Understanding Dental Insurance
There are many misconceptions about dental insurance coverage and most stem from the lack of knowledge by the insured regarding their insurance plan.
First the amount of coverage is not determined by what insurance company the policy is through. All insurance companies sell many different polices each with different benefit levels. What determines the policy benefits is the premium that your employer is willing to pay. The greater the policy premiums the greater its benefits.
Dental benefits are broken down into several categories. The first is the annual maximum which under no circumstance will ever be exceeded. For most polices this is between $1000 and $1500 per policy year which is usually the calendar year. So every January first the policy will have a new yearly maximum regardless of what it paid out the previous year. This means that you will always get the maximum benefit every year and it also means that there is no carry over of unused benefits from the year before, therefore use it or lose it on a yearly bases.
The biggest problem with this benefit is that it never changes so that the policy's buying power is eroded away ever year by inflation. When the $1000 per year annual maximum was established back in the late 1960's it was a reasonable benefit level. But by 2004 if this benefit had been adjusted for inflation it would be between $8500 to $12000, based on an average annual inflation rate of 6% over 35 to 38 years.
So the next time your employer or your insurance company tells you that your dental policy is the same as it ever was you will know better. They are cheating you every year the policy's annual maximum is not adjusted for inflation. Also, the next time they tell you your doctor is overcharging and that's why your benefits are depleted so quickly you will know better. In fact according to economic surveys, on a relative dollar amount, dentists make less money today than they did in the 1950's, 60'sand 70's.
The next aspect of dental insurance to understand is the percentage of the treatment's fee that the insurance company claims it will pay. The insurance companies divide dental treatment into three broad categories. They are Preventative, which include examinations, radiographs (x-rays) and cleanings. Basic, which includes direct restorations (fillings), endodontics (root canals) and periodontics (gum treatment) and Major which includes crowns (caps), bridges and dentures.
Within these categories the insurance companies will pay a percentage of a number they make up and euphemistically call Usual Customary and Reasonable or UCR. However the is nothing usual customary or reasonable about there numbers and since they are not required to disclose how they arrive at these numbers no one outside the insurance industry knows what criteria they use to establish them.
So when an insurance company claims that they will pay a specific percentage for a certain procedure this is only true if the doctor's fee is less than or equal to the insurance company's UCR. If the doctor's fee exceeds the insurance company's UCR, which occurs very frequently, then the insurance company's percentage does not apply. Please remember that this is only an example of the most common type of policy and the specifics for any particular police are always different and defined in the terms of the policy.
Another tactic the insurance companies employ is downgrading the treatment code that was submitted by the doctor. Essentially the insurance company is not paying benefits on the treatment you received but on another procedure that they euphemistically call an equivalent alternative treatment that has a lower UCR and therefore a lower insurance benefit. This reduces their expense and passes on that difference to the insured increasing your out of pocket expense.
Insurance companies will also have many procedure codes that they will not pay any benefits on under any circumstances regardless of the patient's need for the treatment or the treatments validity or efficaciousness. Often times the insurance policy will not cover pre existing conditions or treatment codes that are associated with higher fees and reconstruction cases. Everyone needs to consult their specific policy to determine which if any of these restrictions applies to them and their policy.
Once a claim has been filed by a doctor's office the insurance company will often claim they never received it so the can delay making benefit payments for as long as possible. They will also claim that they need additional information from the doctor, patient, employer or all three. Again this is designed to delay payment of benefits. It is advantageous to the insurance company to collect its premiums on time and delay its benefit payments as long as possible. This allows them to hold onto the difference for as long as possible.
All these sited techniques reduces the insurance company's financial liability and allows them to to keep the cost of their polices down so they and your employer, who purchases the polices, can save money and deceive you into thinking that your dental insurance is the still the same as it ever was. Now that you are more informed about your dental insurance you should be able to make a better choice in the type and amount of treatment you receive base on your needs and desires through consultation with your doctor. Your doctor uses your best interest as the bases for treatment recommendations while your insurance company uses its bottom line for the bases if its decisions, since it has to answer to it share holders. Remember its insurance company CEOs who make 50 to 100 million dollars a year not your doctor.