Chapter 17

Question 1

What is the definition of a dental preferred provider organization (PPO)?

Answer 1

A network of dentists created through a contractual agreement between a dental program administrator and providers, for the delivery of services to defined patient populations, where reimbursement is based on predetermined, discounted fees.

Question 2

Dental PPOs are now the dominant dental delivery system with a market share of (74 / 94)
percent by enrollment.

Answer 2

74 percent of market share by
enrollment.

Question 3

True or False: A condition that contracted PPO dentists do not have to abide by is peer review and oversight processes established by the administrator.

Answer 3

False

Question 4

True or False: Contracted PPO dentists must agree to maintain certain standards of practice
and levels of malpractice insurance.

Answer 4

True

Question 5

Dental PPOs far exceed enrollment in (indemnity / discount / DHMO / all three) type plans.

Answer 5

All three plans

Question 6

What factors fueled PPO growth?

Answer 6

Increased demand from purchasers; increased dedication of carrier recruiting efforts; greater acceptance of PPOs among the dental community.

Question 7

In 2010, about _____ percent of actively practicing dentists in the U.S. participated in at least
one PPO.

Answer 7

64 percent

Question 8

In 2011, PPO providers participated in an average of 8.8 networks, an increase of _____
percent from the 2008 average of 5.9 percent.

Answer 8

49 percent

Question 9

What are two notable trends initiated by administrators?

Answer 9

Administrators have (1) become more flexible in negotiating with providers and (2) increased the use of tiered networks.

Question 10

True or False: The higher the fee schedule, the more dentists will be willing to participate and
the greater the size of the network.

Answer 10

True

Question 11

In reviewing the section on PPO participation trends, several points relate to patient volume.
Identify those factors most likely to improve cash flow for PPO providers.

Answer 11

Steady cash flow; increased visibility; maintaining patient volume; new patient referrals; greater needs of new patients; elective services

Question 12

Client base, geographic location of providers and customers, degree of market power
possessed by the providers and the administrator are all factors that need to be considered in
developing __________.

Answer 12

PPO fee schedules and the level of network discounts

Question 13

What are PPO schedules based on?

Answer 13

Discounts off the community average and the average of submitted fees based on claims; a targeted percentile.

Question 14

For large, national networks, a strategy considered financially sound, and often better for
recruiting efforts, is to have (more / less) fee schedule zones.

Answer 14

more

Question 15

True or False: Due to today’s economic uncertainty, it has become quite uncommon for carriers
to negotiate unique fee schedules with individual providers.

Answer 15

false

Question 16

Basic dental PPO plans have propagated a profusion of hybrid varieties, distinguished by the
way they affect __________.

Answer 16

Access and cost.

Question 17

What are the two primary types of PPOs that dominate the market today?

Answer 17

Active and passive PPOs.

Question 18

What is the key characteristic of a passive PPO?

Answer 18

The benefit design is the same irrespective of whether or not the patient goes to a participating dentist

Question 19

True or False: Under a passive PPO agreement, participating dentists are not allowed to
“balance bill” any amount over and above the fee schedule for covered services.

Answer 19

True

Question 20

Why were passive PPOs considered a transitional product in the dental market?

Answer 20

Passive PPOs were attractive to groups looking for a “gentle managed care step” in their dental program

Question 21

What plan feature makes the passive PPO model popular and well received by participants
and purchasers?

Answer 21

Participants can go to any dentist they choose with no reduction in benefit design

Question 22

Why were purchasers incentivized to migrate to active PPO plans?

Answer 22

The desire to contain costs motivated purchasers to steer patients to network dentists.

Question 23

What is the key characteristic of an active PPO plan?

Answer 23

The benefit differential between in- and out-of-network care

Question 24

What financial incentives help to steer participants to network dentists?

Answer 24

Lower participant coinsurance and deductibles and/or higher annual and lifetime maximums

Question 25

Why do many plan sponsors, dentists, and patients view the active PPO as a win-win scenario?

Answer 25

Sponsors can offer richer benefits at an affordable price; network dentists increase traffic and patient loyalty; patients get more for their benefit dollar

Question 26

What pushes patients away from seeking treatment from out-of-network dentists?

Answer 26

Reduced benefits and (possibly) higher fees

Question 27

True or False: In an exclusive provider organization (EPO) plan patients have access to
benefits when they seek care from a dentist not in the network.

Answer 27

False

Question 28

EPOs are created for which segment of the dental market?

Answer 28

A particular employer with a large or highly concentrated employee population

Question 29

What is the most distinguishing feature of a POS plan?

Answer 29

Members do not have to choose any particular dentist or network during annual open enrollment. They are free to switch at will with benefits available at point of service.

Question 30

The most common POS dental benefits program combines design features of __________
and __________.

Answer 30

PPOs and DHMOs