How Dental Insurance Really Works
DENTAL FEE SCHEDULE - Example of what dental procedures cost in Philadelphia (varies by geographical region)
If you are an individual or sole proprietor, good dental insurance is almost impossible to find. You may think you've found it, but you soon realize it’s not what you bargained for. With dental insurance, it’s common to see many dentists NOT accept any insurance. They are covered at “out of network” benefit levels.
However, when you look at your insurance benefits, the in-network and out of network benefits look exactly the same! Both columns have the same 100%, 80%, and 50% showing for both in & out of network. The “catch” is how the insurance company reimburses dentists and “out of network” dentists.
Let’s imagine you are a dentist. Dental insurance company XYZ comes to you and asks you to be in the network. The catch is that you must accept their reimbursement rates, and they’re terrible! You normally charge $1200 for a crown but insurance company XYZ wants you to do it for $800… or 66% of what your regular fee would be. So you say bugger off! This is why many dentists are “out of network”. This is called a "MAC" Plan (Maximum Allowable Charge).
Let’s look at those out of network benefits again from the perspective of a consumer. The brochure from dental insurance company XYZ says it’ll cover crowns at 50% for both in and out of network. You go get your crown from an out of network dentist. That dentist tells you it’ll be $1200 so you expect to pay $600 since the insurance will cover 50%. Surprise… you get a bill from the dentist for $850.
This happened because insurance company XYZ thinks a crown should cost $800 so they’ll pay 50% of $800, which is $400… minus the $50 deductible. The insurance only paid $350 so you’re left paying the remaining $850.
The term that you want to focus on is the “usual & customary reimbursement" (UCR) rate that the insurance company uses for out of network providers. You want to find a dental insurance with a “usual & customary” reimbursement rate of 80% or higher, preferably 90%. So if a crown costs $1200, the dental insurance company will recognize that and set the out of network reimbursement rate accordingly. Dental insurance with a high "usual & customary" reimbursement rate will make it seem like every dentist is in-network… even when they are out of network.
The dentist will usually say, "We do not accept the insurance and are not responsible for anything your insurance company says! *Disclaimers, more disclaimers, etc.*". They want you to know that you will pay up front, the out of network claim form will be completed, and the reimbursement from the insurance company is not their problem. Most dentists will complete the out of network claim form for you.
What will happen is that you go to the dentist, you pay the full cost of the procedure, and the dentist will complete the out of network claim form and send it to your insurance company. IF you are in a 90% UCR plan, you will receive a check for the proper amount. Which is 100% for cleanings / preventative, 80% for basic procedures, and 50% for larger procedures like crowns. If this does not happen, let us know!
If you are an individual or sole proprietor, good dental insurance is almost impossible to find. You may think you've found it, but you soon realize it’s not what you bargained for. With dental insurance, it’s common to see many dentists NOT accept any insurance. They are covered at “out of network” benefit levels.
However, when you look at your insurance benefits, the in-network and out of network benefits look exactly the same! Both columns have the same 100%, 80%, and 50% showing for both in & out of network. The “catch” is how the insurance company reimburses dentists and “out of network” dentists.
Let’s imagine you are a dentist. Dental insurance company XYZ comes to you and asks you to be in the network. The catch is that you must accept their reimbursement rates, and they’re terrible! You normally charge $1200 for a crown but insurance company XYZ wants you to do it for $800… or 66% of what your regular fee would be. So you say bugger off! This is why many dentists are “out of network”. This is called a "MAC" Plan (Maximum Allowable Charge).
Let’s look at those out of network benefits again from the perspective of a consumer. The brochure from dental insurance company XYZ says it’ll cover crowns at 50% for both in and out of network. You go get your crown from an out of network dentist. That dentist tells you it’ll be $1200 so you expect to pay $600 since the insurance will cover 50%. Surprise… you get a bill from the dentist for $850.
This happened because insurance company XYZ thinks a crown should cost $800 so they’ll pay 50% of $800, which is $400… minus the $50 deductible. The insurance only paid $350 so you’re left paying the remaining $850.
The term that you want to focus on is the “usual & customary reimbursement" (UCR) rate that the insurance company uses for out of network providers. You want to find a dental insurance with a “usual & customary” reimbursement rate of 80% or higher, preferably 90%. So if a crown costs $1200, the dental insurance company will recognize that and set the out of network reimbursement rate accordingly. Dental insurance with a high "usual & customary" reimbursement rate will make it seem like every dentist is in-network… even when they are out of network.
How It Works with Out of Network Dentists and a 90% UCR Plan
The dentist will usually say, "We do not accept the insurance and are not responsible for anything your insurance company says! *Disclaimers, more disclaimers, etc.*". They want you to know that you will pay up front, the out of network claim form will be completed, and the reimbursement from the insurance company is not their problem. Most dentists will complete the out of network claim form for you.
What will happen is that you go to the dentist, you pay the full cost of the procedure, and the dentist will complete the out of network claim form and send it to your insurance company. IF you are in a 90% UCR plan, you will receive a check for the proper amount. Which is 100% for cleanings / preventative, 80% for basic procedures, and 50% for larger procedures like crowns. If this does not happen, let us know!
