Most dental insurance is provided by an employer who contracts with an insurance company. There are two types, Managed Care and Fee for Service (traditional insurance).

With Managed Care the insurance company contracts with dentists to discount their fees. Insurance companies have a limited number of dentists to choose from. The practices, willing to participate, lack the patients to keep busy. When this is the case, they welcome discounted-fee-patients. Managed care works well when there is an oversupply of dentists, a number of new dentists starting practices or a large employer in a small town.

There are two kinds of Managed Care: a DHMO (Dental Health Maintenance Organization) and a PPO (Preferred Provider Organization). With a DHMO the dentist receives a monthly fee per individual or family. Certain procedures like cleanings and x-rays are at no cost to the patient and others like crowns are discounted. This may sound good in theory but encounters several flaws in reality. Financial reward to the dental practice is greater for under treatment or over treatment. There is little incentive to notify patients for checkups because the dentist makes more money if patients “don’t come in.” There is a tendency to skip preventative procedures in exchange for more costly restorative options. For instance if fillings are free and crowns are not, there is incentive to recommend a crown. The insurance company discourages referrals to specialists and there are a limited number who can be referred to.

In a PPO, the “participating” dentists discount their fees by about 20%. This saves the patient, employer and insurance company money in the short term. The average profit for a procedure in a dental office is about 30%, so the dentist has to produce three times as much treatment to make the same amount of money with a 20% fee reduction. Many practices will hire new dentists and pay them less, or charge non-PPO patients an inflated fee to compensate for this 20% loss. The patient with PPO coverage is free to see a “nonparticipating dentist” of their choice.

Fee for Service or Traditional dental insurance offers more freedom of choice. The insurance company pays a percentage of the dental fee. Dental insurance is unlike medical insurance in that it only helps pay a portion of care and limits the amount of care. Insurance companies pay a portion by setting a (UCR) usual, customary, and reasonable fee for different procedures. This is an arbitrary amount that varies with different insurance companies and most often is less than the actual fee for a procedure. They also pay only a percentage of the UCR instead of the actual fee. This percentage is usually 50% to 80% or less. The remainder is the patients’ co-pay.

Insurance companies limit care in several ways. The yearly allowable maximum payout by an insurance company is usually a $1000 per individual. This yearly maximum has been the same since 1969 when it would pay for 10 crowns but today would only cover about 1 crown. Insurance companies also exclude certain procedures from coverage using pre-existing conditions, missing tooth exclusions, age restrictions for preventive care and the (LEAT) least expensive alternative treatment.

Delmarva Dental Services has 2700+ dental plans in our computer. We are nonparticipating in PPO plans. The patient pays the amount not estimated to be covered by their insurance at the time of service. Our office submits claims (as a courtesy) to the insurance company. If the patient should receive payment from the insurance company, then it’s the patient’s responsibility to endorse the back of the check and see that we receive it as payment on the account.

Insurance coverage can be very confusing if not frustrating. Our insurance administrator will strive to help you receive the maximum benefits from your policy and answer any questions you may have.