31.8% of Dentists Are Dropping PPOs. Here's the Playbook.
Nearly 1 in 3 dentists plan to leave PPO networks. The math stopped working when hygienist wages jumped 30-40% but reimbursements stayed frozen.
Nearly one in three dentists are actively planning to leave PPO networks.ADA HPI That's not a fringe movement.
Here's why the math stopped working.
The Write-Off Problem
The average PPO write-off is 42-45%. On a $1,200 crown, you're collecting $660-$696. Your lab bill alone is $96-$150. Your overhead on that procedure is roughly $500. You're making $160 on a procedure that took an hour of your clinical time.
Across a full year, practices with heavy PPO participation lose $350K+ in write-offs on $1M in production.
The Hygienist Math That Broke PPOs
This is the number that changed everything: your hygienist costs $45-60/hr. A PPO adult prophy (D1110) reimburses $50-70.
Read that again. You're paying your hygienist nearly the same amount the PPO pays for the entire cleaning. After supplies, overhead allocation, and front desk time, you're losing money on every PPO hygiene visit.
Post-pandemic hygienist wages jumped 30-40%. PPO reimbursement rates haven't moved in 30 years. That gap is now a canyon.
The DOC Access Act
The DOC Access Act (passed as part of recent federal legislation) is designed to increase transparency in dental insurance. Key provisions:
- Requires insurance companies to maintain an 85% medical loss ratio (85 cents of every premium dollar goes to actual dental care)
- Bans retroactive claim denials beyond 12 months
- Requires network adequacy reporting
This is a step in the right direction, but it won't fix your write-off problem today. If you're waiting for legislation to save your margins, you'll be waiting a long time.
The practices making moves now are the ones that'll come out ahead. Here's how they're doing it.
Sources: ADA Health Policy Institute surveys, ADA HPI PPO participation data, DOC Access Act provisions
The 12-Month PPO Exit Timeline
Don't drop everything at once. That's how you crater your schedule. Here's the timeline that works:
Months 1-3: Research and Preparation
- Run a fee schedule analysis for every PPO you participate with. Rank them by write-off percentage.
- Identify your worst PPO (highest write-off, lowest reimbursement). That's your first drop.
- Calculate your per-patient revenue by insurance type. You need to know what each PPO patient is worth vs. a fee-for-service patient.
- Build your membership plan (see our membership plan guide). Have it ready before you send a single letter.
Months 4-6: Drop Your Worst PPO
- Send a 90-day notice to the PPO (check your contract for the exact notice requirement).
- Send patient communication letters (template below) at 60 days, 30 days, and 1 week before the change.
- Offer your membership plan as the alternative. Price it to beat what patients were getting through the PPO.
- Track patient retention weekly. You'll lose some - plan for 15-25% attrition from that PPO's patients.
Months 7-9: Evaluate and Drop the Next One
- Measure the financial impact of dropping PPO #1. Most practices see a net revenue increase within 60-90 days because the remaining patients are now paying full fee.
- Drop PPO #2 using the same process.
- Ramp up marketing to attract fee-for-service patients. Redirect the money you're saving from write-offs into Google Ads and SEO ($2K-$4K/month).
Months 10-12: Stabilize and Scale
- You should now be collecting 20-35% more per patient on average.
- Your schedule may have fewer patients, but your production per visit is significantly higher.
- Evaluate remaining PPOs. Some practices keep 1-2 of the best-paying PPOs for patient volume.
Patient Communication Templates
Template 1: The 60-Day Letter
Dear [Patient Name],
We're writing to let you know about an upcoming change at our practice. Effective [date], we'll no longer be participating as an in-network provider with [Insurance Company].
This decision wasn't made lightly. Over the past several years, the gap between what it costs to provide quality care and what [Insurance Company] reimburses has grown to the point where we can't maintain the standard of care you deserve while accepting their contracted rates.
Here's what this means for you:
- You can still see us and use your insurance. Your plan likely has out-of-network benefits that cover 50-80% of procedures.
- We've created a membership plan for patients without insurance or those who want predictable costs. It starts at $35/month and includes cleanings, exams, x-rays, and 20% off all other treatment.
- We'll file all claims on your behalf. Nothing changes about how we handle your paperwork.
We value your trust in our practice and we're not going anywhere. If you have questions, call us at [phone].
Sincerely,
[Doctor Name]
Template 2: The Membership Plan Pitch (for follow-up)
Subject: A better deal than your dental insurance
Hi [Name],
Quick question: are you paying $50+/month for dental insurance that covers two cleanings and maybe half a crown?
Our membership plan costs $35/month and includes everything your insurance covers for preventive care - plus 20% off all restorative work. No deductibles. No waiting periods. No denied claims.
For most patients, the membership plan saves $200-$500/year compared to their current insurance premiums + copays.
[Link to sign up or call to learn more]
Break-Even Analysis: When PPO Exit Pays Off
PPO revenue: $540K (after 42% average write-off, gross production was ~$931K)
FFS revenue: $360K
After dropping all PPOs (assuming 25% patient loss):
Former PPO patients who stay: 75% of PPO patient base
New revenue from those patients at full fee: $698K (the write-offs disappear)
FFS revenue: $360K
New total: $1,058K
Even losing 25% of your PPO patients, you collect $158K MORE per year. That's the math that's driving 31.8% of dentists to make the move.
Which PPOs to Drop First
- Highest write-off percentage. If one PPO writes off 50% and another writes off 30%, drop the 50% one first.
- Lowest patient volume. If a PPO only represents 5% of your patients, the risk is minimal. Drop it and get comfortable with the process.
- Umbrella networks. Check if you're unknowingly in-network through umbrella contracts (Connection Dental, DenteMax, Zelis). These often have the worst reimbursement rates.
- Keep your best PPO for last. If one PPO reimburses at 80%+ of your UCR and represents significant volume, that one might be worth keeping.
The Membership Plan as Your PPO Replacement
Every patient you lose from a PPO is a potential membership plan member. The economics are dramatically better:
| PPO Patient | Membership Patient | |
|---|---|---|
| Annual preventive revenue | $180-$240 (after write-off) | $420 ($35/mo) |
| Crown revenue | $660 (after 45% write-off) | $960 (20% member discount on $1,200) |
| Claims filing hassle | High | Zero |
| Payment timing | 30-60 days | Day of service + monthly recurring |
Your membership patients are worth 2x what your PPO patients are worth. And they're more loyal - membership plan patients have 80%+ retention rates vs. 60-70% for PPO patients.
Ready to build your membership plan? Read our complete guide: Membership Plans Are Replacing PPOs. Here's How to Set One Up.
