Washington’s largest dental insurance provider cut its reimbursement fees more than two months ago, but the decision continues to roil dentists and the patients they serve, as illustrated by the local and statewide reactions so far.
Seattle-based WDS, which insures about 2.5 million patients in the state, in June reduced the amount it pays dentists for their work by an average of about 15 percent.
Some Southwest Washington dentists have dropped WDS, saying the cuts left them no choice if they want to stay in business and provide good customer service.
Others, however, are grudgingly accepting the reductions, aiming instead to lower their expenses to offset the impact from WDS’ decision while keeping prices affordable for patients.
Across the state, many dentists are taking a wait-and-see approach, said Kainoa Trotter, director of membership and communications for the Washington State Dental Association, a trade group for dentists that has more than 4,000 members.
Trotter said many dentists are “talking to their patients, seeing how it will go, seeing if their patients will remain with them if they drop WDS or if they’ll go somewhere else.”
As dentists adjust their business practices to cope with WDS’ lower payments, some patients will face a choice: Either stay with a dentist who no longer takes their insurance — and pay higher out-of-pocket costs — or find a dentist who accepts WDS.
Wendel Family Dental Centre, which has three offices in the Vancouver area, severed ties with WDS. But the company is offering patients with WDS insurance a discount program to “keep your out-of-pocket more in line with the costs you are familiar with,” according to a letter to patients by owner and dentist Roger Wendel, and Jennifer Sigman, the company’s office administrator.
Sigman said Wendel refused to accept WDS’ rate cuts partly because they would have sliced heavily into revenues, but also, the company would have been forced to make changes that would have negatively affected the level of patient care, Sigman said.
“This is an average 15 percent off of an already really low rate,” Sigman said, adding that for several years WDS hadn’t raised insurance rates to cover inflation.
‘A major change’
For its part, WDS says it had to make the cuts in reimbursements to dentists or lose business. Employers, seeking to reduce their employee benefit costs, are entertaining lower rates from WDS’ competitors and demanding the insurer lower its policy fees, according to the 14-member WDS board.
Tom Gates, vice president of planning for WDS, said 11 out of 250 preferred dental providers in Clark County have terminated their relationships with WDS since the rate cuts went into effect on June 15.
WDS, a member of the Delta Dental Plans Association — an organization that offers dental coverage nationally — has offset those terminations by adding dentists to its pool of providers, Gates said.
Gates said WDS understands that dentists have to make the best decisions for their businesses in light of the insurance-fee reductions. “We recognize that this is a major change for these dentists,” he said.
But area dentists say it’s not just WDS’ decision to slash reimbursement fees that frustrates them. WDS also is penalizing them for choosing to drop the insurer and become out-of-network providers, they say.
When WDS agrees to pay a portion of the cost of a cleaning, a filling or a crown — say 100 percent, 80 percent or 50 percent, depending on the procedure — dentists say the insurer is using unrealistic estimates to determine what a dental office’s costs should be.
For example, instead of covering 80 percent of a $255 filling, thus reimbursing dentists $204, WDS says the filling should cost $121, said Jill Markos, who has practiced general dentistry in Vancouver since 1993. If WDS covers 80 percent of that lower figure, it would reimburse dentists with $96.80. That’s $107.20 less than a dentist might think he or she is due from WDS. “They are not paying 80 percent like it says on their plan,”
Markos said. “They’re paying 80 percent of a reduced out-of-network fee schedule.”
That effectively puts the patient on the hook to cover the roughly $158 gap between what the dentist charged — $255 — and what the insurer paid — $96.80, Markos said. “They’re pretty much telling my patients, ‘You don’t have dental insurance anymore.’”
Sigman, the Wendel office administrator, said she’s seeing the same problem. WDS is making “it very difficult for patients to be out of network,” she said.
Cutting costs to cope
Gates, the vice president of planning for WDS, said the insurer reimburses out-of-network dentists “based on what we think is appropriate.” He said WDS “feels a strong affinity for our member dentists” and that the organization “wants our patients to see those (in-network) dentists, and we want the business to go their way.”
Gates said he doesn’t know what WDS’ reimbursement fees will be in the years ahead. “We’re monitoring this very closely, and we’re listening to what the dentists have to say to us.”
Some area dentists who don’t like the insurance-fee cuts made by WDS have nonetheless accepted them.
Jeromy Dixson, a dentist and president of Smiles Dental, which has five offices, including three in Clark County, said accepting the rate cuts enables his patients to remain in-network and to keep their out-of-pocket costs low.
In response to the rate cuts, which would amount to an estimated $230,000 to $240,000 reduction in Smiles Dental’s annual revenue, Dixson said his company is looking to cut lab, marketing and other costs.
The company will save an estimated 50 percent on lab fees by bringing some of its lab work in-house, Dixson said. Meanwhile, the company’s revenues are up this year despite the insurance-fee cuts implemented by WDS, Dixson said.
Dixson said he understands the powerlessness many dentists feel over the decision by WDS. He said he wrote a letter to the WDS board about the situation but hasn’t heard back.