Biggest Dilemmas with Insurance Checks EOB Standardization

By: Dr. Dorothy Kassab, Owner and Founder of Dental Claims Cleanup

What is most challenging about dental billing and what would be the solution to benefit the provider and the patients? The answer is: Standardization of the dental EOB (explanation of benefits) that accompanies the insurance checks. Reading the dental EOB and entering into the dental software is the most difficult task to teach in dental billing. Think about this, we are required to submit claims on a standardized ADA claim form, use standardized ADA codes, and all information has to be exact or we don't get paid. Now, what we get from the insurance, with the insurance check, is like some kind top secret.

I am not sure why this has not happened yet. But, I have a good hunch that it is to the insurance industry's benefit to have the EOB be as confusing as possible, misleading, and deceiving. The more complicated it is to read, the higher the chance of mistakes in accounting for the claim. This in turn has positive impact on the insurance and negative impact on the providers and the patients.

The positive impact on the insurance is several fold. The downgrades, denials, write-offs and other debits can be easily missed or misunderstood, as well as, efforts might be forfeited to fight the insurance on coverage, resulting in acceptance of the lower insurance payment and the insurance benefiting from lower payout.

The negative impact on the providers and patients in immense. Since there is no standards for the EOBs, different insurances have various verbiage for the above components and may be missing some of the components necessary to correctly account for the claim. This is confusing and throws our dental billers off. The credit or debit adjustments have to be figured out by the dental billers correctly. Since the verbiage is inconsistent, it causes errors in adjustments and other components of the EOB entry into dental software. Incorrect accounting of the settled claim, affects the patient's balance. As a result, there could be too much written off and not enough collected from the patient, or not enough written off and too much collected from a now angry patient. Also, when it is difficult to read the EOB, it takes the dental billers longer to enter the check into the software making this task time consuming. In a dual insurance situations, the confusion results in back and forth communications between the carriers and extension of time the providers get paid on claims. Very often, it results in running into a timely filing denial of coverage. In addition, errors in EOB entry effect the insurance fee schedule and/or write off history causing future estimations of treatment plans to be off resulting in underestimations and lack of patient collections.

In the end, any errors in the accounting of the insurance payments and accuracy of the patient's ledger falls on the providers, and when audited by the office of professional discipline, errors are considered malpractice. Wrong write offs, uncollected patient balances, etc can all result from misinterpretations of the confusing EOBs and yet we are held to standards. Why can't the insurance companies be held to standards of reporting the EOB. It certainly would help the dental community and the patients.

Lack of Standardization of the EFTs causes Additional Issues:

EFTs are deposited as lump sum on an unknown date. The dental biller, then has to go to the website and obtain the EFT EOBs to account for the paid claim in the dental software. Often it is difficult to figure out which EFT to look for since there is limited information in the bank deposit statement. In addition, the issue is the timing of the deposit and the entry into dental software. For those of us who want to balance our deposits against the bank account, this is virtually impossible. This is because the EFT deposit is usually on a different day than the day the biller enter. So the amount deposited into the bank account will not match the daily deposit in the dental software. Not being able to check the dental software deposit against what deposited into the bank account is a serious exposure to potential theft, errors by the insurance carrier that are not caught, and errors in EOB entry and patient accounts that go unnoticed.

What are the important details that are needed to successfully account for the EOB in the dental software?

• Provider's UCR: the provider's fee for the procedure
• Insurance Allowable fee: the contracted fee provider agreed to with the insurance
• Insurance Write off Adjustment: adjustment of the provider fee to the contracted allowable fee
• Insurance payment: actual amount settled by the insurance on the procedure
• Patient's Responsibility: patient's copay for the procedure
• Primary Insurance Coverage: the total fee paid by the insurance for this claim by the primary insurance
• Deductible, alternative benefit fee, and downgrades and other discounts: amounts that reduce the insurance payment for the procedure as charged by the provider or agreed upon in the contract
• Total of the check: the actual $ amount paid on the claim

Dental billers have to be able to interpret various EOBs, how the claim was paid, and if it was paid to the contractual standards. Then a determination needs to be made if an appeal is in order. But, this is not easy when the insurances have no standards with the EOBs they provide. The loss of time, the loss of revenue, and the amount of errors lack of Ebb standardization creates, one would think someone would set guidelines similar to what the providers have to adhere to. But like everything else, the insurance companies would never do anything to help the providers.