May a dental practice forgive or not collect a co-payment from a patient?

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Waiving a patient’s financial dues could be a practice booster to attract new patients. Typically, this  means a violation of the contract when not collecting the co-payment and could be illegal based on  federal and state laws. However, the Question which often comes to mind is that : what if a neighboring dental office provides dental treatment without collecting deductible or  co-payment? What if the patient is a staff or  relative, friend of a dentist, or a low-income patient needing treatment. Unfortunately, writing-off co-payment can put the dentist on shaky ground and even put the license of the  practice in danger. If a dental  plan issues an invoice to the patient for the cost of rendered treatment, then the collection is a must.  

According to the ADA’s Code of Ethics, dentists who waive copayments from a patient and accept  payment by the insurer in full without revealing to the insurer that the patient’s portion of the cost is  not being collected are overbilling or committing insurance fraud. This is a breach of the contractual  agreement.  

Why do dental plans need co-payments? 

It is important to note here that the dental plan premium depends upon the cost of the treatments.  If the plan integrates some form of copay and the practitioner never intends to collect, then it changes the entire fee structure of the dental benefit plan. Initially, the dental plan will ask the  practitioner to collect co-payment from enrollee’s patients. However, deception and misrepresentation of  not collecting co-payments could result in unwanted audits and financial stress.  

Is forgiving  co-payment a fraud? 

The issue here is not a matter of being sympathetic or kind to the patient’s plight. Some would argue  long-time loyal patients deserve a discount, and even if you wish to provide, apply discounts both to the plan’s  portion and the patient’s copayment to avoid getting ripped off. 

For instance, if the provider’s charge for a particular service is $400, with $200 paid by the insurer and  the other $200 is the patient’s co-payment: and you have decided to waive off copayment as a  regular business practice, then you should offer a discount to both the parties . The non disclosure of such unlawful practice to the insurer risks possible allegations. 

Here are the following options concerning discounting co-payments without question: 

  1. The practice of no discount/waive co-payments. 
  2. To stay within the boundaries of law and provide discounts, a provider should consider offering the same extent to the insurer and the patient. Thus, a 25% discount on the insurance  payment amount as well as the co-payment can be a good option. 
  3. The next safest course for the provider is to notify the insurer about the discounted co-payments to a particular patient for a specific claim. Send a letter to the payor for the claim  form. Also, do not forget to offer a similar discount to the payor for any breach. 
  4. Every state’s laws related to discounting co-payments are different. Some states  specifically state that collection of co-payment is a must, irrespective of in-network  charge. 

Reasonable efforts to avoid overbilling and collecting co-payments 

  • Offer easy payment plan: Offering different payment options such as credit/debit card, online  payment portal, and auto-pay on specific dates help co-payments. 
  • Send billing statements: Utilize the resource at your disposal to send billing statements and monthly reminders of the  balance amount.
  • Keep up with collections: If you are struggling with financial stability, it might be time to consider  outsourcing professionals for the uncollectible amount. 
  • Follow the rules: Disconnect with patients who insist on writing off/ not collecting co-payments  and are not willing to pay his/her portion.