|
Understanding Dental Insurance
Chicago, Illinois
Dental insurance can be hard to understand. People often find that necessary dental treatments are not covered, or not fully covered, and they wonder why. Even people who deal with insurance every day, find it hard to figure out. The short answer is that insurance is a business for profit, and they set up policies and procedures so they always take in more in premiums than they pay out in benefits.
Dental Insurance is no longer insurance
An insurance policy is normally set up to deal with catastrophic events. Policyholders pay premiums with the understanding that if a catastrophic event described by the policy occurs, the insurance company will pay a certain sum, ideally sufficient to cover the expenses incurred by policyholders. These policies are always written with limitations that pretty much guarantee the insurance company takes in more money than it pays out. A good example is hurricane insurance, which a number of people in New Orleans were surprised to find covered wind but not water damage.
Originally dental insurance worked that way. Now it is more appropriately called a Dental Benefit Plan, which is to some extent a good thing. For dental issues, it's best not to wait until you have a "catastrophe" before seeking treatment. The change in dental insurance began in the 1970s. Recognizing the benefit of preventive care, you were allowed to choose any dentist, pay small monthly premiums, and the insurance company ensured profitability by limiting yearly benefits to about $1,000.
However, as the insurance industry has changed, your yearly benefit amount is often still $1,000 (which doesn't go nearly as far) but premiums are much higher and you cannot choose any dentist. Now you must choose from the insurance company’s list.
Increased Complications
Premiums have gone up primarily because insurance companies' administration costs have gone up. Wages for more managers in the larger corporations and especially the huge compensation packages for CEOs, as well as advertising have caused administrative costs to outpace cost of living increases. To minimize premiums for employers, and maximize profits for shareholders, insurance companies have devised an array of plan structures:
- Capitation plans
- Health Management Organizations (HMOs)
- Preferred Provider Organizations (PPOs)
- Dental Referral Organizations (DFOs)
More Restrictions
Restrictions are key to maintaining the profitability of these plan structures. Some restrictions include:
- "Networks" -- in most states it is illegal to restrict your choice of dentist, but insurance companies get around this by having lists of dentists to choose from, where treatment is comparatively inexpensive and making you pay higher rates if you go "outside the network."
- Limited coverage –newer techniques and treatments or superior services which use more advanced technology are often excluded from coverage.
- LEAT clauses – LEAT stands for Least Expensive Alternative Treatment. LEAT clauses allow insurance companies to put an upper limit on what they pay by only paying the least expensive cost for your treatment, even if this treatment involves inferior materials. If you elect to get more than this alternative, you pay the difference. Because of the vagaries of medical coding, the LEAT may not even be adequate for your actual situation.
The benefits you receive from dental "insurance" are based on contracts instead of your treatment needs. In addition to the contract between your employer and the insurance company, there is a contract between the dentist and the company. In exchange for having his or her name included in the "network," he or she agrees to treatment stipulations laid out by the insurance company.
In denying coverage for treatment, insurance companies often claim that your treatment is not necessary or that "the fees are too high," without actually evaluating your condition or the work that was done. We believe that only you can be the judge of what your dental needs are, after being given all the information, rather than a clerk in an insurance office looking at a series of generic treatment codes. We leave it to you to decide whether our services are worth what they cost.
With benefits getting squeezed out because of profits and administrative costs, many employers are beginning to offer direct reimbursement that allows you and your employer to receive the full value of money put in with none of the insurance companies' restrictions. If you would like to talk to your employer about this option, please let us know, and we can provide more detailed information.
If you have more questions about dental insurance, schedule a personal dental consultation with one of our team members at Sugar Fix Dental Loft today.
(773) 883-1818
Contact Us
|
