Finding the Right Balance Between Fee-for-Service and In-Network Dental Insurance Participation

Introduction

As a dentist, deciding whether to be a fee-for-service (FFS) practice, an in-network provider, or a mix of both is a critical business decision. While FFS offers higher reimbursements and more autonomy, in-network participation can attract a higher patient volume. The challenge is finding the right balance that maximizes profitability, maintains quality care, and ensures long-term growth.

This article will guide you through key considerations, pros and cons, and practical strategies to create the ideal balance for your practice.

Understanding the Differences

1. Fee-for-Service (FFS) Model

You set your own fees and patients pay out-of-pocket or get reimbursed by their insurance.
Higher profitability per patient since you're not restricted by PPO fee schedules.
More treatment flexibility—you’re not limited by insurance company policies.
Lower patient volume—patients may seek in-network options to reduce out-of-pocket costs.
Requires strong marketing & patient retention strategies to sustain revenue.

2. In-Network (PPO) Model

Access to a larger patient base since many patients prefer in-network providers.
Faster patient acquisition, as insurance companies list you as a preferred provider.
More predictable patient flow, helping to fill your schedule consistently.
Lower reimbursements—PPO fee schedules typically pay 30-50% less than UCR fees.
Higher administrative burden, including claim denials, pre-authorizations, and write-offs.

How to Find the Right Balance

Step 1: Analyze Your Current Patient Base

• What percentage of your patients use insurance vs. pay out-of-pocket?

• Are your in-network PPO contracts profitable or causing financial strain?

• Do you have a strong base of loyal FFS patients willing to pay for premium care?

Action Tip:
Run reports on your top insurance carriers and their reimbursement rates. Identify which PPO plans are beneficial and which are not worth the lower fees.

Step 2: Selective PPO Participation

Instead of going all in on PPOs or being 100% FFS, consider a hybrid model where you:
Accept only higher-paying PPOs that make financial sense.
Drop low-paying PPOs that significantly cut into your profit margins.
Consider umbrella networks that give you access to multiple PPOs under one contract.

Action Tip:
If you're already in multiple PPOs, consider negotiating better reimbursement rates or dropping the lowest-paying plans first.

Step 3: Offer an In-House Membership Plan

Many FFS dentists successfully compete with PPOs by offering a dental membership plan for patients without insurance.

Benefits:
Provides affordable care options while keeping full control over pricing.
Encourages loyalty & retention, leading to repeat visits.
Reduces insurance dependence, helping maintain profitability.

Example Membership Plan:

• $350/year for 2 cleanings, exams, X-rays + 15% off other treatments.

• Tailor plans for seniors, families, or high-ticket procedures (e.g., implants, cosmetic care).

Step 4: Adjust Fees for Profitability

If you maintain an FFS model, your fees should reflect the quality of care, expertise, and technology you offer.

Ensure your fees are competitive yet profitable compared to local UCRs.
Regularly update your fee schedule to keep up with inflation and market trends.
Implement tiered pricing for elective procedures (e.g., premium vs. standard crowns).

Action Tip:
Use fee benchmarking tools (e.g., Fair Health, ADA Survey, or PPO Analyzer) to ensure your FFS pricing aligns with the top percentile in your area.

Step 5: Improve Case Acceptance for FFS Patients

Higher FFS retention relies on effective patient communication and value perception.

Train staff to clearly explain insurance benefits—many patients don’t understand that out-of-network doesn’t always mean no coverage.
Use visual aids, digital scans, and mock-ups to highlight treatment benefits.
Offer flexible payment options (CareCredit, Sunbit, or in-house financing) to ease affordability concerns.

Action Tip:
Instead of saying, "We don't take your insurance," reframe it as:
"We work with all major insurance providers to help maximize your benefits, and many of our patients receive great coverage even when out-of-network!"

Step 6: Invest in Marketing to Attract High-Value Patients

FFS practices thrive with a strong branding & patient acquisition strategy.

Optimize Google My Business for local SEO rankings.
Run targeted social media ads for implants, Invisalign, or full-mouth rehabilitation.
Build a referral program rewarding existing patients for bringing in friends/family.

Action Tip:
Emphasize premium care, advanced technology, and personalized service in your marketing instead of competing on price alone.

Final Decision: Should You Be FFS, PPO, or Both?

The Best Approach:

• Stay FFS-dominant while selectively accepting PPOs that make financial sense.

• Offset insurance write-offs with an in-house membership plan

• Use strong marketing to attract loyal, high-value patients willing to pay for premium care.

Conclusion

Finding the right balance between FFS and in-network participation requires data analysis, strategic planning, and ongoing adjustments. The key is to maximize revenue per patient while maintaining a steady flow of new patients.

Action Plan:
Evaluate PPO contracts & drop unprofitable ones.
Implement an in-house membership plan.
Strengthen marketing & case acceptance strategies.
Review and adjust your fee schedule annually.

By carefully balancing PPO participation and FFS offerings, you can create a practice model that is both financially sustainable and attractive to patients.

Would you like help analyzing your PPO fee schedules or setting up a membership plan

Let me know!