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What are Illegal Dental Billing Practices & How to Avoid Them?

Your dental practice can be penalized, or you may face prison due to illegal activity during the billing process, such as wrong coding or manipulated date of service on the claim form. This crucial situation will damage your practice’s reputation and hurt revenue.

How this happens usually?

You may be practicing illegal activities during the billing process.

Therefore, you must know the factors that can lead your dental practice in such trouble.

Is your dental practice a victim of legal and financial penalties?

If yes:

You are in the right place where you will be able to know how illegal dental billing practices happen and how you can avoid them to minimize the potential risks and prevent revenue and reputational damage.

What Are Illegal Dental Billing Practices?

Illegal Billing Practices in dental Billing

Illegal dental practices include any actions violating state or federal dentistry regulations and insurance company guidelines. They often stem from either ignorance of the law or attempts to cut corners to increase profitability.

Therefore, an in-depth understanding of illegal and fraudulent activities will help address them efficiently and enhance the transparency and accuracy of billing tasks.

Let’s discuss each of the most common illegal dental billing practices:

1. Unlicensed Dentists

A dental assistant performs dental work (like filling cavities or extracting teeth) under proper licensure or supervision. But a dental assistant without professional certification in your practice is illegal and dangerous.

According to USA regulations for dentists, hiring dental assistants without a dentistry license awarded by governing bodies of dentistry is unlawful. As a result, your practice can be penalized. Additionally, untrained and unprofessional dentists cannot cure dental diseases, harming patient care.

2. Upcoding

Under federal and state laws, upcoding is considered fraud and illegal in dental billing. It happens when a dentist charges a higher fee than is necessary for a procedure to get more money from a patient or insurance company.

According to the ADA, upcoding reports a more involved and expensive procedure than was done. Upcoding is closely inspected by regulatory bodies and insurance firms to prevent overbilling and avoidance of insurance rules. As a result, dentists need to charge for the services rendered.

An Example of Upcoding in Dental Billing

Imagine a dentist sees a patient for a regular check-up, a simple procedure that’s valued at $60. Now, instead of billing accurately, they decide to sneakily use a code meant for a more detailed check-up, worth $100. By doing this, the dentist illegitimately pockets an extra $40 from Medicare, which is essentially money taken from the taxpayers’ pockets. This act of upcoding, submitting a false claim to gain extra cash, is a clear violation of the False Claims Act.

Upcoding, or billing for a higher-cost procedure than was performed, is fraudulent and can lead to hefty fines and penalties for your practice.

3. Waiving Co-payments

Patients pay copayments, deductibles, and other fees when they receive specific dental services.

It is illegal to waive deductibles and copayments since this encourages patients to buy services they might not need. Additionally, it weakens the insurance system by enabling providers to evade paying patients the appropriate sums. Additionally, because they may offer services at a lower cost than their rivals, it gives the supplier an unfair competitive edge.

4. Unbundling

Unbundling occurs when a dentist submits separate claims for services and procedures that should be billed as a single service, leading to a decreased benefit for the patient or beneficiary.

An Example of Unbundling in Dental Billing

Imagine a routine surgical procedure being performed by a dental provider. Now, instead of taking the usual route of using a standard billing code, this provider decides to enter separate codes for the incision and suturing, playing the system to their advantage. And what’s the result? A notable boost in the provider’s reimbursement, illegally.

In this case, the dentist aims to get maximum benefit by increasing reimbursement, which can lead to scrutiny and potential penalties for fraudulent billing.

5. Manipulating Dates

An additional form of unethical billing activity involves manipulating service dates on claims.

This occurs when a dentist files a claim with an inaccurate service date, such as invoicing for a dental crown on the date of preparation rather than on the date of seat/cementation.

An Example of Misrepresenting Dates in Dental Billing

Medical practitioners and healthcare facilities may make more money by stating they consulted with and took care of the same patient on two separate days instead of one.

Each “doctor visit” is commonly viewed as an independent billable service. Often the services listed on the claim forms were really provided, but the dates were false because it is more profitable for the providers. In some cases, there are strict limits for covering costs related to a surgery billed under a diagnosis-related group.

Providers will make it seem as if the follow-up or related care was provided outside the inclusive date to get reimbursed.

While seemingly unimportant, the service date holds significance regarding patient coverage, particularly in cases where treatments were administered before the plan’s effective date or waiting period.  Manipulating claims dates can be unethical and illegal, leading to financial and legal penalties.

6. Unnecessary Procedures

A common unethical practice in dentistry billing is the performing of unnecessary processes.

A dentist charges extra for services when certain dentists prescribe treatments or procedures that are not required. This can involve anything from suggesting further cleanings to suggesting pricey dental implants.

An Example of Unnecessary Procedures in Dental Billing

A dentist suggests scaling and root planing (SRP) or deep cleaning to treat a patient’s gum disease. However, routine cleaning might be enough if the patient has mild gum disease.

When a deep cleaning is not required, it can damage the patient’s teeth and gums and increase expenses.

Performing unnecessary procedures to increase charges in the patient’s bill is an illegal billing practice in dentistry. It can lead to legal consequences and financial penalties.

7. Phantom Billing

When a dentist bills for services that were never rendered, phantom billing occurs.

Since phantom billing is a type of fraud, it is prohibited. Patients may be forced to pay for services they did not obtain and run the danger of needless medical complications if they receive treatments they do not require.

How Do Illegal Dental Practices Occur?

Most illegal dental billing practices arise from either ignorance or greed. Sometimes, practice owners are unaware of the specific regulations governing their field. Others may feel pressured to increase profitability and thus cut corners.

Common Reasons

Common reasons include:

  • Lack of training or understanding of compliance requirements.
  • High-pressure sales environments.
  • Financial pressures due to rising costs and shrinking insurance reimbursements.

Major Effects

The dentists might face severe penalties and have their licenses revoked even if they are unaware of the fraud they are committing. Errors in filing insurance claim forms, intentional or unintentional, would result in serious legal action against the person who commits it if it is reported.

The effects of dental billing fraud also result in overcharging patients. Victims of such fraud are a common sight, with many being exploited due to their limited knowledge of what procedure has been conducted. In some instances, these victims are exposed to severe health threats due to the performing of unnecessary and often dangerous practices on them for the financial motive.

How To Avoid Illegal Dental Practices?

Dental practices and solo dentists must take extraordinary initiatives to curb illegal dental billing practices. Here is how they can ensure a smooth and transparent dental billing process.

1. Verify Licensing and Supervision

Dental practices must pay special attention to the professional credibility of their staff. Hire experienced and qualified dental specialists and assistants with professional education and dentistry certification.

Additionally, proper checks and balances must be kept to confirm the appropriate supervision, ensuring regulatory compliance. Implement a standardized onboarding process to verify credentials and assign appropriate responsibilities.

2. Avoid Upcoding

Medical codes in dental billing need a proper check to ensure accuracy. The dentist can avoid any future trouble if they properly check and code the services and procedures they performed during the patient’s visit.

Dental practices must teach dental staff the ADA coding guidelines and the CDT (Current Dental Terminology) codebook. In addition, dentists must also consider utilizing the practice management software. Hence, they can avoid upcoding issues during dental billing.

3. Never Waive Copayments

To deal with the waiving copayment issues during dental billing, dentists must communicate clearly with patients to make them understand the importance of copayments and deductibles.

Dentists should develop a policy that prohibits copayment waivers and apply it consistently. Additionally, dentists can implement payment plans to assist patients struggling with their share while ensuring compliance with insurance policies.

4. Avoid Unbundling Services

Dentists must comply with ADA and dental insurance guidelines to bundle the services properly. Additionally, they should utilize an efficient PMS to submit and review the claims.

Also, train your billing staff on correct dental coding and bundled services to avoid the chances of unbundling during the billing process.

5. Maintain Accurate Service Dates

Manipulating the date of services on the claim form can severely impact your dental practice’s credibility because fraudulent billing leads to legal and financial penalties.

Dental practices should mention actual dates on claim forms as treatment dates. Dentists should strictly check this severe concern to avoid any difficulty in the future.

6. Avoid Unnecessary Procedures

Dentists should avoid adding unnecessary procedures that are not performed. They must diagnose and document conditions thoroughly before recommending treatments.

Mention the actual procedures and seek a second opinion for cases involving extensive or expensive procedures.

7. Prevent Phantom Billing

Phantom billing is also fraudulent activity in dental procedures. To curb this issue, dentists should maintain comprehensive patient records. This can be done by using medical record software or a PMS, which can help audit patient records.

Moreover, dental practices should implement a whistleblower policy, enabling staff to report suspicious billing practices anonymously.

8. Implement Robust Billing Policies

Dental practices must develop a clear and comprehensive billing policy manual covering all aspects of dental billing.

They should perform external audits to review billing practices for compliance. This can help them avoid legal issues and minimize the legal penalties.

9. Engage Legal and Billing Experts

To address legal issues, dentists should consult a healthcare attorney specializing in dental practices to ensure billing compliance.

They should stay updated with federal and state billing regulations through professional associations like the ADA.

10. Monitor Staff Practices

Dental practices must maintain a regular monitoring strategy so that their dental assistants and hygienists can adhere to their scope of practice. Lastly, they should review their work to prevent unauthorized procedures, ensuring a transparent and smooth billing process to avoid legal and financial loss.

⚠️ Stay Compliant and Avoid Legal and Financial Penalties!

No more legal notices and financial penalties for your dental office.

BMB offers medical billing consultancy to eliminate financial and legal stress.

Get expert assistance from our professional team to resolve legal issues by adhering to legal compliance and making dental billing smooth and transparent.

We proactively address illegal dental billing practices.

Schedule a Demo or Free Consultation to discuss your practice’s issues and get prompt solutions on a priority basis.


Avoiding fraudulent and illegal dental billing practices is essential for dental practices.

Staying informed, ensuring dental staff’s efficiency and credibility, and implementing robust compliance measures will help dental practices avoid illegal practices and build a reputable practice.

Dentists can minimize the risks of legal and financial penalties by promptly addressing billing issues. As a result, they can ensure error-free claim submission, promising reasonable revenue growth for their dental office.

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