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Dental
Insurance, PPO's, HMO's and Dental Plans |
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Dental Insurance vs Dental
Discount Plans
Overview
Considered an attractive benefit by most employees, dental insurance
operates in much the same way as health insurance. In fact,
it can often be purchased in addition to basic medical care,
or it can be purchased as a separate policy from a separate
provider.
Dental coverage, or a dental benefits plan, reimburses the policyholder
for certain dental expenses according to written agreement.
Because most dental diseases are preventable (unlike many medical
diseases, which can be unpredictable and catastrophic), most
dental benefits plans are structured to encourage patients to
obtain the regular, routine care that is vital to prevention
and diagnosis.
This emphasis on prevention is reinforced by most plans, which
require the patient pay a greater portion of the costs for treatment
of dental disease than for preventive procedures. Dental premiums
usually vary from about $10 a month for a single person to $71
for a family.
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This plan is
not available in Florida. If you are a Florida resident
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Making Choices
Some plans allow you to choose your own dentist. Others, in exchange
for lower rates, limit your choice. Although the opportunity to choose
a dentist is only one factor in the decision to choose a plan, it
is a good idea to note the difference between the two alternatives:
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- Open Panel/Freedom
of Choice. Allows covered patients to receive care from
any dentist and allows any dentist to participate. Dentists
may accept or refuse to treat patients enrolled in the plan.
Coverage with this feature allows you to receive full benefits
for treatment provided by any dentist of your choice.
- Closed
Panel. Allows covered patients to receive care only
from dentists who have signed a contract of participation
with the third party. The third party contracts with a certain
percentage of dentists within a particular geographic area,
who in turn offer lower rates to the patient..
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Coverage
To control dental treatment costs, most plans will limit the amount of care
a patient can receive in a given year through a variety of methods. They
may place a dollar " cap" or limit the amount of benefits, or
may restrict the number or type of services that are covered. The exclusion
of certain services or treatments is also a method of reducing costs. Be
sure to investigate exactly what services the plan covers and excludes,
including special administrative services available to both purchasers and
participants.
Major Plan Types
Indemnity Plans
Indemnity plans are traditional fee-for-service based plans. Normally,
the employee pays a monthly premium to the insurance company, which covers
a portion of his or her dental expenses. A high pre-determined deductible
is usually required before the insurer will begin paying for care, though
you usually have the freedom to choose your own dentist. Preventative
service costs are normally covered by the plan, which typically pays 100%
of the preventative costs, 80% for common restorative services and 50%
for major treatments, such as crowns and orthodontics. The remaining costs
are paid by the patient through a variety of fee schedules. Most indemnity
plans limit the annual dollar amount on benefits, however, and may apply
probationary periods on procedures that could last up to a year. The average
monthly cost of an indemnity plan is between $19 and $25.
Dental HMOs
Also known as capitation plans, dental HMOs (DHMOs), are normally characterized
by monthly premiums, free preventative or routine care, small co-payments
for office visits, and selection from an approved network of dentists.
The dentist is paid on a per capita (per head) basis rather than for the
treatment provided. Contracting dentists -- those within the approved
network -- receive a fixed monthly fee per patient regardless of whether
treatment is performed. Patients may be referred to a specialist who also
contracts with the plan, but they must pay in full if they use a dentist
outside of the network. Other characteristics of these plans are possible
initial enrollment fees and annual dollar caps. These plans cost on average
from $6 to $15 monthly.
Preferred Provider Organizations (PPOs)
Preferred Provider Organizations (PPOs) are somewhere between an indemnity
plan and a dental HMO. Within this plan, a defined panel of dentists provide
services at a discounted rate as long as you stay in their network. If
you go outside the approved network of dentists, you will pay higher deductibles
and co-payments. Typically, PPOs have monthly premiums and may have an
annual dollar cap. The average monthly cost is $20.
Discount Dental Plans/Referral Plans
Discount dental plans, or referral plans, are the most widely available
to individuals. Participants of these plans must use a participating dentist,
who has agreed to offer services at a discounted rate. Typically, you
pay an initial enrollment fee as well as a monthly fee to the discount
company through which your discount is secured. The average monthly cost
is $7 to $20. With discount dental plans, there are no deductibles, no
waiting periods and all pre-existing conditions are accepted. There is
no yearly maximum and no limits on the number of visits to your dentist,
orthodontist or other oral specialist. You can generally begin using your
benefits immediately once you receive your membership number. You often
get a better value out of these plans because they often come bundled
with other discounted health benefits (eg. vision, chiropractic and prescription).
Direct Reimbursement Plans
A direct reimbursement plan is a self-funded benefit plan and is not considered
an insurance plan. In most instances, an employer or company sponsor pays
for dental care with its own funds, rather than paying premiums to an
insurance company or third-party administrator. The patient pays the full
amount to the dentist, gets a receipt for the employer, who reimburses
them for part or all of the dental costs, depending upon the patients
specific benefits. Typically, there are no monthly premiums. Cost depends
on the number of employees, and participants have the freedom to choose
any dentist they wish. Benefits are usually capped at $500 to $1,500 annually
and the company may place a limit on how much an employee can spend on
dental care within a given year. Often, though, there is no limit on services
provided. Under this plan, the patient is reimbursed a percent of the
dollar amount spent on dental care, regardless of the treatment category.
While there are several differences between
traditional dental insurance plans and discount dental plans, they can
also be used together in certain situations to maximize savings. If you
are looking for group dental insurance via your business or employer,
you can visit our Group Dental Plans section. If you are an individual
or family looking save money with a discount dental plan, please use our
“Step 1” search to find the plans available in your area.
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