Most insurance plans are a gamble. Life, automobile, homeowners’, and disability insurance provide large payoffs on chance claims for comparatively small premiums or bets. Dental insurance is different. People use their dental insurance. Many people see their dentist at least twice a year. People get cavities and need fillings. Dental work requires periodic replacement. Think of dental insurance as a gamble with low odds and rules that benefit the house.
Whenever discussing dental insurance it is important to understand some of the lingo. Dental insurance breaks dental treatment down into four main categories: diagnostic, basic, major and non-covered services. Diagnostic services are best exemplified by the average dental check up. Cleanings, radiographs (x-rays), and examinations fall into this category. Basic services include most single visit fillings, root canal treatment, extractions, gum treatments and denture repairs. Major services include crowns, tooth replacement procedures, and some types of fillings.
Each employer decides what treatment will be covered based on a menu of options provided by the insurance company. These options are called riders. Riders may include treatments such as dental implants, more frequent checkups, dentures, bridgework, and tooth colored fillings for back teeth (silver fillings are considered standard).
Some options may call for insurance to cover the cost of the Least Expensive Acceptable Treatment, which may be referred to as a LEAT benefit. A common LEAT benefit is that many employers choose coverage that pays the silver-filling fee for a tooth colored filling. The employee is required to make up the difference. This is not an example of the insurance company trying to save itself money. This is a choice that the employer makes when purchasing insurance.
The amount the insurance pays may be based on a fee schedule that is different from what your dentist charges. Insurance companies may call their fee schedule UCR (Usual, Customary and Reasonable) implying that they cover normal fees. Insurance companies use different formulas to determine UCR and none of them agree with each other. Another, better, name for this seemingly arbitrary fee schedule is a Table of Allowances. Subscribers are often told that they have 100% coverage only to find that when the bill is higher than the UCR or Table of Allowances they have to make up the difference to the dental office.
Indemnity insurance covers a percentage of the cost of dental treatment at any dental office; there is usually a maximum coverage amount and often a deductible (the amount the patient must pay every year before the insurance will pay anything). This type of insurance usually fully covers most preventive dentistry (100% coverage). Other procedures are usually covered at a lower rate. The maximum amount that this insurance will pay each year is often set by the employer. This is the most expensive type of insurance for employers.
Preferred Provider Organizations (PPO’s) contract with some dentists to provide treatment to patients at a lower fee. Many PPO’s allow their subscribers to see dentists outside their list with less coverage and more out of pocket expense. These plans are very similar to the indemnity plans, but they cost the employer less.
Dental maintenance organizations (DMO’s) have short lists of dentists providing treatment to subscribers in return for a small monthly fee per subscriber from the insurance company. Depending on the level of coverage employees may pay as little as a few dollars a visit for treatment that includes cleanings, radiographs (x-rays) and fillings. The dentist is paid by the monthly fee, and co-payments. Subscribers must choose a primary dentist from a short list or a dentist may be chosen for them. DMO’s do not cover treatment outside the primary dental office unless the primary dentist makes a referral to a specialist. DMO’s are controversial among dentists who feel that DMO’s encourage under treatment of dental disease (such as tooth decay). These plans cost the employer the least of any type of dental insurance.
Discount plans are not insurance at all. These plans charge a very small amount each month to allow access to a list of dentists who provide any treatment at a discounted rate.
Direct Reimbursement (DR) is a cost effective way for employers and employees to fund dental benefits without using an insurance company. Employers may decide on any level of coverage. A plan may cover 75% of a thousand dollars of dental treatment per year costing the employer a maximum of $750.00 per year. Another plan may cover 100% of the first $200.00 of treatment and 80% of the next thousand costing the employer a maximum of one thousand dollars per employee. The employer may set up whatever rules they like for their DR plan. Most DR plans are very simple without lists of non-covered procedures or participating providers. The administrative responsibilities of running a plan like this are limited. Small employers often run this type of program themselves. While all of the plans discussed previously have very high administrative costs DR plans cost very little to run.
Insurance companies offer many products to employers. Employers base their buying decisions on many factors. Employees interested in changing their dental benefits should speak with their employers. For information on DR and other types of dental insurance employers and employees may contact Massachusetts Dental Society Insurance Services at (800) 821-6033, or check out their website: http://www.mdsis.org .
Anyone having a problem with their dental insurance should try to resolve it with the company. In Massachusetts, complaints against insurance companies may be made by calling the Massachusetts Division of Insurance at (617) 521-7777, or on their web site: http://www.state.ma.us/doi. Other states will have their own insurance regulation agencies.
Dr. David Leader has practiced in Malden, Ma. since 1989. He is the Chairman of the Health Advisory Committee of the Lynnfield Schools, a member of the Professional Advisory Committee of Tri-CAP Head Start, a member of the department of General Dentistry Of Tufts Dental School, and is a member of the Massachusetts Dental Society Council on Dental Care and Benefits Programs. Many of his columns are available on the Web http://leaderdmd.dentistryonline.com.