Participating with dental insurance plans can bring patients through your doors—but what is it really costing you?

The answer lies in the numbers, and one of the clearest indicators is the write-off: the difference between your usual and customary fee (UCR) and the contracted fee you're allowed to charge. These write-offs aren’t just “part of doing business”—they can be a silent profit killer.

What Is a Write-Off in Dental Insurance?

A write-off is the portion of your fee you’re contractually obligated to “forgive” when you're in-network with an insurance company. If your crown fee is $1,400 but your contracted fee is $900, that $500 difference is a write-off—not collectible from the patient or insurance.

That means you're voluntarily reducing your revenue by over 35% for that procedure.

National Averages on PPO Write-Offs

Studies from various dental industry sources provide sobering data:

• ADA’s 2023 Dental Fees Survey reports that write-offs for participating PPO providers average 30% to 40% across the board.

• Practice Booster (Dr. Charles Blair) notes that some dentists are writing off up to 50% of their gross production depending on how many PPOs they accept.

• Levin Group has long cited that “heavy PPO participation can reduce practice profitability by 20% or more,” especially when combined with rising overhead.

Example:
If your practice produces $1,000,000 in services annually, and you average a 35% write-off across multiple plans, you're losing $350,000—not due to overhead or inefficiency, but purely from plan adjustments.

Why This Matters More Than Ever

1. Overhead Is Rising

Staff wages, supply costs, and rent continue to climb. If your collections are suppressed by PPO fee schedules, your profit margins shrink, even if production stays strong.

2. Insurance Complexity Has Increased

Even with pre-authorizations, insurers are increasingly denying claims or bundling procedures, adding administrative costs and delay.

3. Pre-Insurance Profitability Metrics Tell the Real Story

Many consultants now advise dentists to track two critical KPIs:

• Adjusted Production: Total billed minus write-offs

• Collection Percentage on Adjusted Production: Should be 98% or higher for healthy cash flow

If your write-offs are swallowing more than 30–35% of your gross production, you might be working twice as hard for half the pay.

Is It Time to Reevaluate Your PPO Strategy?

Here are a few signs you may be over-participating:

• Your write-offs exceed 35% of production

• You're booked weeks out but profitability is flat

• Your hygienists are fully scheduled, but you're still struggling with cash flow

• You're considering extended hours just to stay profitable

Options to Reclaim Profitability

1. Analyze Each Plan Individually: Not all PPOs are equally damaging. Evaluate reimbursement rates vs. patient volume.

2. Consider Strategic PPO Dropping: Start with plans that:

   • Pay the lowest

   • Require the most admin work

   • Have minimal patient loyalty

3. Increase Your UCR Fees: This widens the gap between UCR and PPO fees, but it can improve out-of-network reimbursements and future negotiation leverage.

4. Offer an In-House Membership Plan: Many practices successfully replace PPO patients with fee-for-service or membership-plan patients over time.

Solution: Regain Control by Negotiating Fees

The good news? You're not powerless. Dentists across the country are successfully negotiating higher PPO reimbursements, improving their profitability without dropping plans outright.

Start by:

• Reviewing your current fee schedules

• Identifying your lowest-paying plans

• Requesting a fee increase or plan re-tiering

This process can be time-consuming—but you don’t have to do it alone.

We recommend checking out www.veritasdentalresources.com, a premier service that helps dentists professionally negotiate PPO fees, analyze plan performance, and develop a custom insurance strategy.

Practices that work with Veritas often see thousands in recovered revenue without adding more hours or procedures—just smarter reimbursement.

Final Thought: Know Your Worth

Being insurance-friendly doesn’t mean being revenue-weak. Understanding and monitoring write-offs is crucial to financial health. The reality is that participating with insurance may bring volume—but that volume is only valuable if it’s profitable.

If your write-offs are consistently high, you may be working harder than necessary for significantly less return—and that’s worth a closer look.

References & Resources:

• ADA Dental Fees Survey (2023) – American Dental Association

• Practice Booster / Dr. Charles Blair – Coding with Confidence, Dental Economics

• Levin Group Reports – Practice management benchmarks

• Dental Intel – KPI tracking for profitability

Benjamin Tuinei

Founder - Veritas Dental Resources, LLC
Phone: 888-808-4513

Services:
PPO Fee Negotiators | PPO Fee Negotiating | Insurance Fee Negotiating
Insurance Credentialing | Insurance Verifications

Websites:
www.VeritasDentalResources.com | www.VerusDental.com