PPO (Network) Leasing

PPO (Network) Leasing | 1

At the American Dental Association, we often hear from dental offices wondering how it

is possible that they are a network dentist for a dental plan even though they did not sign

a participating provider agreement with that particular plan. How can this happen?

Did you signed an agreement with an affiliated carrier’s clause?

An affiliated carrier’s clause in an agreement makes the dentist a participating dentist for the affiliated plan. Dental

insurance and PPO leasing companies may lease their network to insurance companies with a limited or small

network or to third party administrators that do not have access to a network of dentists. Dentists agree to

charge discounted fees in order to gain access to these patients. These patients then have access to

network dentists with reduced fees.

Unfortunately, it has been reported that some of these plans fail to notify dentists that the dentist is now a

participating provider with a new plan. Even though the dentist treats the patient expecting to receive his or her

full fee, they are then surprised when their office receives an explanation of benefits (EOB) statement indicating a

reduced fee and restrictions against balance-billing the patient.

There are potential advantages and disadvantages of utilizing plans with leased networks.

Some dentists may want the network exposure and opportunity to increase their new patient base. A potential

disadvantage is that dentists who signed contracts with one PPO plan can be shocked to find out that they are

now contracted with other plans. It is even possible that a dentist who signs a contract with one PPO plan may

have agreed to participate with dozens or even hundreds of plans across the country.

To prevent being caught off guard, important questions to consider asking before signing an

agreement with an affiliated carrier’s clause include:

 What fee schedule will be in effect?

 What processing policies will be utilized?

 How will you be notified when your name is leased to another plan?

 Will you have the option to opt out of participation with a specific plan?

Dentists should always carefully review EOB statements to verify that proper fees and policies are being observed

per the signed participating provider agreement. In addition, dentists should check to see if their state has passed

legislation regulating PPO leasing. At last count, twenty-four states have passed this type of legislation.

ADA Resources on Dental Insurance Contract Issues available at ADA.org:

 The ADA Contract Analysis Service can provide member dentists with information concerning a proposed

unsigned contract so you are able to better understand and analyze its terms. The service is free for member

dentists who request review through their state or local dental society.

 On-demand webinar The Growing Impact of PPO Leasing on Your Dental Practice

 A podcast episode called PPOs, Leased Networks and Your Practice: The Impact

PPO (Network) Leasing

PPO (Network) Leasing | 2

Additional information on valuable educational ready-to-use resources on innovative dental insurance solutions

for dentists can be found at ADA.org/dentalinsurance.

Comprehensive ADA Policy Statement on Inappropriate or Intrusive Provisions and Practices by Third

Party Payers (Trans.2016:290; 2017:266) (The following is taken from this policy).

Automatic Assignment of Participating Dentist Agreements: Contractual language which allows PPO

leasing companies and third-party payers to obligate the dentist to participate in any other third party payer or

managed care network without full disclosure of fees, processing policies and written consent from the dentist.

This is typically accomplished by selling or providing the discount rate information to any other third-party

payers and/or other managed care networks.