Contract Analysis Service at your service
May 21, 2012
By Kelly Soderlund, ADA News staff
By the time you’ve navigated your way through the pages and pages of your contract with a dental benefit company, you might be cross-eyed.
It’s OK. And natural. It’s important you understand what you’re signing and what it means to you and your practice. But it’s also important to understand there is help available.
The ADA’s Contract Analysis Service provides a clear, plain language explanation of contract terms and is designed to allow dentists to make informed and independent decisions on the merits of participating dentist contracts. The service is free to members who request a review through their constituent dental society and costs $50 for members who contact the ADA directly.
The ADA News has been running periodic articles featuring some of the issues the Contract Analysis Service can clarify when it comes to dental benefits. The first article (ADA News, Feb. 6) covered affiliated carrier clauses. The second story (ADA News March 19) outlined how the service can assist with national processing policies, billing for component or denied dental procedures and removal from network lists.
The Contract Analysis Service can also provide information to members with questions about most favored nation clauses, hold harmless agreements, termination of agreements and utilization review.
Most favored nation clauses
A most favored nation clause means the dentist agrees not to charge higher fees to patients covered under a particular plan than to the dentist’s other patients. For example, if a fee specified for a particular procedure under one plan exceeds the fee the dentist would charge a patient from another plan for the same procedure, the dentist is contractually bound to charge the first patient the lesser fee.
Some dentists have run into this issue when they received an explanation of benefits statement that showed a lower maximum allowable fee than what they had agreed to with the network carrier.
“Dentists have the right to ask to have this clause omitted from the contract before they sign it,” said Dr. Jim Richeson, chair of the ADA Council on Dental Benefit Programs. “Although contract terms are meant to be negotiated, dentists may find the dental benefits company unwilling to change the terms of the agreement. Dentists may also want to seek counsel from their personal attorney regarding the legality of the provision, since some states have restrictions on such clauses. The Contract Analysis Service can provide clarity to contract provisions, which can help members understand what they are signing.”
Hold harmless agreements
Some contracts with dental benefits companies include hold harmless agreements, which shift liability from the insurance company to the dentist. Depending on how the contract is worded, dentists may be responsible for the cost of hiring legal counsel and any losses incurred by the carrier for any claims or lawsuits brought against the dental benefit company arising out of treatment rendered by the dentist.
Typically, state law requires dentists to pay for their own negligence but hold harmless agreements may require dentists to also pay for someone else’s negligence. These clauses are contractually assumed obligations, which means that the added liability is derived from the contract and not required under state law.
“Check with your professional liability insurance carrier to determine if your policy covers contractually assumed liabilities,” Dr. Richeson said. “We recommend dentists consult with their personal attorneys and professional liability insurance carrier before they sign a participating provider contract with a hold harmless agreement to understand the potential legal and financial obligations.”
Termination of agreement
There have been instances where a carrier will terminate a provider contract without cause. Some carriers will allow either party to terminate an agreement without cause or for certain reasons with cause within a certain time period with written notice.
If this happens, ask why, Dr. Richeson advises. Other questions to ask include: after the contract is terminated, do any of the contract rights or obligations remain in force; does the work in progress need to be completed; and are you still bound by the maximum allowable fees for work you have completed after the contract is terminated?
The Contract Analysis Service can also clarify these termination provisions.
Some dentists have had the unfortunate experience of being on utilization review by a carrier. It often happens when the carrier thinks a provider reported a certain procedure much more than their peers.
Utilization review is a statistically-based system that examines the distribution of treatment procedures based on claims information. The analysis should take into consideration the type of practice, dentist’s experience, socioeconomic characteristics and geographic location.
Dentists who are flagged in a carrier’s system must have their claims reviewed by the carrier and are asked to submit additional documentation regarding the need for providing the particular service.
“We recommend that dentists ask the carriers what it will take to get them off utilization review,” Dr. Richeson said. “Dentists should be informed if the patient’s billing records and charts will be audited. They should also be advised of any refund requests that may result, and carriers should provide appeal information.”
Dentists who continue to have problems and find the carrier uncooperative should consult their personal attorneys to determine whether the audit process has exceeded the terms and intent of their participating provider agreement, Dr. Richeson said.
For more information on the Contract Analysis Service, visit Contract Analysis Service.