Unfortunately, having shopped for auto or homeowners insurance doesn’t make you an expert on buying dental insurance. Private dental insurance has some important differences compared to several other common insurance products. This article will help you save money and buy a better plan by:
- Reviewing some of quirks of dental plans and the differences it has from other forms of insurance
- Alerting you to insurance features that can increase your out-of-pocket costs
- Providing a shopping checklist that will help you avoid plans mismatched to your needs
Quirky Features of Dental Insurance
The bottom line is more you understand about dental insurance, the more successful your shopping.
Dental insurance can have some peculiar features. For example, deductibles are not as important in the purchase of dental insurance as it is for other forms of insurance. Many dental plans have deductibles in the range of $50 to $75 per enrollee. Medical insurance and property insurance, in comparison, can have deductibles costing thousands of dollars.
Coinsurance is a common form of out-of-pocket costs among dental plans. Unlike a copayment, which is a fixed dollar amount, a coinsurance fee is a percentage of the service cost that is paid by the consumer. Many consumers are more familiar with the concept of copayments through their experience with medical coverage, where a doctor visit might be accompanied by a $35 patient fee and the remaining cost is paid by an insurance company.
Preferred Provider Organizations (i.e. dental insurance PPOs), which are the most common form of private dental insurance, often charge coinsurance fees (especially for high-expense services such as crowns or root canals). Dental HMOs, in comparison, are more likely to have fixed fee copayments for dental services. For example, a HMO may charge $25 copayment for a white filling while a particular PPO may pay 80 percent of the white filling price, leaving the patient to pay the remaining 20 percent as a coinsurance fee. If the dentist charges $200 for the white filling then the patient with the 20 percent coinsurance payment would pay $40 out of pocket.
Another unusual financial aspect of dental plans is the concept of a “maximum benefit.” A maximum benefit is a cap on how much a dental plan will spend on covered treatments during a year. Maximum benefits often range from $500 to $2,500 or more. Some plans such as the NCD Nationwide 5000 Plan have a maximum benefit of $5,000 annually. The same applies to the Humana Extend 5000. HMO dental plans lack maximum benefits so there is generally no annual limit on covered care delivered by in-network dentists.
The subject of dentists brings up another important dimension of dental insurance: insurance acceptance. Insurance plans don’t fix your teeth, dentists do. Consequently, the network of dentists accepting your insurance is a critical matter for your oral health. A low-priced dental plan can become quite expensive for you if an in-network dentist does poor work that leads to more treatment in the future. This consideration brings dental insurance shopping closer to medical coverage than auto coverage. In auto coverage, consumers often minimize the importance of auto repair network but in medical coverage there is a greater concern regarding doctor choice and hospital access.
The Wrong Plan Choice Can Leave You Paying Much More in Uncovered Care than You Spend on Premiums
Dental care can be very expensive. Treatments such as dental implants can cost over $6,000. The wrong plan choice could leave with thousands of dollars in unpaid bills if you buy a plan that:
- Does not cover the treatments you need (dental plan benefits vary by plan and are not standardized)
- Has a maximum benefit well below the costs of your annual care
- Has poor choices for local dentists leading you to out-of-network care for the quality you require
The Dental Shoppers Checklist
Compare your local dental plan options by asking the following question of each plan:
- Establish your choices: Gather your local dental plan options from one or more online resources
- Focus on insurance acceptance: Eliminate the plan options that are not accepted by your preferred dental practice
- Compare premiums: Evaluate the difference in monthly premiums & exclude the plans outside your budget
- Evaluate breadth of benefits: Compare services are NOT covered among each plan (see each option's Plan Details for more thorough information)
- Don't forget out-of-pocket costs: Compare the copayments & coinsurance fees for the services you are most likely to use (e.g. teeth cleaning, x-rays, fillings)
- What are the out-of-pocket costs for the services that may not be anticipated (tooth extraction, root canal, crown)?
- Know your maximum benefit: Review each plan's annual limit on how much it will pay toward covered dental care and treatments
- Choose the plan that has the lowest combined premiums & out-of-pocket costs for the dentist, service coverage, and spending limits you prefer