Know Your Dental Insurance Plan

A Insurance Article Contributed by Shobha Cutting

The Need for Dental Insurance

Good dental insurance is necessary for your peace of mind. Medical insurance covers the policyholder from expenses incurred on cost of treatment of serious diseases or accidents, which is necessary. Dental insurance, on the other hand, also covers the cost of dental check ups, cleaning and other preventive procedures. Preventive care is the key to good oral health and must be covered in a good dental insurance plan.

Medical insurance plans are designed primarily to cover costs of diagnosing and treating serious medical diseases involving a primary care physician and probably several specialists, pathological tests, continuing medication and maybe surgical procedures. Dental care, on the other hand, is usually provided by a general practitioner, includes a check up and maybe an x-ray for diagnosing the problem.

Because most dental problems are preventable, dental insurance is plans are designed to also cater to routine dental check ups and other preventive procedures.

Different Dental Insurance Plans

You can choose from an assortment of dental insurance plans and pick the plan suitable for your specific needs. The following are the points of difference between these plans:

Third party responsibility: In insurance plans, there are usually three parties involved, the policyholder/patient, the care-giver or dentist and a third party responsible for processing/settling the claim. There are three types of third parties. They are a Dental service Corporation, who negotiate and administer the dental insurance contracts, the Insurance Carriers, who underwrite the financial risk of, and process payment claims for, dental services.

Carriers contract with individuals or patient groups to offer a variety of dental benefits packages, often including both fee-for-service and managed care plans, and Self-Funded Insurers. These companies use their own funds to underwrite the expense of providing dental care to their employees. The company pays for the dental costs of its employees. The different dental insurance plans may have differing type of third parties involved.

The option of selecting your dentist: The insurance plan could allow the policyholder to choose his/her own dentist or may limit this choice, in exchange for a lower premium. The type of dental insurance plan that does not allow free choice of dentist could either be "Preferred Provider Organization Plan" where the policyholder is allowed to go to any dentist from the panel of dentists of the insurance company.

If a policyholder chooses to get the services of a dentist not in the panel, he/she may have to contribute more as the policyholder's share of the 'free for service'. Or, the dental insurance plan could be "Exclusive Provider Organization" where the policyholder is to receive dental care only from a dentist in the insurance companies panel, with the probable exception an emergency.

Payment to Dentist, in Dental Insurance

Your insurance plan could provide for paying the service provider in any of the following ways:

· Indemnity Plan: This type of plan pays the dentist on a traditional fee-for-service basis. The policyholder pays a fixed ore-determined premium to the insurance company and they, in turn, pay the dentist 50% to 80% of the dentist's fee. The policyholder pays the remaining 20% to 50% of the cost of service. Most indemnity (traditional fee-for-service) plans use the 'Usual, Customary & Reasonable' payment schedule. It allows patients to select their own dentist.

The UCR schedule pays benefits based on a fixed percentage of the lesser of the dentist's fee or the fee determined by the insurance carrier to be "usual", "customary" or "reasonable" for the service in the community in which the service was delivered. The plan may have a deductible, being the amount payable by the policyholder on each claim, in addition to the agreed upon percentage of each claim. There may also be limits to amounts that can be claimed.

· Capitation plan: The dentist is paid on a per capita (per head) basis rather than for actual treatment provided. Participating dentists receive a fixed monthly fee based on the number of patients assigned to the office.

· Direct reimbursement: This is a self-funded plan. The cost of dental treatment is directly reimbursed to the employee, often subject to limits.