Tuesday, May 22, 2018

Dental Insurance Basics

Recently, the dental insurance carrier we've linked to in our sidebar list of Product Links notified us that they're soon discontinuing new sales. Fortunately, we have a backup carrier with similar products, so no big deal. But it reminded me that we haven't talked about how individual dental insurance coverage works. Please keep in mind that this information is fairly generic, you should absolutely see your own plan documentation for specifics.

Dental insurance is a way to transfer some of the risk of tooth-related expenses to an insurance company. Be aware that this is often a dollar-for-dollar transfer, and may actually mean only a discount in actual dental fees.

Dental health often gets short shrift when discussing insurance. I once had a client that died of a toothache, so the subject is more serious than one might at first believe. There are generally two types of individual dental coverage: insurance plans and discount plans.

Full blown dental

Dental insurance plans are available from a number of carriers, all of which have their own plan design, network of providers (if applicable) and pricing strategy. But there are benefits that most (if not all) carriers cover, and we'll consider these.

Benefits tend to fall into one of three broad categories: preventive, basic, and major. Pricing is generally per person, with a maximum family premium.

■ Preventive services
These are generally covered at 100%, and include items such as semi-annual routine exams and cleanings, and fluoride treatments for juveniles. Sometimes, this category of benefits will include periodontal (gum health) exams, as well.

■ Diagnostic and Basic services
These services are often subject to a deductible, and are more intrusive than preventive care items. Fillings are generally considered in this category; one new technique is called "composite," which replaces older-fashioned metallic fillings with ones that more closely match actual tooth material and color.

X-rays are also often assigned to this category. Many practices have moved to digital versions of these cameras, meaning that results are available instantly.

Simple extractions can also fall under this definition of covered services.

■ Major services
In addition to a deductible, this level of services is usually subject to co-insurance (often 50%), which requires the patient to more directly share in the cost of care. Root canals are found in this category, as are dentures and crowns. Today, the latter may be fabricated in the dentist's office for immediate installation.

Onlays and space mantainers, surgical extractions and other dental surgeries would also fit in this category and are usually subject to an annual maximum benefit amount. They almost always require one to be insured for at least a year before these benefits are even available.

Discounts ahead

As one might imagine, dental plans such as those described above can be expensive, and may be off-putting to budget-conscious consumers who nonetheless acknowledge the value and importance of dental health. A dental discount plan may be the ideal product for people in that situation.

■ How they work
Dental discount plans generally have no waiting periods, deductibles or annual maximums. They are simple to understand because they're not truly insurance products, but offer access to dental care providers at a reduced cost.

Typically, one pays a fee for access to a network of dentists and other dental-related providers willing to provide service at a reduced rate. These services can range from simple cleanings to gum surgery and dentures. One thing to keep in mind is that, unlike a traditional dental plan, payment for services rendered is due at the time of the visit; there is generally no bill-me-later option (although payment plans may be available for major benefits).

One More Thing

Most of these plans don't cover orthodontia, but one may be able to use a Health Savings Account for those services. That means Uncle Sam is helping to pay for your son's or daughter's braces, which helps reduce your net cost.

Dental insurance isn't for everyone, but it can be a cost-effective way to shift at least some of the dental health burden to a third party. It's important to know, however, exactly what's covered, and at what level. Discount plans, while less comprehensive, may offer a value in reducing net out-of-pocket dental expenses.
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