Insurance 101
As we come to the end of the year, many employers offer a cafeteria of benefits for employees to choose from including dental benefits. Unfortunately choosing a plan is not easy as there are many unexplained exclusions that are often overlooked. Hopefully, this article will help our patients understand dental insurance and enable you to make the informed choice based on your personal needs!
There are many dental insurance companies and just a name does not indicate specific coverage such as Delta Dental or Metlife, two major insurance carriers. Within each carrier, there are many plans available for employers to choose from. Unfortunately, your employer must make a choice on how comprehensive a plan they wish to provide their employees in benefits and be economically feasible for their bottom line. There are indemnity type plans that allow you to go wherever you wish, PPO’s (preferred provider organizations which allow you to go in and out of the preferred provider organizations), and DPO or DMO’s (dental maintenance organizations or dental preferred organizations that allow coverage only if listed dentists in the network are used). Indemnity plans are not seen as much now due to cost, and most plans offered are PPOs and DPOs. PPO’s offer more “freedom of choice” (ability to go in and out of the network) and therefore are more expensive than DPO’s which still give you “freedom to choose” within a list.
Once we get past the type of plan, there are other factors that will affect the cost of the plan to the employer and ultimately the type of benefits you receive. There are yearly time limits (the bucket which all dental providers whether they are a general dentist or specialist although orthodontic coverage may have its own limit). Limits are usually January through December, but occasionally it is fiscal (based on company’s choosing). Monetary limits can range as low as $500 and as high as $3500+ per benefit year. As you can guess, the higher the limit, the greater the cost.
Within the plan, there is a breakdown of benefits. The categories of benefits are usually Preventative (cleanings, exams, x-rays), Restorative (fillings, endos, extractions) and Major (crowns, partial dentures, dentures, bridges). These categories offer percentage coverage ranging from 30-100% coverage – whatever the specific plan benefit is. The patient’s share (sometimes referred to as “copay” is the portion that the insurance does not pay. If there was an example of “standard” insurance coverage I see from our patient base, it would be a PPO, $2000 yearly max, with 100% preventative/ 80% restorative/ 50% major coverage. However, times are changing, and we have seen adjustments in coverage unbeknownst to the patients!
Besides yearly maximums, some insurance companies have yearly “deductibles” ranging from $25-100+ on the first procedure the insurance is utilized for the benefit year. Although not seen as much in application to the preventative category, if it exists in a policy, it will normally apply to the restorative or major category. For example, if you have a $50 deductible that has not been satisfied and it is a $300 restoration paid at 80%, the insurance company will pay $240 less $50 or $190. However, we are seeing it applied to XRAYS in the preventative category that use to be shielded from the deductible! One thing to be aware of is if you have not satisfied your deductible near the end of the year, if the work that will kick in the deductible can wait until the near year (perhaps a month or few weeks away), you might want to consider holding off on the work because you could save one deductible. However, this should only be considered if the work is not urgent!
Besides yearly limits, co-pays, and deductibles, there are “frequency” limitations. This is a limit on how often you can have a procedure done. The most familiar to patients is the “cleaning” frequency. It can range from 2 times /year up to 4 times without any time span limitation (it’s possible to have cleanings 2 weeks apart!), but some plans only allow 6 months (to the day)! What has been recently discovered in some plans is the standard time for a crown redo has been increased from 5 to 10 years! This seems unreasonable due to the non-static nature of the environment in the mouth and the factors that can affect the longevity of a crown. Five years is a reasonable life for a crown although many last over 5 years or more. Ten years puts more responsibility on the patient to keep the area of the crown clean to avoid decay, gum issues, clenching resulting in fractures, etc. Bottom line, this frequency limitation is lowering the benefit of your insurance and the insureds may not be aware of it. Another unknown coverage which lowers benefits is “downgrading” a restoration from “composite” (tooth colored) to “amalgam” (silver fillings). Most patients and dentists prefer composite fillings instead of amalgam fillings for cosmetic reasons or avoidance of the controversial mercury issue. However, some insurance companies negate the cosmetic reasons for posterior teeth and will apply amalgam coverage to composite fillings. Composite fillings are a time intensive procedure. This again, lowers your benefits if this downgrading occurs.
There is always a question of implant coverage. More and more insurance policies are covering this benefit, but usually the more comprehensive ones. Early on when implants were “new” to the dental treatment option, I saw an application of benefits by one insurance company that paid for the implant crown using the partial denture benefit of the policy. What this in essence did was lock the entire arch of the patient for 10 years with a single implant crown. For instance, the patient was granted implant coverage in the upper right region of the mouth by allowing payment for an upper partial denture. The next year, the patient needed a crown in the upper left region. That crown was denied due to the frequency limitation of the partial denture! (10 years). Yes, a benefit was received, but did this patient lose more in future negated coverage? Please read your benefit’s explanation of benefits carefully regarding implant coverage. For most policies, implant coverage is not a benefit yet, but in time, it will be a more accepted “normal” procedure in the insurance world but probably at a higher cost to the employer.
A hint for coverage for implants which may not be covered by your insurance policy is possibly a “flexible spending” option offered by your employer. This is employee contributions to a medical/dental account to be used for treatment not paid for by the insurance company. A set amount is taken from your paycheck tax free to be used for out- of -pocket expenses such as copays, non-covered treatment, etc. Another way to look at this benefit is although it is YOUR money, it is more of it to be used for your treatment as it is TAX FREE. How it is set up and reimbursement rules are unique to the employers who offer this option. However, it is usually a “use it or lose it” type scenario which takes planning and estimation on the employee’s part because you have a set time parameter to use the funds or lose the benefits.
One of the least known pitfalls to this insurance quandary is the “if we didn’t pay for the extraction, we won’t pay for the replacement” exclusion! “Pre-existing conditions” is what insurance companies use to deny treatment payment and control costs in payouts. In layman’s terms, it means if you had an extraction done by Insurance company A, Insurance company B may not cover the bridge or partial treatment to replace the extracted tooth! So, in choosing plans, keep in mind if you jump from one carrier to another, look for this exclusion in benefits even though you may feel one carrier offers better coverage. This might need a discussion with the HR department.
Dual coverage (two dental coverages) occurs when someone has two jobs with dental benefits, or both domestic partners’ dental ins. covers the partners. The thought is “two coverages” = 100%. Unfortunately, this is not always the case as there could be a “non-duplication of benefits” clause. This is another cost savings measure by insurance companies which state that if the primary pays as if the secondary were in the primary position, there will be no further payment. That means if Ins A pays $80 of the $100 treatment, and Plan B would have paid $75 of the $100, there is no additional payment of $20. It doesn’t seem equitable and a waste of benefits, but it is legal at least in California if the employer’s headquarters is based outside the state of California. California does not allow California based companies to have non-duplication of benefits clauses. Of course, this is a very specific exclusion and only on occasion have I seen this happen and perhaps this has also changed.
As you can see, understanding your insurance coverage is complex and most insureds don’t take the time to study all caveats of their possible coverage. Unfortunately, the number one attraction is the cost of the product and not the product itself. When patients ask about their insurance benefits, immediately what tells me the scope of benefits is the yearly limit. If you have a $500 yearly or even $1000 yearly limit, you have a very restrictive plan. Dental benefits have maintained costs for the past 50 years (that’s how long Dr. Fong’s practice has existed!) and the increase seen in dental benefits has been quite low in comparison to health care costs! Dental insurance has a yearly limit which naturally contains cost for the insurance companies. There have been many technological advances in dentistry, but it may seem to patients their insurance coverage is insufficient to cover their treatment. Unfortunately, employers must make financial decisions that ultimately affect their employees. Those patients who have employer paid benefits are fortunate to have this benefit. However, for those that do not have this benefit (for example retirees), do not feel you MUST be covered by dental insurance. We have all been conditioned to having an “insurance” safety net for healthcare and rightfully so due to the high cost of an emergency health situation. Buying single payor coverage (private dental insurance) is usually expensive or restrictive because the insurance company knows it will be 100% utilization. We have seen those plans start with cleanings only the first year, and possibly restorations the 2nd year, and major the 3rd year. In addition to paying premiums, there is usually a higher copay for all categories. One suggestion to consider is to be self-funded for your dental needs. If you know what the monthly/yearly premium is for the dental coverage, put that amount into a restricted accountant for dental only. At least you will be using 100% of your funds towards dental instead of paying an insurance company to manage your funds and give you a “benefit” that may be less than what you paid. This, of course, takes discipline! This is an alternative to FSA (flexible spending) if your employer does not offer it. If you wish to consider this option, please call our office and we can give you a history of your dental work for the past few years to see what trend your dental needs are taking and make a comparison of costs. This suggestion is offered as an option to help you be in control of financing your dental needs. There are, however, potential options in your health care policies or even Medicare eventually for dental coverage. These plans are more restrictive in what you get or who you can see for dental benefits, but the object of this article is to educate our patients about insurance coverage. Our practice philosophy is to enable our patients with the ability to make informed choices. Please feel free to call our office or email me if you have any questions! I would be more than happy to look at any of your insurance offerings and explain the benefits to you!
Jan
Business Manager
Office of Dr. Frank Liu and Dr. Steven Fong
510-792-4332