How Dental Insurance works

The right dental plan can help improve oral health and contribute to your overall health and well-being. But before you choose your dental insurance, it’s important to understand how the plan works, what it covers, and the value it provides for the cost. Whether you’re planning for braces, or just want to stay on track with cleanings, knowing how dental insurance works can help you choose the right plan for your family’s needs and budget.

What is dental insurance?

Simply put, it’s a type of insurance coverage that should help you do these two things:

1. Cover preventive care to help ensure you get regular checkups, cleanings and basic care

2. Provide access to a dental network to help save on more advanced treatments

Preventive care can help keep you and your family healthy and may lessen the need for more costly dental procedures down the road. Using dentists within the network will provide savings in dental care for you and the whole family.

Dental insurance basics

Dental plans are generally available in two ways: through your employer or directly from a company that offers dental insurance.

Each dental plan can have different coverage features and benefits. When weighing your options, be sure to compare these things based on what your family needs:

Preventive care

Dental plans may have different features, but nearly all of them emphasize preventive care. Coverage is designed to help make it easier for you to prevent serious oral health conditions like tooth decay. So, your dental insurance should allow you at least one preventive cleaning per year. In addition, consider whether the plan offers:

• X-rays

• Routine oral exam

• Sealants

• Fluoride treatments

Out-of-pocket costs

Dental insurance is similar to health insurance in that there are deductibles and coinsurance, but they tend to work differently. Here are some of the out-of-pocket costs you may have:

• Deductibles: Many dental plans include a deductible that you must meet before dental coverage will kick in. Others, such as dental indemnity plans, will require you to pay upfront for services and then submit for partial reimbursement later.

• Copays: Some dental plans require you to pay a set amount out of pocket for each dental visit or procedure.

• Coinsurance: This is the percentage of covered treatment costs that you are responsible for paying after meeting your deductible. For example, there may be a 70/30 split, where the insurance company pays 70% of the covered cost and you pay 30%.

Network coverage

Different providers and types of plans have different networks that can vary greatly in size. It’s important to determine:

• The number of dentists in the network

• If the network includes dentists near your location and/or a dentist you prefer

• Whether you must choose a primary care dentist or have one assigned to you

• Which services are considered “in-network”

• If certain out-of-network services are still covered in some way

Types of dental insurance

• Dental PPO: Also called a DPPO, short for Dental Preferred Provider Organization. These dental plans typically provide free preventive checkups, cleanings, and x-rays, but there are usually copays (see below) for other more advanced treatments. The big advantage to a Dental PPO is dentist choice: there's typically an extensive network of dentists, but the insurance company also lets you see out-of-network providers. Still, it pays to stay in-network because you pay less and don't need to submit claims.

• Dental HMO: Also called a DHMO, or Dental Health Maintenance Organization. These work like an HMO health care plan: you choose a Primary Dentist and go through them for all care, including specialist referrals. DHMOs typically give you fewer dentist choices because the networks are limited, and there's no out-of-network coverage. On the plus side, premiums tend to be lower, and many DHMOs have no deductibles or caps. While there are flat-rate copayments for most non-preventive treatments, your overall costs will likely be lower.

• Indemnity plans: This type of dental insurance lets you see any provider, but you have to pay the entire fee upfront. The insurance company reimburses a portion – usually between 50% and 80% of the "reasonable and customary" charge. Indemnity plans tend to have higher premiums and are harder to find.

What about dental discount plans?

Discount plans aren't really dental insurance — and may not even come from an insurance company. The plans work more like a warehouse club: there's an annual fee, and you're given a card that entitles you to reduced charges at participating dentists. The savings vary – but there's always an out-of-pocket charge, even for preventive checkups and cleanings.

Coverage details to consider

• Waiting periods: Generally, you might have to wait up to six months or less for cavity fillings and other minor dental procedures, and up to 12 months or less for major dental work, such as crowns.

• Annual maximums: Some dental plans place a cap on the total dollar amount the plan will cover for you in a given year, called an annual maximum. The annual maximum is important to consider, especially if it applies to more than one family member. Some plans may allow you to tap into your annual maximum if you do not spend it all in one year. Some dental plans, for example, will allow you to roll over portions of your annual maximum that you do not use to the next year as long as you complete your preventive screenings. That can come in handy in the event you need major dental work.

• Cosmetic procedures: Find out which procedures your dental plan will not cover because they are considered cosmetic. For instance, some dental plans consider certain types of crowns cosmetic.

• Tax credits*: Learn if you can deduct your dental insurance premium from your taxes. Your dental plan premiums may be tax deductible, depending on how they are paid and how you are using your benefits. For example, you may be able to deduct your dental plan premium if you are using your benefits for preventive oral care. Cosmetic procedures, such as teeth whitening, would typically not qualify for a tax deduction.
  If you’re paying your dental premium using a Health Savings Account or Flexible Spending Account, you would likely not be eligible for a tax deduction, as the money in these accounts is already pre-taxed.

• Dual coverage: You may be covered for dental benefits by multiple plans, such as when you and your spouse have separate dental insurance. Your dental insurance should coordinate benefits so that the dental care your family needs is covered by each insurer.

For example, if the dental plans only offer one cleaning each per year, that doesn’t mean you will be covered for two cleanings. Make sure to check if coordination of benefits is offered by each plan.

Pre-treatment estimates

If you anticipate the need for major dental work, or just want to get an idea on service pricing, ask your dentist for a pre-treatment estimate. This can help you get an idea of how much money different procedures will cost.