Dental Plans: The 4 Basic Types
“As a child,” the mush-mouthed comic Buddy Hackett used to say, “my family’s menu consisted of two choices: take it or leave it.” If you’ve ever shopped for dental insurance, you know that, fortunately, when it comes to dental coverage, there are many more options available.
To make the choice easier, it helps to compare and contrast the 4 basic types of coverage that are available for dental care. With that in mind, here’s a brief overview:
A dental health maintenance organization or DHMO (a type of “managed care”) is a network made up of highly qualified dentists who provide comprehensive and affordable care for individuals or families. Consumers choose a dentist from the network, and they pay a low monthly premium to receive services at either no cost or a reduced price (some services may require a copayment). The participating dentists receive fixed monthly fees.
DHMOs offer some great benefits. For example, they are normally the least expensive type of dental coverage, and subscribers have no waiting periods, deductibles, calendar year maximums, or claim forms. DHMOs are convenient for people who can’t wait for the waiting period on their indemnity plan or PPO to be satisfied. In addition, participating dentists may refer subscribers to dental specialists, and subscribers can receive a discount for specialty services from participating specialists. (Learn more about DHMOs.)
One of the most popular forms of dental insurance coverage is another type of managed care plan called a preferred provider organization (PPO). In this type of plan, consumers select a dentist from a network of preferred dental providers. The providers agree to provide dental care to members at reduced rates. PPO dental plan participants are assured of the maximum cost of their dental treatment in advance.
With a PPO, participating dentists have agreed to pre-negotiated fees. While the choice of dentists is somewhat limited, some PPO plans do provide the freedom to select an out-of-network dentist. In addition, after PPO members have used their maximum annual benefits, the costs for services still remain at pre-negotiated levels. (Learn more about PPOs.)
If being able to choose from the largest pool of dentists is high on your list of priorities, you may be interested in indemnity plans. Individuals with indemnity insurance are free to visit any dentist, unlike those with managed care plans. Subscribers to this type of coverage, also known as “traditional” insurance, pay their dentist’s bill in full and then submit a claim for reimbursement to the carrier.
If being able to choose from the largest pool of dentists is high on your list of priorities, you may be interested in indemnity plans.
Some key strengths of indemnity dental plans include the fact that indemnity plans typically cover a major part of the patient’s bill, and also that they help consumers plan ahead. Completing a pre-claim before having major services done lets consumers know up front what part of their bill the carrier will cover. (Learn more about indemnity plans.)
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Discount Dental Plans
Finally, while not “insurance,” discount dental plans (DDPs), also known as discount dental cards, are another type of coverage that can help consumers save on dental care costs. DDP members make monthly or annual payments in exchange for unlimited dental care services that are priced based on a discounted fee schedule. Services are provided by dentists who participate in the plan’s dental network.
Discount dental plans provide people who have no dental insurance with a cost-effective alternative. People can also use a DDP for services that are covered by one of the other types of insurance but unavailable due to a waiting period. Consumers can save up to 50% on dental work with a DDP compared to having no dental coverage. Moreover, the monthly or annual payments are usually a fraction of the cost people pay for other types of dental coverage. (Learn more about discount dental plans.)
Do you have questions about your dental insurance options? Learn more with the resources below, or leave a comment in the Reply section.
- Explore your dental coverage options and find answers to other questions about oral care in the Dental Resources section at DentalInsurance.com.
- Download a free dental insurance checklist designed to help you pinpoint the best dental plan for your needs.
- Dig into this infographic to learn more about the basic types of dental coverage available.