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Last week I was asked about dental insurance plans and
why they don’t seem to pay as much as they used to. I
mentioned that the most common types are traditional (indemnity)
plans, managed care plans, and direct reimbursement plans. I
briefly discussed traditional plans and promised a brief
description of managed care and direct reimbursement plans
in this week’s column.
Within the realm of managed care, the most common plans
are DMO’s (Dental Maintenance Organizations or “capitation” plans)
and PPO’s (“Preferred” Provider Organizations). Both
require participating dentists to sign an agreement with
the insurance company.
In a DMO, the dentist contracts with the insurance company
to provide all necessary dental care for the dental plan’s
enrolled members. The dentist is paid a fixed monthly
amount for each of the plan’s participants who select
that particular dentist. These patients must see one
of the plans “participating” dentists in order
to be covered under the plan.
Although the specific details of these plans vary somewhat,
this monthly fee is usually paid to the dentist whether
or not the patient ever sets foot in the dental office or
has any dental work done. While the dentist is contractually
obligated to do all necessary treatment for each of these
patients, he is generally not reimbursed beyond the original
agreed-upon monthly fee.
In a PPO, dentists sign a contract with the insurance company
and agree to lower their fees (sometimes substantially)
in order to attract patients who are covered by the plan. The
covered members of the plan must select a dentist from the
network of providers in order to receive the plan’s
maximum benefits.
Again the details vary, but usually these patients may
select a dentist outside of their network if they are willing
to pay higher deductibles and co-payments. This is
a penalty for being seen outside of the insurance company’s “preferred” network
of dentists.
Direct Reimbursement plans are becoming popular with many
employers. They provide employees with the opportunity to
select any dentist they want and receive reimbursement directly
from their employer for any dental procedures. Companies
manage these plans internally, instead of paying significant
premiums to insurance companies.
This allows companies to save a great deal of money, and
their employees have more options when it comes to their
dental care decisions. Direct reimbursement may provide
the best of everything – more options for patients,
lower internal costs for companies, and less insurance headaches
for dental offices.
Dr. Arnold practices dentistry in Chesterton and Valparaiso
and is a clinical instructor with the Hornbrook Group, which
teaches contemporary dental techniques to dentists from
around the country. For more information on this
or any other dental topics, please visit: www.smilesbyarnold.com. If
you have questions for Dr. Arnold, please send an e-mail
to: drarnold@smilesbyarnold.com or
a letter to: 1830 South 11th St., Chesterton, IN,
46304
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