Billing & Accounts
This document is used to transmit financial information from the treatment area to the business office and often initiates the charge entry process.
What is a charge slip?
The category that includes all money owed by the practice (bills, vendor invoices) is called what?
What is accounts payable?
he federal tax withheld from employee wages that funds Social Security is commonly called by this acronym.
What is FICA?
he ADA-developed code system used to report dental procedures is called what?
What is Current Dental Terminology (CDT) / Code on Dental Procedures and Nomenclature?
Endorsing a check so that it can only be deposited to the named individual's account is called what kind of endorsement?
What is a restrictive endorsement?
The statement given to patients immediately at checkout that shows the current balance of services rendered that day.
What is a walkout statement?
Define disbursements in the context of dental office overhead.
What are the payments made to satisfy accounts payable (expenses paid out by the practice)?
Name two common payroll deductions.
What are income tax withholding (federal/state) and other deductions such as health insurance premiums, retirement contributions, or wage garnishments?
Define the "usual, customary, and reasonable" (UCR) fee components: give a one-sentence definition for each term.
Usual fee—the dentist’s charge for a service; Customary fee—the fee range charged by similarly trained dentists in the area; Reasonable fee—a fee justified by special or complex circumstances?
Name two examples of dental insurance fraud from the text.
What are: billing for services not provided and changing fees on a claim to obtain higher payment? (Accept other examples given: disregarding copayment/deductible and writing it off.)
Name two primary responsibilities included under managing accounts receivable in a dental practice.
What are recording payments (cash handling) and monthly statements/collections? (Accept: monitoring balances and follow-up on unpaid accounts.)
Explain the difference between expenses and disbursements and give one example of each in a dental practice.
What is: Expenses are incurred costs (e.g., supplier invoice for dental materials); disbursement is the payment of that expense (e.g., check written to supplier)?
Explain what a stop payment order is and one reason an account holder might request one.
What is an instruction by the account holder to the bank to not honor a specific check; reason: lost check, suspected fraud, or dispute over payment?
What is "coordination of benefits" and what common rule determines primary coverage when both parents carry dental insurance for the same dependent child?
What is the process to prevent duplicate payments by determining which policy pays first; the "birthday rule" (policyholder with earlier birthday in the year is primary) commonly determines primary coverage between two parents?
Explain the "Least Expensive Alternative Treatment" (LEAT) limitation and one ethical consideration a dentist must balance when treatment recommendations conflict with LEAT.
What is: LEAT requires insurers to consider the least expensive clinically acceptable option for coverage; ethical consideration: practitioner must balance patient best interest and clinical judgment against insurer cost limits—documenting medical necessity if recommending superior treatment is warranted.
The process and practice of recording, classifying, and summarizing financial transactions in the practice is called this; the more mechanical recording activity is referred to as what?
What is accounting, and what is bookkeeping?
Describe the purpose of a check register and name three data elements that must be recorded in it.
What is a record of all checks issued and deposits; elements include check number, date, payee, amount, and resulting balance?
Describe the key steps a dental practice must take to remain compliant when collecting and remitting payroll-related government taxes.
What are (1) accurately calculating withholdings per employee and required deposits schedule; (2) timely depositing employer and employee portions of payroll taxes to the appropriate federal/state agencies; (3) filing required returns (e.g., quarterly Form 941, annual W-2/W-3) and maintaining payroll records for required retention periods?
List and briefly describe three different types of dental insurance plan structures mentioned in the text.
What are: (1) Capitation plans—provider paid a fixed amount per patient regardless of services; (2) PPO (Preferred Provider Organization)—network of providers with negotiated fees and patient cost-sharing; (3) Direct reimbursement or fee-for-service plans—insurer reimburses a portion of the dentist’s billed fee or patient is reimbursed directly?
Describe three elements that should be included in a clearly defined financial policy for a dental practice.
What are: (1) Payment expectations and accepted forms (insurance, credit, payment plans); (2) Patient responsibility for co-pays/deductibles and timing of payment; (3) Collections procedures for delinquent accounts including timelines, late fees, and possible referral to collections—plus privacy/HIPAA handling of financial communications.
A patient has not paid after repeated collection attempts. Describe three escalating steps in collections a dental office might take before writing off the balance, and the ethical/legal considerations for each step.
What are (1) sending increasingly firm written notices and calls—must respect privacy/HIPAA; (2) offering payment plans or financial arrangements—must document terms and avoid discrimination; (3) referring to an outside collection agency or small claims court—must follow state law, notify patient, and ensure accurate records to avoid wrongful claims?
A dental office needs to analyze cash flow to plan for future capital expenditures. List and describe three financial indicators or reports that should be used to support such planning.
What are (1) accounts receivable aging report—to project incoming cash and identify delinquent accounts; (2) monthly income statement/profit & loss—to show revenue vs. expenses and net operating cash; (3) cash flow projection/budget—to forecast months of cash on hand and timing of major disbursements?
A payroll audit reveals repeated misclassification of staff as independent contractors. Explain the financial and legal implications and corrective actions.
What are: Misclassification can result in back taxes, penalties, and liability for unpaid benefits; corrective actions include reclassifying workers properly, retroactive payroll tax withholding and deposits, correcting filings, and updating HR/payroll procedures to ensure correct classification going forward?
A claim form is processed electronically but the carrier denies payment for lack of documentation. Outline five pieces of documentation or information the practice should include or retain to support an appeal.
What are: (1) Completed claim form with accurate CDT codes and tooth numbers; (2) Detailed narrative of procedure and clinical findings; (3) Radiographs or intraoral photos demonstrating need; (4) Preauthorization/benefits verification records showing eligibility and coverage limits; (5) Superbills/charge slips and signed patient consents or assignment of benefits?
A new office manager discovers an apparent embezzlement scheme: repeated small check alterations and diverted deposits. Draft a concise action plan of five immediate steps the manager should take that protect patients, staff, and the practice while preserving evidence.
What are: (1) Secure financial records and restrict further access to accounting systems; (2) Notify the dentist/owner and place involved staff on administrative leave pending investigation; (3) Preserve copies of bank statements, canceled checks, and electronic transaction logs for investigators; (4) Contact legal counsel and the bank to place stop payments or holds as appropriate and to determine reporting requirements; (5) Initiate an internal audit and then report to law enforcement if evidence supports criminal activity, while complying with privacy laws and informing insurers if necessary.