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Choosing the Right Dental Plan for your Business

Dental insurance isn't a set topic. There are different plans, and then variations within those plans. The most expensive plans are direct reimbursement plans. Direct reimbursement plans operate by paying for dental coverage with a lot of money that the company sets aside specifically for this purpose. This self-funded plans strength lies in its straightforwardness, as employees are reimbursed according to a simple formula that does away with the complexity of deductibles and the like. But although this is the type of plan that the American Dental Association recommends, directly covering the cost of dental care can be cost-prohibitive for small businesses.

There are less expensive indemnity plans. Plans such as these may be more pheasible for businesses. Premiums are paid to an insurance company, then the insurance providers pay dentists for the treatments they provide. This self-funded plans power lies in its directness. Employees are reimbursed according to a simple formula that does away with the complexity of deductibles and the like. Premiums are set for the year with indemnity plans so as a business your costs are realized. But the costs are a little less up front for your employees.

Insurance companies generally use UCR (usual, customary and reasonable) rates to base their reimbursements to dentists. If the UCR rates used to pay dentists are less than the dentist's rate, the patient may potentially have to pay to make up the difference. Patients also need to pay a deductible, averaging $50, and then a portion of the remaining amount. This is known as a co-payment. An average plan covers 100% for preventive measures like cleanings, 80% for basic work like a crown or cap, and 50% for major procedures like oral surgery.

The least expensive are managed care plans. Like a medical HMO, managed care dental plans require that patients choose from a pool of dentists and pay a co-payment for treatment. But, unlike the fee-for-service plans above, managed care plans do have cost-control measures and can be a little more affordable for small businesses. The co-payment amount can vary according to procedure, though. While preventive procedures usually are performed without a co-payment, more advanced procedures will have higher co-payments.

There are two types of managed care programs: PPO, Preferred Provider Organization programs consist of a network of dentists, the dentists within the network have discounted their fees in order to participate in the plan (employees have to pick from this pool, or pay penalties - a higher deductible or co-payment) to go to the dentist not in the network, and DHMO, Dental Health Maintenance Organization plans work like PPO plans, where patients choose from a network of dentists.

Instead of just discounting their fees, dentists will perform specific treatments for free. Dentists are paid a fixed fee per individual, even if the patient never even receives treatment. In turn, the dentists will provide treatment for free (for something involved or for frequent visits by one individual, a co-payment or fee may be charged).


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