PPO Increases Pressure on

Dental Providers to Lower Fee Schedule


By Shelley DeGroff, Founder of PPO Advisors

If you’re feeling squeezed by your PPOs – you’re not imagining it and you’re not alone. Even as dental providers are struggling with the post-COVID labor shortage and high inflation rate, insurance companies are taking legally and ethically questionable actions in a bid to pressure providers into accepting lower fee schedules. I’ve seen a lot in my 20 years of negotiating with insurance companies, but what some carriers are doing now surprises even me. To give you an idea, I’ll share the experience of one of our clients.

Insurance Company Retaliates – Leaves Patients Out of Network

This client, who we’ll call ABC Dental, consists of an owner-provider, whose had a direct contract with Cigna for the last five years, and five associates who have been participating with Cigna through a lease agreement – all very standard. The owner of ABC Dental has stopped seeing patients as a prelude to transitioning out of his practice, so he decided to drop his Cigna contract. In retaliation and without any warning, Cigna pulled all of his associates’ lease share agreements and terminated them. All of their patients who had Cigna insurance, were suddenly out-of-network.

Cigna’s actions are wrong on many levels, the most obvious being the blatant disregard it shows for their own clients – people who pay them for dental insurance. ABC Dental does close to $4M in production, and a substantial portion of their treatment planning is done with Cigna. Many Cigna-insured patients were in the middle of treatments at the time Cigna terminated the agreement.

Had the situation been reversed and ABC Dental had wanted to end their lease agreement with Cigna, they would have been required to provide 90 days written notice in order to give patients time to complete their treatment. It’s considered standard practice for insurers to do the same.

Forcing Providers into Direct Contracts with Lower Fee Schedules

The reason behind Cigna’s hardball tactics is to force all the associates at ABC Dental into direct contracts with a lower fee schedule. Through the shared lease agreement, the practice was already taking a 25%-30% write off, but to Cigna, this was not enough. Cigna let ABC Dental know they will only reconsider the termination with a lower fee schedule.

These actions are consistent with a broader strategy we’ve seen with Cigna, which is to force all providers into direct contracts and force them to accept write offs at around 40%. For many practices, writing off that much is simply not sustainable.

Even though Cigna dropped ABC Dental months ago, the insurer continues to list the practice on their website as one of their in-network providers. I don’t think it’s a mistake; rather, it’s part of a strategy to inflate provider numbers to make Cigna look good to employers shopping for insurance. The fact remains that it’s false advertising.

Providers Need to Make Their Voices Heard and Bring Attention to the Problem

Cigna is not the only carrier taking more aggressive positions with dental providers, and left unchallenged, the problem will only get worse. Given the size and resources of insurers, it’s easy for them to pick off practices one at a time. The only way we can change the situation is if providers make some noise and work together to bring attention to what’s happening.

If you’re getting pressured by insurers, here are some things you can do to make your voice heard:

If you have questions about your PPO contract or are under pressure to lower your fee schedule, contact our team at PPO Advisors.  We understand insurers’ strategies and tactics and will be strong advocates in your corner to help you get a fair deal.

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