This calculator vs. hiring a PPO fee negotiator

What each one is for

A PPO fee-schedule negotiation service does the part this calculator cannot: it contacts a carrier and actually negotiates a higher contracted allowed fee. These services generally charge one of two ways — a flat fee per payer contract, or a percentage of the reimbursement increase they secure, sometimes continuing as a share of the higher collections going forward. That is real, billable work, and if a contract is worth renegotiating, a service that does this full time is better placed to do it than a practice owner between patients.

This calculator does the part that comes before paying anyone. It takes one month of production and contractual write-offs, split by carrier — a report every practice management system already produces — and ranks every plan by the dollars its write-off takes, with the effective reimbursement rate printed alongside. Those are frequently not the same plan: a low-volume plan can carry the worst rate in the practice and still cost the least in dollars, while a middling-rate, high-volume plan quietly takes the most. Paying a flat per-payer fee, or a cut of the increase, on the wrong contract is money spent on the plan that looked worst rather than the one that actually mattered.

It also answers a question worth settling before any negotiation begins: whether raising your own posted fee schedule would collect anything at all. A PPO's allowed fee is a contracted dollar amount, not a percentage of whatever the practice charges, so raising your own fee schedule on already-contracted procedures raises the write-off by the same amount it raises gross production and collects nothing. Only a changed contracted rate — the thing a negotiator is hired to get — touches money a PPO agreement has already locked in. This calculator prints both figures side by side so that difference is visible before a fee schedule change or a negotiation engagement is chosen.

The two are sequential, not competing: this calculator to find and size the problem for free, a negotiation service to actually fix the contract if the dollars justify the fee. This page is arithmetic on numbers you provide, not a negotiation, a guarantee of any carrier response, or advice about which service to hire.

This tool needs no account and no sign-in: it is a static page, the arithmetic runs in your browser, and nothing you type is uploaded anywhere.

Common questions

Should I use this calculator or hire a PPO fee-schedule negotiation service?

Both, in that order. A fee-schedule negotiation service does something this calculator cannot: it contacts carriers and actually renegotiates a contracted rate, usually charging a flat fee per payer or a percentage of the increase it wins. This calculator does not negotiate anything and cannot promise any carrier will move. What it does first, for free, from one month of your own production and adjustment numbers, is tell you which of your contracts is actually costing the most in dollars — not which has the worst rate, which is often a different plan — so that a flat per-payer fee or a percentage cut goes toward the contract that is genuinely worth pursuing rather than the one that merely looks worst on paper.

How do PPO fee-schedule negotiation services usually charge?

Typically one of two ways: a flat fee per payer contract, or a percentage of the reimbursement increase the service secures, sometimes billed as an ongoing share of the higher collections. Either way you are paying for the negotiation itself, not for knowing which contract to negotiate first — and concentrating that spend on the plan with the largest write-off in dollars is what this calculator's ranking is for.

If I raise my own fee schedule, is that the same as negotiating a better contracted rate?

No, and conflating the two is the single most common reason a practice thinks it fixed a write-off and did not. A PPO's allowed fee is a contracted dollar amount, not a percentage of whatever the practice charges. Raising your own posted fee schedule on a procedure that is already contracted raises the gross production figure and the write-off by exactly the same amount, and collects nothing. It only moves money on production that is not covered by a plan. A negotiator changes the contracted allowed fee itself, which is the only lever that touches money already locked in by a PPO agreement. This calculator prints both figures side by side so the difference is visible before either is attempted.

Does this calculator negotiate with insurance carriers?

No. It is arithmetic on numbers you already have — one month of production and contractual adjustments, per plan, from a report your practice management system already produces. It has no contact with any carrier and cannot promise any contract will change. That work, if you want it done, is what a fee-schedule negotiation service is hired to do.

Is a bad reimbursement rate the same problem as a big write-off?

Often not, which is exactly where a flat per-payer negotiation fee can be spent on the wrong contract. A low-volume plan can carry a terrible rate and still take a small number of dollars out of the practice each month, while a high-volume plan with a middling rate can be the one actually costing the most. This calculator ranks every plan by write-off dollars, with its rate printed alongside, so the two questions — which rate is worst, and which contract is worth paying to fix — are answered separately rather than assumed to be the same plan.

Open the Dental PPO Write-Off Calculator to run your own numbers.