If you pay your providers on net production, we recommend turning on the Auto Post PPO Write-Off option in Settings and then using a custom production report.
Turning on the Auto Post PPO Write-Off provides the most accurate account of net production because since insurance adjustments are automatically entered into the ledger when claims are created, our reporting system captures gross production and the insurance adjustment and calculates net production all on the same transaction date. To gain the benefit of this feature, you also need to create the claim on the procedure date of service. That way the service date and the claim creation date are the same. To view a video that demonstrates how this switcher impacts the ledger and day sheet, follow this link: The impact of the auto post ppo write-offs on the ledger and day sheet: Should you turn this on or off?
Another significant benefit of turning on the Auto Post PPO Write-Off is that it will provide you a more realistic Accounts Receivable report. If the Auto Post option is turned off, then your AR Report reflects only the UCR fees and it is impossible to know how much you actually should be collecting vs. how much you will end up writing off. With the Auto Post option turned on, you can more confidently look at your AR Report and know this is due to your office.
The only reason a dental practice may hesitate to turn on the Auto Post PPO Write-Off option is that they are concerned that their fee schedules are wildly inaccurate, and that by having to enter an additional insurance adjustment once the EOB is received, the ledger may look “messy”. Our recommendation in this situation is to invest time and resources to make your fee schedules accurate, and understand that an additional insurance adjustment into the ledger will occur and is nothing to be afraid of.
The best report to show each provider’s net production is the Provider Production report. This is a pre-built report in the financial tab of power reports that is based upon the transaction date. There is one change that needs to be made to this report - and that is to the filter. Right now the filter is referencing the service date - and that needs to be removed and reset to the transaction date.
To do this:
First, look at the filters on this report - click the X beside the Month filter to delete it
Next, you're going to add the correct filter - find the Transaction Date - Month and right click on this to filter on previous month.
When you right click and choose filter, you see this window - choose Previous month and okay.
Now your report has all the settings based on transaction date.
Here is a sample of what that report will look like (this includes the primary guarantor name for auditing purposes which is not a default setting in this pre-built report):
In order to maintain consistent reports that do not change, we recommend tightening your Transaction locking and running regular audits. The primary reason for inconsistent reports is that the transaction locking has been edited by a user in order to enter back dated transactions – and as soon as that happens, that changes reports in the past.
So, as you establish your auditing procedure, the first thing you will want to do is confirm that your transaction locking has not been changed. You also can restrict the rights to change transaction locking and educate all team members who have this ability on the impact of back dating.
Next, we recommend running a more detailed report – adding in patient and primary guarantor names – and saving this into a file for the sole purpose of simplifying any investigation into why previous report numbers have changed.
Here are the instructions:
- At each payroll, run the regular provider compensation report – save.
- Next, run the same provider compensation report and add in primary guarantor and patient names – this will be saved for future auditing.
- On a quarterly basis, re run the last 3-6 months of provider compensation using the same dates and confirm that the numbers for production or collection are the same. If you see any differences, then go back to the detailed reports to find the specific patient and ledger differences.
Handling initial balance forward adjustments impact
If your practice recently converted to Dentrix Ascend and you will be manually bringing over patient balances from your legacy software, you may want to consider how these adjustments are set up and how to maintain accuracy of your doctors compensation reporting.
Our recommendation for setting up these adjustments is:
Initial balance forward – default to production
Initial Credit balance forward – default to collection
For practices that pay providers on net production, you can see that when you enter the initial balance forward adjustment (and it is set to impact production), this would inflate the provider's production - on treatment the provider has already been paid for. To avoid paying your provider twice, we recommend using the report above and including a filter to exclude the initial balance forward adjustment.
For practices that pay providers on collections, there is no impact when the initial balance forward adjustment is set to impact production.
To review the full article on setting up adjustments: Common Adjustments and How to Use Each One.
How the Day Sheet Compares
The estimated net production in the day sheet will not match the net production in the provider production report. This can occur for several reasons:
#1: The day sheet’s estimated net production number is referencing the service date, while the provider production report references the transaction date.
The following reports are based on transaction date:
- Deposit slip
- Power Reports – you can choose the transaction date
- Aged Receivables
The benefit to using the transaction date in all your reports is that there are a variety of power reports to deep dive into exactly what occurred – by patient, procedure, insurance, adjustment, on any timeframe – and this allows your doctors/team to build confidence that the numbers match and make sense. By not using the day sheet, you avoid the entire series of questions around why reports do not match.
#2: If there is any amount in the Estimated Insurance Write off line on the day sheet, that will prevent reports from matching because this is an estimate of what will happen in the future when the claim is created and the adjustment posted into the ledger. This is not a transaction that you can find listed out by individual patient because the adjustment does not exist in the ledger – and therefore cannot be captured in another report. - If you have auto post turned on and you see an amount listed in this Estimated Insurance write off line on the day sheet, you may want to go to Home / Create claims to look for any patients/procedures on that date of service that have not yet been created and need to be.
#3: The estimated net production in the day sheet only takes primary insurance into consideration, not secondary insurance. The provider production report includes both primary and secondary insurance adjustments.
#4: Additional credit adjustments posted outside the date range on the day sheet report will also cause these reports not to match. For example, let’s say the Auto Post is turned on and in January, procedure is completed, the claim is created and the adjustment is created/auto posted into the ledger. Then, in February, insurance pays less than expected and an additional insurance adjustment is posted. The estimated net production for January will not reflect the additional insurance adjustment, while the provider production report run for January will include all credit adjustments.
#5: If the Auto post option is turned off, then your day sheet will be drastically different than your provider production report because of reason #2 above impacting every insurance patient.
Also, if you choose to turn off the auto post option, the provider production report is still the best report to use for paying providers.
#6: If the Auto post option is turned on, but claims are not created on the day of service, then the estimated net production in the day sheet will be different from the provider production report.
#7: In a multi-location group where dentists travel between offices, if charges are entered into the wrong location, then the day sheet for a location will not match the provider production report.
#8: If transaction locking allows backdating into a prior period and items are deleted, this also will cause reports not to match.
One more recommendation: Use the Provider Production Report rather than the Adjusted Production Report
The Adjusted Production report will only factor in the insurance adjustment for primary insurance only. It also does not include any of the additional adjustments, such as professional courtesy, etc. until they are posted. The Provider Production Report as outlined above will include all posted adjustments.
So, what is the purpose of the day sheet?
The day sheet is helpful to get an estimated net production number in real time as the day progresses and ends. For practices with a daily net production goal for the office, viewing this report provides a guide of “how did we do today” from an operations perspective. For the accounting functions of matching other reports and paying providers, different reports are recommended.
(Article authored by J. Alldredge, J. Nesbitt 2019)