Knowing Your Coverage

When an employer buys a dental insurance policy from an insurance carrier, there are several things to consider. These include cost, coverage, availability of phone support for answering policy questions, and efficiency at processing insurance claims.

Much like other types of insurance, the price of the policy determines what kind of coverage you get. In today’s market, most carriers sell “cafeteria style” policies, allowing each employer to choose what will and will not be covered. When a procedure is excluded by your insurance company, this doesn’t mean that the procedure is not “dentally necessary” but rather a restriction of your plan. Frequency limitations are an example of policy restrictions. Some policies allow certain procedures to be performed only so often, such as x-rays every six months or every year; or crown replacement every three, five, seven or ten years. Your coverage may only allow benefits for the least expensive treatment for a condition. For example, they may reduce the coverage of a tooth colored composite filling on a back tooth to the coverage of a silver amalgam filling.

Another area that affects premium costs is the “ceiling amount” the carrier will pay per procedure. The term that the insurance carriers use for this is “UCR” or “Usual, Customary and Reasonable”. Unfortunately, many patients interpret this term as meaning “What it should cost”. There is no regulation as to how insurance companies determine “UCR” reimbursement levels, resulting in wide fluctuation. In addition, insurance companies are not required to disclose how they determine these levels.

If the employer wants to keep costs down, one option is to buy a plan that reimburses at a reduced level, or low “UCR”. With a particular procedure for which most dentists charge $550, some policies may base their “ceiling” payment at $600 or higher, while other policies may base reimbursement on $500 or less. Lowering the “ceiling” reduces the cost of the insurance policy. Some companies buy different levels of coverage for different employees, all through the same insurance company in order to control cost. So “Usual, Customary and Reasonable” (UCR) can vary significantly even with the same employer and insurance carrier. If a patient receives a comment on their explanation of benefits (EOB) that the dentist’s fees were not UCR, they often think their dentist’s fee is higher than most other local offices. Although this can be a common misconception, it would be more accurate to state that their employer chose a plan that does not reimburse at the level most dentists in the area charge. The patient would then be responsible for additional “out-of-pocket” payment because their coverage was reduced to lower the premiums of the employer’s policy.

If your coverage is inadequate on certain dental procedures, it is likely that coverage was reduced in that area to lower the cost to the employer’s insurance premiums. It is not unusual to have above average coverage on some procedures and below average coverage on other procedures all within the same policy. There is a very wide range of insurance coverage based on individual policies. Your dentist provides dental care to you at a fee she/he has determined to be reasonable considering factors such as time, skill, experience, overhead and quality of service.