Medicaid Fraud: The Most Profitable Business Model in American Dentistry
Respected publication, Kaiser Health News, discusses a question that many patients must wonder about, “Why are dentists sometimes pushy?”.
The article starts off by looking at the experience of one dentist, Dr. David Silber. Dr. Silber recounts how in 1993 he lost his first job at a dental clinic because he turned away a patient he had been assigned after the original dentist was unable to make the appointment. The patient was due for crown preparation work. Dr. SIlber took a look at the tooth in question and found absolutely nothing wrong with it and the crown preparation was canceled. He was fired that very day.
Though the story took place decades ago, Dr. Silber contends that such incidents continue to occur. In other words, there are many patients who are scheduled for procedures they have little or no need for. The reason for this and the heart of the article is that the way insurance reimbursements are structured often leaves many dentists feeling short-changed. In order to ramp up their revenue, they push their patients to have more procedures and more products than they actually need. They may even recommend treatment plans that are more expensive than equally effective alternatives.
The coronavirus pandemic had a devastating impact on many dental clinics, which, in many states, were not considered essential services and were forced to shut down during the initial stay-at-home orders. Even when lockdown rules had eased, many patients were fearful of contracting Covid-19 and stayed away, or, rules regarding the number of people that could be in a clinic at the same time, limited the number of patients a dentist could see. This led some unscrupulous dentists to push high-cost treatment plans, and additional procedures and plans onto patients. In 2013, these practices were termed, “creative diagnosis” by a dentist who lamented the prevalence of such practices. One example, found in a study done in 2019, of this is the use of teeth whitening in dental clinics as opposed to dentists recommending the equally effective but much cheaper (by 1000%) option of using whitening strips.
The practice of creative diagnosis has led some unethical dentists to actual fraud. The issue is so great and the incentives to do so so large, that Medicaid fraud is seen as the most profitable business model in American dentistry.
Although many cosmetic dentists have high ethical standards and perform safe and effective procedures every day, there is a huge problem in dentistry in America. One study suggests that between 3% and 10% of the estimated $3.6 trillion spent each year on healthcare is lost to the kind of fraudulent activities we have discussed. Considering that Americans spend $136 billion a year on dental care, we can extrapolate that analysis to dentistry, to suggest that between $4.08 billion and $13.6 billion is lost to fraud.
So, we can analyze the situation as a question of bad incentives. There are simply too many incentives to commit fraud, that only dentists with the highest ethical standards can resist the temptation. Luckily for the industry, it seems that the majority of dentists have such ethical standards.