Posting payments for patients that have multiple insurance plans can be complicated. There are really only two ways to effectively post when dual insurance comes into play. The most ideal method of the two (explained below) saves an office time in the long run and ensures providers are always paid correctly off accurate collections.
Before we get into the nuts and bolts of posting for dual insurance, let’s talk about how the relationship works between primary and secondary. The primary insurance plan, by law, shall pay or provide benefits as if the secondary plan did not exist. Each insurance plan is different, but with most plans the primary insurance plan covers the majority of the charges, and the secondary plan should cover the balance. This is definitely not the case with every insurance plan, as some will have a non-duplication of benefits clause, which means that if the primary plan pays the same or a greater benefit than the secondary plan allows, no benefits will be paid by the secondary plan. That is why it is important to always do insurance verification before the patient is seen!
Insurance verification will not only determine if there is a non-duplication of benefits clause, but it will also explain which of the two insurance plans has the lowest contracted fees.
Here’s why knowing if primary or secondary has the lowest fees is important…
Once the order of benefits is determined, the claim can be confidently submitted to the patient’s primary insurance. Once the payment is received we post that payment before sending the secondary claim. This is when it gets tricky! Do we take the adjustment from the primary EOB, or do we take the adjustment after secondary pays?
By law (in most states and most PPO plans), the dental office has to take the adjustment from the insurance plan with the lowest contracted fees. Offices may be wondering, “how do I know which plan will have lower fees?” From your insurance verification! But now you’re saying, “Oops, we forgot to do that this time, what do we do now?”
Take the adjustment after secondary pays! To do this properly, you need to record the adjustment amount from the primary EOB. The easiest way would be to leave a quick note in the claim. Once the secondary payment is received, then the office can determine which plan has the lowest contracted fee, without having to delete or change anything. And then post the payment accordingly.
Let’s look at the flip side to see why this saves you so much time in the future. Say you take the adjustment from the primary EOB. When the secondary payment is received, yes it’s true that you can determine which plan has the lower contracted fees, but the adjustment was already taken for the primary payment, so if the secondary plan has lower contracted fees, then the office will need to go back and correctly change the adjustment on the primary claim. If your office pays providers by collections, it can completely mess up the allocation of payments when that primary adjustment is deleted.
There is a chance that secondary will come back with higher contracted fees, and there’s no need for adjusting the primary claim, but why risk it? Wait until BOTH insurances have paid in order to make the adjustment.
Properly knowing how to handle dual insurance will save you time and hardship in the future. It all starts with insurance verification! Knowing which insurance company will have the lower contracted fees ahead of the patient being seen will allow you to know which adjustment to take ahead of time.