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.
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
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.
Major Plan Types
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.
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
on-going 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.
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.