Understanding the Initial Fee

Understanding the Initial Fee in a Treatment Contract

The Initial Fee in a Tops Treatment Contract represents the patient's down payment at the beginning of treatment. This amount is charged when the contract is activated, which should coincide with the initial placement of appliances.

The Initial Fee may include:

• Upfront payments made by the patient, including down payments and amounts already collected for services such as records.
• Discounts or courtesies offered by the practice, such as family discounts or other reductions applied to the patient's treatment fee.

The Initial Fee represents the portion of the contract charged at the beginning of treatment, with the remaining balance distributed across future monthly charges.

Initial Fee for Contracts Accepting Insurance (Accept Assignment)

For Treatment Contracts that accept assignment of insurance benefits, the Initial Fee is entered in two columns:

• Amount: A general industry recommendation is 25–35% of the total contract amount, although this may vary depending on the practice's financial policies.
• Copay: Enter the Initial Fee amount that will be charged to the patient.

These amounts may differ depending on the patient's insurance benefits and financial arrangements.

Can the Initial Fee Be Changed?

Once the initial fee has been charged, it cannot be modified, deleted or voided.

If the Initial Fee was entered incorrectly, there are a few options to consider depending on the amount already charged and how the remaining contract charges are scheduled.

Option 1: Allow Patient Payments to Catch Up

If the Initial Fee was too high, consider allowing future patient payments to be applied against the amount already charged and reflected in the patient's Due Now balance.

If possible, adjust the remaining monthly charge schedule so additional charges do not occur until the patient's payments have caught up with the amount already charged.

Option 2: Adjust Future Contract Charges

If the Initial Fee was too low because an amount was omitted, such as a courtesy, you may be able to account for the difference through future contract charges.

For example:

1. Schedule the missing amount to charge the following day.
2. Reduce the final monthly charge by the same amount.
3. Confirm that the overall contract total remains unchanged.

Important: Any adjustments to future charges should maintain the original contract total.

Option 3: Deactivate the Contract and Start Over

If the Initial Fee is significantly incorrect or cannot reasonably be corrected through future charges, it may be best to deactivate the existing contract and create a new one.

1. Deactivate the existing contract. Refer to the articles below for instructions on Deactivating a Contract With Insurance or Deactivating a Contract Without Insurance.
2. Reverse the entire original contract amount. Create a negative (-) account adjustment using (-) Account Adjustment > Data Entry Correction for the full contract amount, not just the Initial Fee or remaining balance.
3. Duplicate the original Treatment Plan in the Clinical portion of the patient's chart.
4. Create, Record and Active a new Treatment Contract using the correct financial information.

Example: If the original contract total was $5,000, with a $1,000 Initial Fee and $4,000 in remaining scheduled charges, the (-) Negative Data Entry Correction adjustment should be $-5,000 reversing the entire original contract amount.

Before activating the new contract, carefully review the Initial Fee, monthly charges, and contract total to ensure all amounts are correct.

Special Consideration: Incorrect Initial Fee on Insurance Claims

If the Initial Fee entered in the  Amount column of a contract accepting insurance assignment is incorrect, and the practice believes the insurance company may not accept the amount reported, consider the following options:

• Submit the claim directly through the insurance payer's portal. Rather than using the claim generated by Tops, enter the correct claim information directly in the payer's portal to ensure accuracy. Make sure to select Edit Claim on the Initial Claim in Tops and make a note of how the claim was filed.
• Deactivate and recreate the Treatment Contract. Follow the steps outlined in Option 3 to create a new contract with the correct Initial Fee.

Important: Be cautious when deactivating and recreating a contract on a different day than the original activation date. The date associated with the procedure code generated in Box 24 of the claim may no longer align with the patient's actual treatment start date.

Review the claim carefully before submission to ensure the information accurately reflects the patient's treatment.

What if the Initial Fee Date is Incorrect?

If the Initial Fee date, rather than the amount, is incorrect, the available options depend on whether the contract was activated too early or too late.

If the contract was activated after the patient started:

This primarily impacts insurance claims. Generally, insurance companies may accept an Initial Fee date that differs by a few days from the patient's actual Treatment Start Date.

The practice has two options:

1. Submit the claim as generated. The practice may choose to submit the claim with the existing Initial Fee date, understanding that acceptance is at the discretion of the insurance payer.
2. Correct the date reported to insurance. Depending on the payer's requirements, the practice may:
   • Submit the claim directly through the payer's portal using the correct date.
   • Modify the claim to reflect the correct Initial Fee date and mail or fax it to the payer.
   • E-file the claim through DentalXChange (DXC) and resubmit a corrected claim through DXC with the payer after the claim has been adjudicated.

If the contract was activated too soon:

If the contract was activated before the patient's actual treatment start, the practice can follow the contract deactivation steps outlined above.

Once the original contract has been deactivated and the appropriate financial corrections completed, the practice can activate a new contract when treatment actually begins.

Important: Before deactivating and recreating a contract, consider how the new activation date may impact the information generated on insurance claims. Always review the claim details for accuracy before submission.

Tops Tip

Always review the Initial Fee before activating a Treatment Contract!

Once charged, the Initial Fee cannot be changed or removed. Taking a moment to verify the amount, including any upfront payments and courtesies, can help prevent the need for additional corrections or contract replacement.