a specific insurance company, and they do not bill claims out."

Another big challenge for dental teams that leads to fraud is miscoding — using an incorrect code on a claim. At both dental and oral surgery practices, insurance claims and medical claims require procedure codes that tell the insurance exactly which treatment was rendered, and this specifity makes it easy to choose the wrong one. Angela offers this example:

“We also see miscoding. This is usually from lack of education and knowledge about the appropriate billing guidelines for specific codes. So, for example, let’s say you’re billing an extraction with a bone graft and a resorbable membrane. 

There are specific codes for those bone grafts and those membranes to bill in conjunction with that extraction. If an implant is being placed, there are different codes for those same procedures to bill in conjunction with an implant. We see a lot of providers not using those codes correctly.”

Again, fraud is typically due to simple mistakes, but it’s just as harmful to your dental or oral surgery practice as if it were intentional. It can even impact how your patients view your dental practice. Angela adds: 

Now that you know the many ways fraud happens, let’s talk about how to detect it, and then steps you can take to prevent it.

How do I detect fraud — or worse, embezzlement — in my dental or oral surgery practice?

Fraud and embezzlement often happen because dental businesses unknowingly create opportunities through their internal workflows and processes.

Luckily, there are well-known red flags that indicate questionable activity, whether the fraud is intentional or accidental: 

• Unusual billing patterns and discrepancies
• Staff members overriding billing software alerts
• Patients questioning insurance claims they didn’t authorize
• High employee turnover in billing roles
• External audits uncovering suspicious patterns 

These activities occur unchecked when you, as a dental or oral surgery business owner, have little to no involvement in the day-to-day management of your practice’s billing. 

Read more: How can embezzlement be prevented at your dental business? 3 ways RCM will help protect you

What are the consequences of dental insurance fraud?

Off the bat, when you commit insurance fraud, even accidentally, you’re putting off reimbursement of the revenue your dental business needs — you’ll likely get an immediate claim denial when you miscode, incorrectly list the treating dentist, etc. Denials guarantee delays in payment.

If an insurance company notices continual fraud attempts, they will closely monitor your claims submissions. Angela shares from her experience with OMS (oral and maxillofacial surgery) insurance claims: 

“I've seen insurance companies red flagging providers and keeping them under review processes for up to 12 months or even 24 months, just because of following improper billing guidelines with those codes.”

No one wants to be under the scrutiny of dental insurance companies, but that’s merely frustrating. A tangible consequence is losing money in the form of fines. According to the ADA:

Other devastating consequences include losing your dental license, your practice, or ruining your reputation as a respectable oral healthcare provider. In addition to losing your livelihood, your team loses theirs, and your patients lose the dentist they’ve counted on — no one wins.

But you won’t face any of these consequences if your claim filings are accurate and compliant.

Can you avoid dental insurance fraud?

Yes, there are proactive steps you can take to prevent insurance fraud, both accidental and intentional. Angela shares this advice to dental and oral surgery business owners: 

That is the key to getting claims out clean, and getting them paid promptly. It lessens the chance of a denial from the insurance company.”

Knowledge is power when protecting your practice against mistakes that lead to fraud, and here are more tips…

5 ways to avoid dental insurance fraud in your practice

1. Implement clear billing protocols and staff training. Establish clear and complete billing protocols that cover all aspects of the dental billing process. This should include documentation for standardized coding practices, accurate narrative guidelines, and fee schedules, and also clear policies for handling insurance claims, patient payments, and refunds.
2. Invest in your team’s dental insurance billing knowledge. Whoever is responsible for your insurance claims should be proficient in dental insurance billing processes. Not just coding and submitting claims but also eligibility verification and filing appeals. This will ensure accurate and on-time claims, which reduces claim denials and payment delays.
3. Set up checks and balances with segregation of duties. Distribute responsibilities among your team members within the practice to prevent any single person from having complete control over any aspect of your billing process. This can also protect your practice from embezzlement. 
4. Create a fraud-reporting policy for employees. Your practice needs to feel safe for everyone, and part of that is everyone feeling comfortable coming to you with a workplace problem. Especially if the issue is fraud- or embezzlement-related, team members should know their identity will be protected when reporting something suspicious.
5. Outsource insurance billing to experts who’ll be your extra set of eyes on your practice. Not only does outsourcing insurance billing to specialists ensure you’ll avoid claim mistakes and have dedicated support, you’ll also have a remote third-party monitoring your records for signs of fraud and embezzlement. It’s like adding an extra layer of protection to your business. 

Read more: 5 benefits of revenue cycle management you'll see at your dental business

Get DCS’ Guide to Spotting Fraud at Your Dental Business

Now that you know more about fraud at your dental or oral surgery business, put our guide in your tool belt to help you spot fraud at your office.

DCS’ Guide to Spotting Fraud at Your Dental Business is a quick list that shares 5 ways to protect your practice against fraud, including what to look for and what action to take for each example. Fill out the form below to get the list in your inbox within minutes, and you’ll have a handy reference for spotting fraud at your dental or oral surgery office.

Protect your livelihood with DCS on your side

To recap: 

• Insurance fraud is often the result of innocent mistakes — but it can do lasting harm to your dental business.
• Your revenue and reputation depend on accurate and compliant insurance billing. There is every reason to bring in experts to support you.
• There are ways to protect your dental or oral surgery against fraud (and embezzlement!), you just need to implement a few personnel and policy changes.

Remember to download DCS’ Guide to Spotting Fraud at Your Dental Business to get a quick and easy list to protect your practice. And remember to take our free quiz to assess how vulnerable your dental business is to fraud and embezzlement. 

DCS service and software solutions are valuable tools for dental and oral surgery businesses hoping to collect more and worry less. From scheduling to insurance billing to patient collections, our team, and technology will support your entire revenue cycle, which includes helping safeguard your dental business against fraud and embezzlement.

Protect your livelihood: Book a free 30-minute consultation today.