FYI #1: Dental Insurance Options

I plan to post some info on subjects usually not covered in dental schools. I know you are all busy studying and trying to pass the boards, but who knows how long I will last here. This way you can search the site when you are ready to read and absorb the material. Now to make my attorney happy:

You are free to use this material as you wish. If you distribute it, please keep this header and credit me "thisisit" of http://forums.studentdoctor.net and the dentaltown forum (http://www.dentaltown.com/home.asp). You are not allowed to alter this in any form or fashion. You read this at your own risk and I cannot be held responsible for any harm you may cause to your business or patients. I am not responsible for typos, mistakes, or misunderstandings. You are responsible for your actions. This material is for personal use and may not be used for any commercial use. Send all comments, complaints, suggestions, or inquiries to [email protected].
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Every dentist in the U.S. needs to deal with 3rd party payers. These are usually insurance companies but can include the government, private corporations, unions, etc. There are some dentists that do not accept insurances, and I envy them. They make the patient pay upfront and then have them get reimbursed by their insurance company. The advantages are that you never wait for your money. It's like going to the grocery store. You fill your cart with groceries and when you pay for them, you will take them home. In the perfect world, all dentists should get paid this way. Guess what? We live in less than a perfect world and to be able to be competitive, we as dentists have to "accept assignment" .

What this means is that when you perform a procedure, the patient pays their portion (hopefully), and then you file a claim with their insurance company. It will take 7-30 days for them to process it and send you a check. Most dentists I know do accept assignment. So unless you are one of the fortunate ones that will refuse to accept assignment, you need to read on.

There are 5 different kinds of 3rd party payers (if I missed one please let me know):

1- The most common one is referred to as regular, indemnity, fee for service, etc. It can be called different names in different places. The most important thing you should know about this is that you will get paid your FULL FEE for every procedure. This is what most dentists like and gladly accept. Here is how it works:

-It is usually offered through someone's employment and the insured can see any dentist or specialist.

-The insured and his/her covered dependents will have a yearly deductible (usually anywhere from $0-$100 per person and capped at some point if the family is more than 3).

-Usually the cleanings, exams and radiographs are called preventative work and are exempt from the deductible (I have seen some cheap employers to start charging deductibles to bring down their premiums, but it is rare).

-The insured usually has a yearly maximum of $500-$2500 per year (no-maximum plans do exist but are very rare). This means that once the insurance company has paid as much as the yearly maximum, the insured is no longer covered. He will have to pay out of pocket or has to wait until next year.

-Most of these plans have something called a breakdown of benefits. It means that the insurance company has categorized all dental work into 3 different categories.

Preventative is usually covered at 100% with no deductibles and includes all exams, cleanings, radiographs and sealants.

Basic coverage is usually covered at 80%; you pay your deductible first, and includes restorative work (fillings), all non-surgical periodontal work, endodontic work, non-surgical extractions, and pedo crowns.

Major work is covered at 50%, you pay your deductible first, and includes all crown and bridgework, dentures and partials, and all surgical work.

The problem is that each insurance company sets their own rules. I imagine that an employer is presented with a comprehensive plan to cover all employees. Then the employer asks how they can reduce the premium and the insurance company customizes it for them. So it is quite normal to change around all the above categories. For example I have seen some insurance companies consider endo and perio part of major work. Also, the percentage I mentioned above can also be altered. Some unions pay 90% of everything and some small businesses pay 50% on everything. My point is that you have to call each and every one of the insurance companies to get the "break-down of benefits".

You should also know that these plans might have some restrictions. Most of the times, the insurance companies will not offer this information. You have to ask them. These can be a waiting period of 12-24 months for any major work, restrictions on coordination of benefit with the patients other insurance (secondary insurance), requiring radiographs, periodontal charting or other information before processing claims, or any other little thing the had added to save the employer money. In our office we have designed a one-page insurance coverage sheet and it gets filled out for every patient. Also, you can?t charge $10,000 for a crown and expect them to pay $5000. They have a database of ?Usual and Customary? fees for your area. If you charge more than that, they will only pay 50% of what they think it?s usual and customary for that procedure in your area. Now an example with the above breakdown:

Prophy $65----Patient pays $0, the insurance pays $65

2 surface composite $120------ patient pays the $50 deductible (once a year), and then 20% of the remaining $70, which is $14 for a total of $64. The insurance company pays the remaining $56. Now if the patient had satisfied his deductible previously, the patient pays $24 and the insurance company pays $96.

Crown $800-----Patient pays 400 and the insurance pays $400 as long as the deductible has been met. Lets say that this patient has had some previous work done and his insurance has paid $700 out of his $1000 maximum. Now instead of paying $400, the insurance company pays $300 and sends you a note saying the maximum yearly has been reached. The patient pays the $400 plus the extra $100.

2-The second type of insurance coverage is the Preferred Provider Organization (PPO). This is very similar to the indemnity plan. The percentage of coverage, maximum yearly, and restriction concepts are all the same. The difference is that the employee has a choice of going to a contracted dentist or any other dentist. By going to a contracted dentist, the employee saves15-25%. The PPO dentists have signed a contract to charge based on a pre-set fee schedule. For example, if my fee for a crown is $800, I agree to get paid only $600. The insurance pays $300 and the patient pays $300. If the patient decides to go to a non-PPO dentist, he/she has to pay the difference. The insurance company pays the same$300 and the patient pays $500. The PPO dentist is promised more patients by adding his name to the PPO?s provider booklet, magazine, Web site, etc. Other than the reduced fee, everything else is the same as an indemnity plan.

3-Government assisted plans are not very popular with dentists. They patient rarely pay anything and the government pays based on a fee schedule. They will not cover many dental procedures and cover only basic procedures. Their fee schedule is also quite lower than what many dentists charge and it usually takes a lot longer for them to process their claims. Dentists usually rely on increased volume of patients to make up for the lower fees. The patient can only see the dentists that accept these plans.

Go to part 2

I plan to post some info on subjects usually not covered in dental schools. I know you are all busy studying and trying to pass the boards, but who knows how long I will last here. This way you can search the site when you are ready to read and absorb the material. Now to make my attorney happy:

You are free to use this material as you wish. If you distribute it, please keep this header and credit me "thisisit" of forums.studentdoctor.net and the dentaltown forum (http://www.dentaltown.com/home.asp). You are not allowed to alter this in any form or fashion. You read this at your own risk and I cannot be held responsible for any harm you may cause to your business or patients. I am not responsible for typos, mistakes, or misunderstandings. You are responsible for your actions. This material is for personal use and may not be used for any commercial use. Send all comments, complaints, suggestions, or inquiries to [email protected].
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Part 2



4- HMO?s (capitation plans) in dentistry are still popular but not for long due to the shortage of dentists in many parts of the country. The patient can only go to a participating dentist or specialist. Any specialty work usually requires a referral and a preauthorization. The dentist gets a small monthly fee ($3-$15) for every patient that signs up with his office. This is called a capitation check. The amount is not related to how many patients are seen or what procedures are performed. It solely depends on how many patients sign up with your office. So if plan X pays $5 a month for every patient and you have 500 patients on the list they send you every month, you get a $2500 check every month. Each procedure also has a fee that is called the ?co-payment? for that procedure, which is paid by the patient at the time of the procedure. Most preventative procedures have no co-payments and other procedures have co-payments of 20-40% of your regular fees. There are HMOs that have co-payments of even lower rates but they are not very popular. The HMO does not send you any money for any specific procedures. There are no claims to file and the capitation check is the only compensation you receive. You are supposed to ?manage? the care of your patients with just that amount. For example, if you do a cleaning, the patient has no co-payment. There are no claims to be filled either, so the HMO does not pay you. In this case, your only compensation is the capitation check. Lets say that you charge $65 for each cleaning and 60 (3 a day on a 20 day a month schedule) of those 500 patients come in for a cleaning. (Note that I am not calculating any exams, radiographs, or any other procedures). That adds up to $3900 while your capitation check was only $2500! We have not calculated the money lost by doing crowns and fillings at an 80% reduction rate. It can bankrupt a dentist in a year. So why so many dentists take it? They became popular in the 80s when there was too many dentists in most metropolitan areas and the whole idea of HMOs were sweeping the nation to help bring down the high cost of medical care. In my opinion, this kind of compensation structure can lead to of sub-standard care. There are many dentists that deliver quality care to their HMO patients but there just as many that are tempted not to do the right thing due to enormous financial loss they may suffer. To survive and be profitable in a dental HMO practice, you have to have a large number of patients registering in your office but a small number of them receiving care. That is everything dentistry DOES NOT stand for. We have worked hard to achieve optimal oral health for our patients by promoting preventative care and regular checkups. This contradicts the HMO strategy. They will argue that if you take care of all the problems of your patients in the first 2 years, then you will only see them for preventative care and nothing else. This may hold true in a medical setting, but not in a dental setting. The usually high overhead of a dental practice will not allow for such a concept. Just review the ?prophy? example above.

5- The discount cards are a recent addition to the mix. Theses companies are not insurance companies and do not claim to be. They are quite simple and can be beneficial to add to your patient base. They target the public by sending them enrollment forms in their credit card, cable, or utility bills. They also have radio, television, and newspaper ads. I have also seen them bundled up with an individual medical plan or supplemental Medicaid plan. Once the patient enrolls and pays the $10-$15 a month fee, they will receive a list of dentists that would give them a discount. There are some plans that offer a percentage off and there are some that have a customized fee schedule. They sign a contract with the dentist to honor the discount or the fee schedule. For example, a crown that may have cost $800, now it is only $600. The patient pays for the whole $600. No claims to file and no waiting to get paid. These plans are usually helpful for people with no other dental insurance. The only problem is that some of these plans discount our fees considerably and may not be worth signing up with. So review the fee schedule carefully!

The first dentist I worked for took everything under the sun. On HMO patients he recommended that you do the least and whenever possible refer to a specialist. I didn't much care for his unethical ways and shortly left after I joined him.

very informative. great stuff. keep posting. 😛

Originally posted by dudelove
The first dentist I worked for took everything under the sun. On HMO patients he recommended that you do the least and whenever possible refer to a specialist. I didn't much care for his unethical ways and shortly left after I joined him.

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I don't want to turn this into a good plan/bad plan debate between dentists but I have to tell you that there are ways you can make money with HMOs and deliver quality care. I do everyday. I still have major issues with the way most HMOs are run, especially those in CA, but we treat everyone the same in our office. HMO patients, regular insurance, patients, and members of my own family get the same treatment.

But this thread is not to tell you what to accept or not to accept. Just some info students may find useful. 😎

Okay, so you envy the dentists that make the patient assume the assignment of benefits. My question to you is, what type of practice can "get away with this".

Growing up I worked in a Pedo office that is run like most, the DDS assumes the assignment of benefits and it runs as you described above. It's funny, I always just assumed all dentists did this, I was surprised to hear some make patients pay 100% up front. I sort of feel like it's in the scope of our job to provide that service for the patient. Especially when a lot of times the insurance companies must be contacted. Patients won't know the difference between txs, materials etc so how can they possibly ever argue a fee reimbursement.

So I guess these are my questions:

1. What type of practice can get away with giving the assignment of benefits to the patient? Does it have to be in a wealthy area? Is is a roadblock towards practice growth if people are turned off by it? If you were me (2nd year student), when you left school how would you run your practice in 20/20 hindsight.

2. What are your thoughts regarding what I touched on above, about it being a service that a dentist should provide in the scope of his treatment.


Thank you in advance for your feedback.

DcS, the comment about me envying those practices was meant as in tongue-in-cheek! I don't believe anyone should do this. The reason? Most dentists don't. If you want to be competitive, you need to gauge the marketplace. You may have a few patients not minding it. But most will object and leave your practice.

I know of one endo practice that does that. The rest are just an urban legend

At the time that my family was being treated by our previous dentist, he did not deal with insurance companies. I had no problems working within such a system. My wife and I both had ( and still have) indemity dental insurance with decent caps and coordination of benefits which provides almost 100% coverage for our family. Large sums in each of our cap accounts are usually left untapped at the end of each benefit year. I think my five kids only approached their cap limits when they each had their wisdom teeth extracted. We eventually sought treatment from another dentist because we became uncomfortable with constant questions about our attitude towards replacing our amalgams with gold, adult orthodontia, cosmetic dentistry etc. We also came to feel a bit uneasy about that dentist's clinical abilities because he was big on referrals and emphasized that he saw his function as being more of a patient manager rather than a clinician.

groundhog are you a dentist or a dental student? Please update your sig so we can see who is talking.

I wouldn't change dentists because he uses specialists. I know it's a bit inconvenient but if he can't do a good job on that endo on #15 (upper left 2nd molar), he is decent enough to sent you to someone he can. The alternative is less than perfect endo and possible tooth loss. I know many dentists shy away from referring out specialty work due to the risk of losing the patient. These dentists get themselves in trouble all the time. The #1 cause of malpractice suit for dentists in the US is the failure to diagnose periodontal disease and a timely referral. The judge won't buy the argument that " we thought the patient wouldn't go or would not like it" unless you have it documented that he refused the referral; signed by the patient (that's what we do).

As I said before I follow the KISS (keep it simple stup!d) rule. I don't do anything if I can't get it as good or better than a specialist. I know I can't see the pulp chamber in tooth #15 so why risk a bad experience for a few hundred dollars. Refer it out. Difficult extractions for $150? No thanks. Let the oral surgeon do it and take care of any complications. I have seen too many endo, ortho, difficult extractions, and surgical perio cases butchered by general dentists to do the same. I know many GPs do quality work in these cases but it's good to know your limits. For the past 18 months I have been doing most of my own endos after I took some courses by Dentsply for their GT Prosystem rotary file and obturation system. I love it. My results are far better than some (I said some) coming back from the endodontist. But am I going to stop referring to them? H*ll no. A calcified curved canal still walks right out of my office. KNOW YOUR LIMITS!

Also, I tell my patients that the average life of a filling is 3-7 years. If your dentist is recommending replacing your fillings, ask him why? If they are defective, go for it. I use an intra-oral camera to show how the margins of a filling are broken; effectively breaking the seal between the outside world and the inside of your tooth. I also explain that if left untreated it can cause a lot more harm. Now if you decide to take your chances, that's your choice. The number one reason you should pick a dentist is that you trust him. If there is no trust, you should change dentists. It seems like that trust was never established; hence, you did not follow his advice.

Thisit,
I'm a regular dental patient going on nearly 60 years now. I'm also the parent and parent in-law of two dental students. The latter info is why I got interested in dentistry and found this fourm on the internet.
And you are right. Trust is important in a health care provider/patient relationship. I have no problems with referrals. Our present dentist has referred me out for root canals, and also our kids for wisdom teeth extractions etc. The thing that I like about our present dentist is that he has never presumed that I needed to be appraoched and educated about what some might view as optional but not necessary dental procedures such as cosmetic dentistry. I get the feeling that he trusts that I will be the first to approach him with such matters if I have any leanings to go in that direction. He tells me what is going wrong with my dental situation, what he believes needs to be done to correct the problems with options, and then leaves the choices up to me. I appreciate that approach vs one of a more patronizing nature. I'm an adult and strive to keep myself somewhat educated which could be attested to by the fact that I sought out and got involved with this forum as nothing more than an amatuer.

By the way, I really appreciate the input of the practicing professionals like yourself, Dr Jeff. I've learned a lot from you two and try to pass it on the two dental students in my life. Thank you.

What you said is something every future dentist should read and appreciate. There are so many "marketing" courses out there for dentists that makes my head spin. You have consultants making $350/hr teaching what any human being should know. It's all common sense, people.

I attended this lecture with my staff about how to make your office more efficient. It turned out that it was one big infomercial for this lady's consulting firm. She suggested that we personally (the dentist) call a NEW patient the night before his appointment welcoming him to our office and ask what we could do to make them more comfortable. Another brilliant idea nowadays is to change your office into a SPA experience. Aromatic stuff, serving tea and wine, foot message, etc. I know that it work s for some and I'm not judging here. But to me, it's a bit too pushy and appear desperate.

Your previous dentist may have been practicing his "sales" techniques picked up at a weekend seminar at Holiday Inn. 😉

As one famous poet said, I only "chill (in) at the Holiday Inn" .

Originally posted by thisisit
What you said is something every future dentist should read and appreciate. There are so many "marketing" courses out there for dentists that makes my head spin. You have consultants making $350/hr teaching what any human being should know. It's all common sense, people.

I attended this lecture with my staff about how to make your office more efficient. It turned out that it was one big infomercial for this lady's consulting firm.

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Dental consultants tend to be like many continuing education speakers in that respect. About 2 months ago I went down to Clearwater, Florida to hear Dr. Bill Strupp speak during a 1 day course. He started off by saying "I'm going to give you the quivalent of a three day course in 1 day, because the standard three day course consists of the morning of the 1st day the lecturer telling you how great they are, that afternoon they'll tell you what they're going to tell you when they finally start talking. Day 2, reiterate how great they are, then tell you what they plan on telling you the rest of the morning. Day 2 afternoon tell you how great the next lecture in this series will be. Day 3(which is only a 1/2 day normally), once again tell you how great they are, and then sell the next 3 day course again!"

Most of the stuff you need to know for marketing is plain old common sense, and thenonce you have the new patient in the chair, be yourself, TALK and LISTEN to them, and then just treat them like you'd want to be treated if it were you sitting in the chair.

BTW, at some point in your on going education process throughout your career, consider going to Florida and hearing Bill Strupp talk, hands down the least BS, here's some great tidbits, thought provoking C.E. speaker I've heard (and last time I looked I have a little over 1250 hours of C.E. 😴 😕 ) so I've heard quite a few folks exhibit "diarrhea of the mouth"😀