With the difficult economic times we are all going through, it is important to make good financial decisions. How you manage your dental costs and maximize your dental insurance is one of those areas that can really help.  

To minimize your personal out-of-pocket costs, two things are essential.  First, it is important to have regular visits to your dentist. When problems are diagnosed early, the treatment is always less extensive (and expensive) than when the condition has progressed. Second, it is important to have the right insurance for your needs and to use it appropriately.

However, choosing the right insurance and using it appropriately is not always easy.  Today, there are various types of insurance plans to fit a variety of needs.  And within those plans, there are various options that need to be considered.  And knowing how to optimize the benefits of the plan is just as important.  Whether you are considering buying dental insurance through your employer or independently,or optimizing your benefits from your current plan, there are a number of factors to consider and facts to investigate.  

It can seem daunting, but with a little patience and effort, you can easily make the right decisions. In this two part series, we will examine what you need to know.  

In Part 1 (this week), we look at:

• What is Dental Insurance?
• What are the various types of dental insurance plans?
• What is typically covered?
• What are the various options you have to choose from?

In Part 2 (next week), we look at:

• What are the steps you should take to choose the right plan?
• What should you do to make the most out of the benefits?

Here is what you need to know:

What is Dental Insurance?

A dental insurance plan is a contract with a carrier (insurance company) to reimburse you for various dental expenses you may incur over the course of a specified time.  (In some cases, it can be a form of compensation provided by your employer.) The portion of your dental cost that is reimbursed is determined by the contract between you (or your employer) and the insurance company. The higher the premium paid by you (or your employer), the more generous the reimbursement.

A very important factor to remember regarding any dental insurance plan is that dental insurance is not at all similar to medical insurance. The majority of dental insurance plans are designed with the purpose of only covering the basic dental care around $1,000 to $3,000 (about the same amount that they covered  30 years ago) per year, and is not intended to provide comprehensive coverage like that of medical  insurance.

Also, because the costs relating to dental care are generally lower than medical, the way the insurance works is not the same. Dental insurance is designed to cover only a portion of the costs of most procedures. And that amount will vary depending on the plan you have, and the type of benefit options you choose.

(Tip:  Importantly, some procedures performed by your dentist may be covered by your medical insurance, so it is always important to talk with your doctor about your treatment plan to understand the full extent of your insurance coverage.)

What are the various types of dental insurance plans?

The first step in picking the right insurance plan for your needs is to know the types of policies that are available.  There are several major types of dental insurance, including:

1.    Tradition/Indemnity
2.    Discount Dental Plans
3.    Managed Care Dental Insurance which includes:

• Capitation Dental Plan, or Dental HMO (DHMO)
• Preferred Provider Organizational plan or PPO
• Exclusive Provider Organization

Tradition/Indemnity

The goal of traditional or indemnity dental insurance is to prevent poor dental health so the insurance company does not have to pay out large amounts for critical care.  Consequently, the insurance company encourages routine dental maintenance.  Some characteristics of these plans include:

• Amounts Covered—these plans operate on fee for services basis based on the “Usual, Customary and Reasonable” (UCR) fee.  The insurance company will pay based on a scale from 0 -100% of what dentists normally charge (a UCR fee).  Most cover somewhere between 50% - 80%.  The insurance company that uses UCR plans will look at what the UCR fees are (on average in the same geographic area) and what the dentist charges, and then choose the cheaper of the two. If they go with the dentist fees, they will pay in full.  However, if the doctor’s fee is a more than the UCR fee, you may have to make up the difference.
• Procedure Coverage--most companies will pay in full for preventive care, such as yearly exams, teeth cleanings, routine x-rays, sealants for kids under eighteen and fluoride treatments. Payment for other types of dental care may be covered for anywhere from 50% - 80% (depending on the plan).
• Emergency Care--emergency care or out of town problems are not a problem because you are not restricted to just your dentist. You may have to file your own paperwork in some cases though.
• Dentist Selection--traditional/indemnity plans use “open panels”.--which means that you are able to choose a dentist you trust and are comfortable with, rather than having to select a dentist from a list provided by the insurance company.  Also, you do not need referrals or authorization to go to a specialist for the care you need.  (You may need to get pre-approval for certain procedures but it is not nearly as restrictive as dental HMO’s or PPO plans.)
• Deductibles—these plans will vary but may include a deductible amount that is covered by the patient before insurance reimbursements are made.
• Premiums--your premiums for traditional insurance can be slightly higher than some other plans offer but this is not necessarily a bad thing, depending on the freedom you want to make decisions on dentists and procedures.
• Summary—this plan offers very good basic preventative coverage, as well as coverage for a number of additional procedures that make it very attractive for people having several dental issues that they wish to address.  Additionally, it provides the freedom to make choices to fit your needs.

Discount Dental Plans

Discount dental plans—while not technically insurance plans--are one of the newer options available to consumers. Discount dental companies are third party companies that contract with a group of dentists to provide deeply discounted rates for care. You join their dental plan for a monthly fee and they provide you with a dentist that offers you discount rates, often as much as 70% off normal fees.  Some characteristics of these plans include:

• Amounts Covered --there is no reimbursement made to you.  Rather, you receive a pre-negotiated discount from the dentist for a particular service.  The discount may vary by procedure.  It is important to review the level of discount provided by procedure, and consider the best plan based on the various services you and your family may need.
• Procedure Coverage —all procedures are covered, but may have different discount levels.
• Emergency Care--as a rule there are no emergency benefits if you are out of town or away from your dentist.
• Dentist Selection--discount plans use “closed panels."  That simply means the plans have already chosen the dentists they are going to use and you have to choose from their lists. There is no choice on your part if it is not on the list of participating dentists.  And because the dentist agrees to slash prices in exchange for dental patients being referred to him or her, you have to make sure you are getting proper quality dental care.
• Deductibles—these plans do not involve a deductible amount since the patient is simply paying a discounted rate for each service.
• Premiums—the monthly fee to join such plans is usually low, and it is a good solution for people who cannot afford insurance.  However, the plan does not provide the level of coverage for those needing extensive dental work.
• Summary—some of the good points to this type of program are that it can be affordable for families who cannot afford other types of insurance. Also there are generally no clauses for pre-existing dental problems, such as an already missing tooth, everything is taken care of. You pay the dentist a set amount already predetermined. Another benefit is there is no paperwork for you to fill out, as the dentist takes care of it all. There is also no co-payment; no deductible and no annual cap on the amount the company will pay in a calendar year. You get what you need when you need it.

(Tip: Be sure to shop around and check out the dentists used and compare plans. The dentist may have a good reason for being in a plan like this.  For example, he/she could be looking for quick way to increase patients and increase income.  But because they are drastically cutting their fees, beware of the quality of service provided.).

Capitation Dental Plan or Dental HMO (DHMO)

Managed dental care programs are popular due to their low premiums, especially if you have your insurance through your employer. A Capitation Dental Plan or Dental HMO (DHMO) operates a great deal differently than Tradition or Indemnity Insurance.

In a DHMO a dentist or dental clinic contracts with the insurance company to provide services to its clients. The dentist or clinic receives a small monthly fee for each patient, no matter what treatments or services he/she provides. The company then in turn refers patients to the dentist.

Some characteristics of these plans include:

• Amounts Covered-–since the dentist is paid a monthly fee to treat you, there is usually only a small co-pay with each visit.  However, with a fixed fee per patient, the dentist will look to keep costs low and appointment times short, so there is a question about the quality of care provided for more extensive needs.  Patients with extensive needs will find that they have to make numerous repeat visits to the dentist for the procedure due to the short appointments,  Also, referrals are required for any kind of specialist and for certain types of treatments.  
• Procedure Coverage—preventive treatments are almost always paid for 100% with no deductible.  Coverage beyond basic care will vary according to the contract, and may affect your premiums and co-pay amounts.
• Emergency Care--emergency care or out of town emergencies are not necessarily covered because the dentist may not be one the insurance company uses.
• Dentist Selection--DHMO programs typically use “closed panels."--meaning they offer you a list of dentists to choose from that they have chosen. You pick a dentist from the list and go to him/her for all your care.  Some plans do offer you the option of choosing a doctor not on the list, but out of pocket expenses that you pay are going to be considerably higher than if you choose one that is accepted by the DHMO.
• Deductibles—these plans typically do not carry a deductible amount for basic preventative procedures...
• Premiums—DHMO programs usually have lower monthly premiums, because the dentist is paid a fixed cost on a monthly basis, no matter what procedure is performed.  There may be an annual yearly cap on the amount the insurance company will pay so you can expect to pick up anything after that is met.
• Summary—this plan is best suited for patients with few needs except a yearly check-up and cleaning.  For those in company plans with few needs, it does provide the lowest cost solution.  For those with more complex needs, or those who wish a higher standard of care and more convenience, and are willing to pay a higher premium, this plan probably will not satisfy them..

(Tip:  If you decide to go with a DHMO or have no choice because of your employers choice of plans, make sure you thoroughly check out the dentist you choose.)

Preferred Provider Organizational plan or PPO

A Preferred Provider Organizational plan or PPO is similar to a DHMO. PPOs have a network of dentists that work with them. The dentist agrees to discount the fees for services upfront to the insurance company.  The insurance company then refers patients to the dental clinic or individual dentist.  The difference from a DHMO is that the dentists are paid a pre-negotiated fee by procedure, and so they will schedule the patient for as much time as it takes to complete the procedure.  Some characteristics of these plans include:

• Amounts Covered—the insurance companies pre-negotiate fees with the dentists.  The discounted fee is usually lower than the UCR the insurance company would use to calculate payment, and is paid in full by the insurance provider.  Depending on the plan, you may have a co-pay amount.
• Procedure Coverage--most companies will pay in full for preventive care, such as yearly exams, teeth cleanings, routine x-rays, sealants for kids under eighteen and fluoride treatments. Payment for other types of dental care may be covered for anywhere from 50% - 80% (depending on the plan).
• Emergency Care--emergency care or out of town problems may not be covered.
• Dentist Selection—these plans often operate under a closed panel. You have no choice which dentist you want if he is not on their list, if you want the discount payment price. There are a few PPOs who will allow you to choose providers outside their list but the cost will reflect that choice.   (Remember, if you do not see your dentist on the list; ask him/her if he participates as insurance companies pick up new dentists all the time )  You will also need to get pre-approval for certain procedures.
• Deductibles—this type of plan has deductibles, a yearly cap, and can have you sharing a percentage of the fees.
• Premiums--your premiums for insurance can be slightly lower than traditional plans. There is no paperwork for you to file here either.
• Summary—this plan offers very good basic preventative coverage, as well as coverage for a number of additional procedures that make it very attractive for people having several dental issues that they wish to address.  Additionally, the dentists are able to schedule the patients the full time required for a procedure—making it much more convenient for the patient.

Exclusive Provider Organization

An EPO is almost identical to a PPO except you have no option of who you go to at all. You have to go to their provider. Specialized care can be limited in this case. Both PPO and EPO plans may limit the number of times a year you can see your dentist. Many dentists will not even participate in this type of insurance plan.

What is typically covered?

No matter what type of insurance you choose, you will want to read the fine print. Making sure you are covered for what you think you are, or for what your family needs is very important. Paying for insurance that does not meet your needs is ridiculous. And insurance coverage and policies differ from plan to plan, even within the same company.

There are certain things that every policy should cover. Most insurance policies run on a 100/80/50 system. Preventive care is covered at 100%, minimal corrective care is covered at 80%, and major treatments often at 50% of the fee.

Here are the basics your plan should offer:

• Preventive Care (usually at 100%)

o    Initial examination by the dentist – once per dentist
o    Regular office exam or check-up – twice yearly
o    Complete set of dental x-rays – approximately every three years
o    Bite Wing X-rays – these check for cavities – once a year
o    Teeth Cleaning – twice a year (be careful here some policies say specifically every 6 months)
o    Topical Fluoride Treatments – twice yearly
o    Sealants – for children under 18

• Corrective Care (usually covered 70% - 80%)

o    Restorative Care – basic fillings and simple crowns
o    Endodontics – root canals
o    Oral Surgery – basic tooth removal, minor surgery needed for things like removing infection
o    Periodontics – minor care for gum problems
o    Prosthodontics – repair of dentures or bridges – replacing linings, etc

• Major Care (can be covered from 50%- 80% but usually less than 80%)

o    Restorative – gold crowns or individual tooth crowns
o    Oral Surgery – complex – impacted teeth, etc
o    Periodontics – complicated gum diseases, bone care etc
o    Orthodontics – retainers, braces,
o    Dental Implants
o    Prosthodontics – dentures, bridges, partial bridges

Insurance companies will not normally pay for new or experimental procedures. Some treatments require pre-approval and may be limited by the plan you choose.

What are the various options you have to choose from?

You may be able to make choices in your plan in several areas, including:

• Type of Coverage-- According to most dental insurance companies, dental procedures are broken down into three categories—Preventative, Basic or Corrective, and Major (see list above for examples of procedures within each group). Since all dental insurance carriers are different, it is important to clarify which dental procedures fall under each specific category. This is important because some insurance plans don't cover major procedures and others have waiting periods for certain procedures. If you know that you will need major dental work that is not covered by a given plan, you should probably look elsewhere to find one that suits all of your needs.
• Dental Insurance Waiting Periods--A waiting period is the length of time an insurance company will make you wait after you are covered before they will pay for certain procedures. For instance, if you need a crown and the policy has a 12 month or longer waiting period, chances are you could have already paid for your crown while you have been paying your premiums and waiting.
• Missing Tooth Clause and Replacement Period--More than 90 percent of dental insurance policies carry a “missing tooth clause” or a “replacement clause.” Many include at least one of these clauses, but most have both. A missing tooth clause protects the insurance company from paying for the replacement of a tooth that was missing before the policy was in effect. For example, if you lost a tooth before your coverage started and later decided that you would like to have a partial, bridge or implant, the insurance company would not have to pay for that service if they have a missing tooth clause in the plan. A replacement clause is similar except that the insurance company won’t pay to replace procedures such as dentures, partials or bridges until the specified time limit has passed.
• Cosmetic Dentistry and Dental Insurance--Cosmetic dentistry is any type of procedure done for vanity purposes only. For example, teeth whitening is very popular. While the effects are gorgeous, keep in mind that 99.9 percent of dental insurance companies won’t pay for cosmetic dentistry.
• Yearly Maximum--The yearly maximum is the most money that the dental insurance plan will pay within one full year. The yearly maximum will automatically renew every year. If you have unused benefits, these will not roll over. Most dental insurance companies allow an average yearly maximum of $1,000 to $3,000.
• In/Out of Network Dentists--Many dental insurance plans will only pay for your dental services if you go to a contracted and participating In-Network Dentist. Find out if you are required to go to a participating dentist or if you can choose your own. If the plan requires that you see an In-Network Dentist, ask for a list of the dentists in your area with whom they are contracted so you can decide if they have a dentist you would consider seeing.
  
  If you wish to stay with your current dentist, some policies allow you to see an Out-of-Network Dentist, however, the costs covered may be significantly lowered.
• UCR (Usual Customary and Reasonable)--Traditional or Indemnity insurance companies use what is called a Usual, Customary and Reasonable (UCR) fee guide. This means that they set their own price that they will allow for every dental procedure that they cover. This is not based on what a dentist actually charges, but what the dental insurance company wishes to cover. For example, your dentist may charge $78 for a dental cleaning, but your insurance company will only allow $58 because that is the UCR fee that they have set.
  
  If you are on a policy that requires you to go to a participating provider, you should not be charged the difference between these two prices. A contracted dentist generally has an agreement with the insurance company to write off the difference in charges. If the policy allows you to go to a dentist of your choice, check the insurance company’s UCR fee guide against the fees that dentist charges. You may be required to pay the difference out of your pocket.

Next week, we will conclude by looking at the steps you can take to choose the right plan and options for you, as well as what you can do to optimize the benefits you receive.

Until then, here's wishing you and your family the good oral and dental health that you deserve!

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