Why Your UCRs Matter More Than You Think in PPO Negotiations
As the founder of PPO Advisors, I’ve worked with countless dental practices across the country. One of the most common — and costly — mistakes I see is practices setting their Usual, Customary, and Reasonable (UCR) fees too low. What many providers don’t realize is that UCRs don’t just influence what patients see on their statements — they directly impact your ability to negotiate stronger PPO reimbursements and, in some cases, affect the entire dental community in your zip code.
What the ADA Recommends for UCRs
The American Dental Association (ADA) has long recommended that providers set their UCR fees within the 70th to 80th percentile of their geographic area. In plain terms, this means your fees should not be at the bottom of the spectrum — they should be competitive and reflective of the value of your services.
If you’re setting your fees based on “what feels reasonable” or worse, what you’ve been charging for years without adjustment, you’re leaving significant money on the table. Insurers benchmark your fees against regional data. If your UCRs are too low, it sends the message that you’re comfortable with lower reimbursements — and that’s exactly what you’ll get.
How Often Should You Update Your UCRs?
UCRs are not a “set it and forget it” number. At minimum, you should be reviewing and increasing your UCRs annually. Inflation, increased supply costs, higher staffing expenses, and advancements in dental technology all warrant regular adjustments.
Think about it this way: if your rent, lab fees, or wages go up every year, shouldn’t your practice fees reflect those same increases?
The Hidden Cost of Low UCRs
When you keep your UCRs below average, there are several negative consequences:
– Weak Negotiation Power: Insurance companies use your current fee schedule as a baseline. If your UCRs are set far below the 70th–80th percentile, you’ll struggle to secure higher PPO reimbursements because the insurer can argue your “standard fee” doesn’t support it.
– Zip Code Impact: Insurers don’t just look at your practice in isolation. They evaluate fee data across entire regions. If one or more providers in your zip code maintain artificially low fees, it drags down the average — making it harder for every dentist in your area to negotiate better rates.
– Lost Revenue Opportunities: Even out-of-network and cash-paying patients are affected. Patients who compare your fees to others may undervalue your services simply because your pricing doesn’t reflect your expertise and quality of care.
Raising the Bar for Your Practice and Your Community
The bottom line is this: low UCRs hurt everyone. They hurt your practice by lowering reimbursements, they hurt your colleagues in the community by suppressing negotiation leverage, and ultimately they hurt patients by stifling practices’ ability to reinvest in technology and care.
If you want to position your practice for long-term success, commit to:
– Reviewing UCRs annually
– Aligning with ADA’s 70th–80th percentile guidelines
– Using data to negotiate from a place of strength, not weakness
At PPO Advisors, we’ve seen firsthand how strategic fee setting can completely shift PPO negotiations in your favor.. Raising your UCRs to the right level is one of the most powerful steps you can take toward healthier reimbursements and stronger practice growth.
👉 Final Thought: Don’t underestimate the ripple effect of your UCR decisions. What you do in your practice doesn’t just impact your bottom line — it can influence the entire dental community in your region.
By Shelley DeGroff, Founder of PPO Advisors