Retroactive termination of insurance

Occurs when an insurance policy is canceled or discontinued with an effective date in the past, meaning the coverage is nullified back to a prior date rather than the date of actual termination. Retroactive termination can result in denied claims for services rendered after the retroactive termination date.

Non-Payment of Premiums –

If policyholders fail to pay their premiums on time, insurers may cancel the policy retroactively to the last paid-through date.

1. Loss of Employment : If an employer no longer employs an insured individual, they are responsible for terminating the employee’s insurance coverage. The timing of when an employer notifies the insurance company of an employee’s termination is beyond the control of any dental office. Industry standards allow employers to report terminations on or before the 20th of each month or within 30 days of the employee’s termination to ensure timely removal from the policy. Due to this extended timeframe, there may be a delay in the insurance system reflecting the change, potentially affecting coverage status. This process is solely managed by the employer and the insurance company, and dental practices have no influence over it. Additionally, former employees have 60 days from the date of the COBRA notice to elect continuation coverage.

• Loss of Eligibility : the insurer may retroactively terminate coverage in case of
• Aging out of a dependent plan – like students over 26 years
• Divorce affecting spousal coverage
• Fraud or Misrepresentation—If the insurer discovers fraud or misrepresentation on the application (e.g., incorrect information about income, employment, or medical history), it may cancel the policy retroactively.
• Employers may mistakenly continue coverage for an ineligible employee and later request a retroactive termination upon realizing the error.

• Government Program Adjustments :  Medicaid and other government programs (Denti-Cal) may retroactively terminate coverage if they determine ineligibility due to income changes or administrative reviews.
  

  Impact of Retroactive Termination

• Denied Claims – Any dental services provided after the termination date will be rejected, requiring dental practices to inform patients of their financial responsibility to pay the claim in whole or provide updated insurance information for processing. Unfortunately, providers often face challenges in billing patients directly in such cases.
  

  Can Dental offices avoid such situations?

  Dental offices can take proactive steps to minimize the risk of retroactive terminations and avoid financial losses by:

• Verify Insurance Eligibility Before Every Visit to confirm

• Active status.
• Future termination dates on file.
• Any plan changes directly with the insurer.
• Ask patients if they have had recent job changes or updates to their insurance.
• Encourage patients to provide alternative insurance if they suspect a policy change.
• Educate patients that coverage can be terminated retroactively due to employer changes, non-payment of premiums, or eligibility issues.
• Request that patients inform the office of any employment or insurance changes before their appointment.
• Ensure that the dental office’s financial responsibility agreement states that the patient’s guarantor will be responsible for payment if their insurance is retroactively terminated.
• Implement a protocol to immediately follow up on unpaid claims to minimize delays in collecting payments.

To safeguard your practice from claim denials caused by retroactive terminations, partnering with a trusted dental insurance verification service in Florida is essential. BEANbite, recognized as a top insurance verification company in Florida, ensures real-time eligibility checks, minimizing financial risks for dental practices. Our expertise extends beyond Florida, making us one of the best dental insurance verification companies in California as well. With our seamless verification process, we help practices stay ahead of insurance changes, reduce administrative burdens, and maintain steady revenue flow. Contact BEANbite today to ensure hassle-free insurance verification and protect your practice from unexpected coverage issues!