How Does Dental Insurance Work?

Dental insurance policies help many people effectively budget for the cost of maintaining their dental health. Dental health is an incredibly important component of overall health and it’s unfortunate that it’s not covered under the same umbrella as medical care. Compared to medical insurance, dental insurance is very limited. Most policies are straightforward and specific regarding which procedures are covered and exactly how much benefit you will have. Most policies are very limited in the total yearly amount that will be covered.

Dr. Susan Fredericks, DDS, MPH, of Southern Cal Smiles thoroughly explains how dental insurance works, so you can understand your coverage and get the dental care you need without breaking the bank.

KEY TAKEAWAYS

  • Dental insurance covers issues related to the teeth and gums, as well as preventative care such as annual cleanings.
  • Not all procedures are covered; for example, cosmetic procedures, such as veneers or whitening, are not.
  • Deductibles, co-pays, and coinsurance will apply, and most policies have annual coverage maximums that are relatively low, ranging from $750 to no more than $2,000 in most cases.

Overview of the System

How private dental insurance works:

  • You select a plan based on the providers (dentists) you want to be able to choose from and what you can afford to pay. This can be almost any dentists in a PPO (preferred provider organization) or very limited network in a HMO (health maintenance organization).
  • If you already have a dentist you like, and they’re in the insurance company’s network, you’ll be able to opt for one of the less expensive plans.
  • If you don’t have a dentist, you can choose from the dentists who are in the network and again have the option of a less expensive HMO plan.
  • If your existing dentist isn’t in the network, you can still get insurance, but you’ll pay more to see your dentist than an in-network one — however by being in network, the dentist will take a significantly lower fee, so you don’t always have the most experienced or talented dentists in the reduced fee plans, as is true with HMO dentists
  • The monthly premiums will depend on the insurance company, your location, and the plan you choose. For most, the monthly premium will be around $50 a month. This means that you’re spending $600 on dental costs each year even if you don’t get any work done. So it’s important if buying insurance to use it.

Waiting Period for Dental Insurance

Most dental insurance policies have waiting periods ranging from six to 12 months before any standard work can be done. Waiting periods for major work are typically longer and can be up to two years. So, you could invest more than $1200 in premiums, before any major work will be covered. These periods are set in place by insurance companies to guarantee that they profit off a new account and to discourage people from applying for a new policy to cover impending procedures.

Deductibles, Copays, and Coinsurance

An insurance deductible is the minimum amount that must be paid before the insurance policy pays for anything. For example, if the deductible is $200, and the covered individual’s procedure is $179, the insurance doesn’t kick in and the individual pays the entire amount. Copays, which are a set dollar amount, may also be required at the time of the procedure.

When a dental deductible is met, most policies only cover a percentage of the remaining costs. The remaining balance of the bill paid by the patient is called coinsurance, which typically ranges from 20% to 80% of the total bill. Costs and what procedures are required may also differ based on the patient’s age. Seniors on Medicare, for instance, will have a different definition of what constitutes the best dental insurance than someone in an under 30 age group.

Most dental insurance plans follow the 100/80/50 payment structure: They pay 100% for preventive care, 80% for basic procedures, and 50% for major procedures. Again, often, insurance companies set their own reimbursement rate. So though they may cover 100% of a cleaning, they may cover only $75 dollars, while it’s possible that the going rate for this procedure, in your area, is $100.

How Dental Insurance Categorizes and Pays for Procedures

Every plan differs in terms of which procedures are categorized as preventive, basic, and major, so it ‘s important to understand what’s covered when comparing policies. Some policies classify root canals as major procedures, while others treat them as basic procedures and cover more of the cost.

Patients who may need costlier procedures should pay particular attention to the details of dental insurance policies. For instance, a single dental implant can cost $4,000 to $6,000. Many basic dental insurance plans don’t cover implants, and those that do come with limits and exclusions. With that in mind, many consumers choose dental insurance that will cover implants.

Dental Insurance Doesn’t Cover Cosmetic Procedures

Most dental insurance policies don’t cover any costs for cosmetic procedures, such as teeth whitening, tooth shaping, veneers, and gum contouring. Because these procedures are meant to simply improve the look of your teeth, they’re not considered medically necessary, and must be paid for entirely by the patient. Some policies cover braces, but those usually require paying for a special rider and/or delaying braces for a lengthy waiting period, or only to age 21.

Yearly Coverage Maximums

Though most medical insurance policies have yearly out-of-pocket maximums, the majority of dental policies cap the amount of annual coverage to a very limited amount. Coverage maximums typically range from $1,000 to $2,000 per year. Generally speaking, the higher the monthly premium, the higher the yearly maximum. When patients reach the yearly maximum, they must pay for 100% of any remaining dental procedures. So, your policy may cover an implant and it costs $5,000, but you only get $1,000 in total yearly benefit.

Health insurance is a necessity for one simple reason: very few of us have the money to handle a critical illness. But what about dental insurance? This isn’t like medical insurance because here it’s not just your teeth that get capped — It’s also your benefits.

Forty percent of Americans don’t have dental insurance, according to the National Association of Dental Plans, and the majority of those who do, get it through their employer. Policies you buy individually could cost $50 a month or $600 a year. Policies through a large company are less expensive, $25/month, because in any given year, 50% of people who have dental insurance DON’T USE IT, so their unused policy dollars are being used by the other 50% So if you’re paying for your own policy, should you buy it? Well, the ideal person to discuss it with is your dentist.

If your plan costs more than half of what you’re going to be receiving per year, then you really have to think about whether it’s worth it. And just paying out of pocket. Also keep in mind the power of prevention. Taking care of your teeth and overall health now can save you time, money and pain later. A regular dental check up is the best way to avoid costly involved problems that can quickly add up to thousands of dollars.

Bottom line… You might want to think twice before you take out a dental policy.

Dental insurance is a way to avoid the high costs of unexpected dental emergencies and to cover routine dental visits. According to the National Association of Dental Plans, about 77 percent of Americans in 2016 had dental insurance. If that many people are insured, then dental insurance must be a good investment, right? The answer is: maybe.

Let’s take a realistic look at dental insurance by examining the costs and coverage to determine if it’s right for you. Americans pay about $360 a year on average for dental insurance, which can range between $20 — $50 per month. How much a person pays depends on the plan they have, what state they live in, and how much they pay in premiums.

Types of Dental Insurance

Preferred Provider Organization (PPO)

When you use a PPO, you pay reduced fees to visit “preferred” in-network providers. You aren’t required to use in-network providers, but it will save you money. And the PPO provider is limited by the dictates of the insurance company to often offer you the cheapest option, IE, a removable partial denture instead of a implant or bridge.

The good news is that the insurance network will pay more than an HMO (Health Maintenance Organization) plan or indemnity plan. However, you’ll end up paying more if you use a provider who’s not within the network. Additionally, dental PPOs often have a maximum amount they’ll reimburse you each calendar year.

Just half of PPOs cover over $1,500 each year and the other half only offer benefits below $1,500. Some procedures might have a waiting period before coverage begins. This type of plan might be useful if you don’t need immediate dental care and want low premiums.

Health Maintenance Organization (HMO)

Unlike a PPO where seeing in-network providers is just “preferred,” when you use an HMO, you’re required to use only the dental providers in the insurance network. While that means you get a minimal choice in providers, with an HMO preventative work is typically completely covered and you might not even have a deductible or maximum annual limit. 

Premium payments are also on the lower end. Again, they’re restricted by what the insurance plan dictates. You’ll have a co-pay for basic procedures. An HMO might cover under 50 percent of the costs of major or restorative procedures or not cover this at all and leave payment totally up to you.

Out of Pocket (No Dental Insurance)

Instead of using any dental insurance, you can choose to pay all of your dental care on your own.

Prices vary depending on where you live. If your area has a high cost of living, you’ll pay more. The American Dental Association (ADA) conducts surveys every few years to find the average American costs for various dental procedures. 

According to their  most recent publicly released data is from 2013, you can expect to pay around these prices for the following procedures:

  • Series of x-rays = $124
  • Teeth cleaning = $85
  • Silver dental filling = $125
  • White dental filling = $149
  • Porcelain crown = $1,000

2015 data provided to NerdWallet by FAIR Health shows the average national prices for three types of root canal procedures:

  • Front tooth = $762
  • Bicuspid = $879
  • Molar = $1,111 

If you don’t foresee needing dental care often and don’t like the concept of paying a yearly fee for something you may not use, you’re better off paying out of pocket. For some people, dental insurance is a good investment. 

For instance, dental issues aren’t entirely a result of lifestyle choices — they also have strong hereditary influences. If your family has a history of root canals, a high number of cavities, or other dental problems, there’s a good chance you’ll also end up needing a lot of dental work. This means you would have frequent dental bills from more regular treatments. In this scenario, you could make the most of your dental insurance.

Another situation where dental insurance makes sense is if you have little to no money set aside for emergencies. When you have no wiggle room in your finances, a major dental procedure can set you back financially. A root canal on a molar in Los Angeles can run between $1500 and $2000. One procedure can take your entire benefit. (AND YOU STILL HAVE REGULAR CHECK UPS)!!! 

Rather than choosing between long-term debt and severe dental issues, it’s better to have dental insurance at the ready. Dental insurance can also be motivational. If you need an incentive to stay on top of your dental cleanings and other preventive care, dental insurance might be beneficial to you. It’s standard for dental insurance to cover two annual cleanings. If you don’t use them, you’re missing out on services you already paid for. 

When Dental Insurance Might Not be Worth It

Many people find they end up losing money with dental insurance rather than saving any.

For instance, if you have healthy teeth and no unusual dental needs, annual dental insurance may not be useful for you. Except in the case of an emergency, you’ll be paying money into a plan that you almost never use.

Signing up for dental insurance when you already need an urgent dental procedure is also often useless. There’s typically a delay before dental insurance benefits kick in. For major procedures, you may have to wait a full year before your insurance would help with costs. This delay means you either have to pay completely out of pocket for your procedure (while paying for dental insurance that isn’t helping with the procedure) or wait a significant amount of time to get your work done. If you wait too long on a crucial dental issue, you can cause more oral health problems, possibly lose the tooth, and incur more cost later.

Finally, dental insurance isn’t worth it if there’s a specific dentist you want to visit who doesn’t accept dental insurance. Unlike health insurance, dental insurance isn’t accepted at all practices. Call your dental provider and ask if they accept dental insurance. You don’t want to enroll just to find out you can’t use your new insurance with your preferred provider.

On a final note: I’ve [Dr. Fredericks] been practicing dentistry for 41 years. When I started in dentistry, many insurance plans gave patients $1,000/year in benefits. NOW, 41 YEARS LATER, most insurance plans cover the same amount. There’s been no adjustment for inflation and cost of living!!!! If insurance companies were keeping up with the 21st century, plans should provide you $5,000 a year. That would cover one implant, or one root canals and two crowns. Dentistry has many high tech, expensive diagnostic, and restorative tools and equipment that weren’t there 40 years ago. 

Dental insurance companies are operating like it’s 1980, not 2023. It’s grossly unfair that this has been overlooked. Imagine if your medical insurance told you that your limit on healthcare payment was $25,000 a year? There were plans in 1980 that was the limit. $25,000 in medical cost can easily be blown through at the emergency room in 2022.

Quality dental care, like quality medical care costs money. Dentists go to school for 4 years of college, 4 years of dental school and then, if they become specialists, can invest another 2 to 6 years, bringing their education years to 8 to 14 years, including college. The cost of this education typically leaves a student $250,000 to $600000 in debt. To reimburse them in 1980’s dollars is ridiculous and disabling to patients who need more involved, sophisticated care.

How to Save Money on Dental Work

Even without insurance, there are ways you can save money on the dental work you get done.

One option is to visit a dental school where students conduct procedures while supervised by trained dentists. You pay a lower cost for appointments. The American Student Dental Association (ASDA) has 66 dental schools across the United States and Puerto Rico. Appointments at a dental school are often in high demand, so make sure to book your appointment in advance.

Try visiting a dental clinic. Clinics often offer a fee that’s based on your income and circumstances. . Check for low-cost care options in your state. Even if a clinic says they allow walk-in appointments, call ahead as you may need to put your name on a waiting list. Some people use dental discount plans. These are different from insurance and you can’t use a dental discount plan if you have insurance. 

A dental discount plan is similar to being a member of a club. You pay an annual fee and sometimes an enrollment fee and in exchange you get a discount on average dental care prices. These fees are usually lower than the costs of premiums on dental insurance policies, but you’ll pay more at the dentist’s office than you would with insurance. There are no waiting periods or annual caps. If you’re an AARP member or part of a similar organization, check to see if you’re eligible for group dental insurance plans offered by your membership.

Is Dental Insurance Worth It?

Whether dental insurance is worth it for you all comes down to personal preference and a combination of factors. If you have a family history of dental issues, are living on a tight budget, or need motivation to get your preventative dental work done; you may want to look into your options for dental insurance.

There are several types of dental insurance available including PPOs, HMOs, and fee-for-service plans. For people with very healthy teeth, employer-offered dental benefits, specific dentists they want to see who don’t accept insurance, or who already need urgent dental procedures done; dental insurance might be a waste of money. Without insurance, you can save money on dental work by using a dental school, dental clinic, or signing up for dental discount plans.

If you have any questions about dental insurance and care, Dr. Fredericks is happy to answer them. Simply call her Woodland Hills dental office at 818-346-3337, and she’ll be happy to speak with you. 

Southern Cal Smiles

6325 Topanga Canyon Blvd.
Suite 402
Woodland Hills, CA 91367

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