Dental insurance is one of the first benefits employers are looking to cut back, according to the Society for Human Resource Management. Approximately $106 billion was spent on dental care in America in 2010. In light of that number, you may be on the market for a solution to help you and your family maintain good oral health at an affordable cost. Here you can find some of the major differences between dental insurance plans and discount options to help you make an informed decision.
Some types of insurance may require an enrollment fee to begin a policy. In addition to this, members must pay a monthly premium, though some dental insurance plans might even require payment for an entire year upfront. Premiums can vary based on
- How liable you are to need dental care and
- How much coverage you want.
If you have a pre-existing condition, the insurance company already expects you to need dental work (and thus reimbursement from them), so your premium will be higher than someone with no history of oral health issues. This also determines what percentage of your treatment the policy will cover. The insurance company essentially takes the risk for your dental health, so they want to be prepared if they need to start paying for your treatment.
Discount plans do not collect premiums. Instead, members are charged a steady monthly or yearly rate regardless of pre-existing conditions. Discount plans can charge such low monthly rates because they are not responsible for reimbursing the patient or the dentist. They simply provide members with access to significant discounts at the dentist office, lowering the patient’s out-of-pocket costs from the start.
Most dental insurance plans require that you wait six months to a year before receiving benefits, though sometimes this is reduced for preventive or diagnostic work. If there was no waiting period, policyholders could sign up for insurance, receive treatment immediately, get financially reimbursed and then cancel shortly thereafter at little expense to themselves. For this reason, dental insurance plans simply don’t allow it. They typically require you to wait until you have paid enough money in premiums to cover any damage that might occur, and this comes in the form of a waiting period.
Most plans allow members to begin using discounts within a few days, because you pay the dentist directly and not the plan provider. Patients can take advantage of the discount on their own without pulling money from the discount plan company.
Payment for service
Most individual dental insurance requires some kind of copay for treatment at the dentist office, which means that you are financially responsible for paying at least a portion of the cost of treatment directly to the dentist at the time of service. Insurance does not reimburse the copay – it is fully out-of-pocket. Reimbursement for further costs usually happen one of two ways:
- The patient pays the dentist in full at the office, then fills out a lot of paperwork to submit a claims form to the dental insurance company. Insurance reimburses the patient for the percentage it has agreed to cover.
- The patient only pays the copayment in the dentist office. The dentist then completes the paperwork and submits the claim to the insurance company for the remainder of the cost.
With these plans, the patient receiving treatment pays a significantly discounted price directly to the dentist at the time of service. It requires no middle-man or lengthy paperwork hassle
. Dentists in the network use:
- a specified fee schedule or
- a pre-arranged discount percentage
Since they are contracted into those prices, they cannot arbitrarily decide whether to offer the discount to members.
The term “full-coverage” dental insurance isn’t fully accurate, because it still doesn’t necessarily mean that you will be reimbursed for every procedure.
- Most insurance companies don’t cover treatment for pre-existing conditions, because it is too costly for them.
- Almost all dental policies include a missing tooth clause, which means that the dental insurance plan is not responsible for the cost of replacing a tooth that was missing prior to signing the agreement.
- Policies rarely include coverage for cosmetic work like veneers or tooth implants, even if a cosmetic procedure becomes necessary for maintaining or restoring the patient’s health.
- Another typical restriction is the replacement clause, which states that a dental insurance plan will not pay to replace dentures or bridges until an allotted time limit has passed.
Members of discount plans have found that they can receive discounts on a wide range of treatment, including mostcosmetic procedures. Some plans discount nearly everything except lab fees. The simple process has few restrictions.
- There is no missing tooth clause.
- Members are not screened for pre-existing conditions.
The discount can be applied at any time regardless of the patient’s oral health status.
Usual, Customary and Reasonable
Insurance companies typically reimburse you for costs they have deemed usual, customary and reasonable (UCR). If the insurance company has decided that a UCR teeth cleaning costs $65 and your dentist charges $80, they will calculate their percentage of reimbursement based on the price they have determined rather than on the price you were actually charged.
Members typically pay a fixed, predetermined price for treatment with a discount plan. In the case of specialist treatments such as orthodontics, often a fixed discount is applied to the provider’s fee, reducing the cost of treatment by up to 20%.
Policyholders typically must reach a deductible before the dental insurance plan will financially contribute anything. For the patient, this means:
- You will receive no reimbursements until you have put a specified amount of money toward your dental treatment out-of-pocket.
- Once you have spent that amount of money to reach your deductible, insurance will begin paying a certain percentage of your bill.
Next year, 12% of employers plan to shift to high-deductible insurance coverage to save money (National Business Group on Health/Towers Watson). This means that as a policyholder of one of these plans, you may be financially responsible for more of your dental bills than you are today.
Most insurance companies set limitations on how much money they will put toward the cost of your treatment. That comes in the form of a yearly maximum, which dictates at what point the insurance company will no longer provide assistance. Once your dental insurance for individuals has contributed a certain amount of money, you are responsible for all treatment costs for the rest of the year. This number usually resets yearly.
Discount plans require no deductible. Members do not have to meet a price quota before they begin receiving discounts, nor do they have to wait for the plan to become effective. This can occur because patients pay the dentist directly at a discounted price without reimbursement.
Members get the discount every time they visit the dentist with no limit regarding usage. Since it has no maximum, some people use this plan after their regular dental insurance planhas reached its yearly limit.
Dental decay is one of the most prominent diseases today, affecting 60 to 90% of teenagers and adults (World Health Organization). Perhaps that’s because last year, 34% of the American population did not visit a dentist at all (Gallup-Healthways poll). Roughly 48% of the US workforce can obtain a dental plan through their employer, although 74% have access to comparable medical-only benefits (U.S. Bureau of Labor Statistics). Those percentages don’t match up, leaving thousands of people in need of an alternative method to pay for dental care. As the cost of dental care goes up, low-cost dental plans become more of a necessity.