Are You Confused With Dental Insurance?
Sometimes reviewing and understanding your dental insurance policy can seem like you’re trying to decipher the tax code.
If the terminology of your dental insurance benefits confuses you, you’re not alone.
While it may help to have a dental dictionary on hand, it’s not too practical to carry with you to the dentist.
According to Delta Dental, a 2016 survey found that only 4% of Americans could identify basic insurance terms and definitions.
So let’s get back to basics.
To help you better understand your dental insurance benefits, let’s put the confusion to bed and define five of the most commonly misunderstood dental insurance terms.
But first, an important reminder…
YOUR DENTAL INSURANCE BENEFITS & FLEX SPENDING ACCOUNTS EXPIRE AT THE END OF EACH YEAR!
In order to maximize your benefits, you need to use all of the available coverage & funds each year, otherwise, you’re just wasting money on dental insurance.
5 Commonly Misunderstood Dental Insurance Terms…And Their Definitions
1. Premium
Everyone that pays for dental insurance should know this one, you’re paying it every month.
Your dental insurance premium is usually a monthly charge associated with your policy. It is the amount you pay for coverage to your insurance provider.
For those of you that have your dental insurance covered by your job, then that’s the amount of money your employer pays to the insurance company either in its entirety or in part, depending on your benefits package.
2. Co-Pay
A co-payment or co-pay as it’s commonly called is the fixed amount you pay for a covered dental care service after you’ve paid your deductible.
It’s basically a cost-of-sharing arrangement in which you pay a specific charge at the time of service.
For example, if your copayment for a visit to the dentist is $20, that is the amount you pay at the time of your visit.
For preventative dental exams and routine cleanings that is often the only amount you will pay out of pocket.
Just remember, this is only after you’ve already met your deductible. Which brings us to…
3. Deductible
Your dental insurance deductible is the minimum amount that must be paid before your policy pays for any treatment or service.
For example, if your deductible is $500 and the treatment you are undergoing will cost $350, your dental insurance will not pay one red cent.
By the same token, if your deductible is $500 and the treatment you are undergoing will cost $1500, then you will only pay $1000.
Until you have paid all of your deductible you will be responsible for paying the full amount of any recommended treatment.
One caveat here, deductibles usually only apply to basic or major treatment, not routine teeth cleanings and dental exams.
Just remember to check with your insurance provider to be absolutely sure what your coverage allotment is.
4. Coinsurance
Coinsurance is the percentage you pay out of pocket for dental treatment after you’ve met your deductible.
For example, say your dental insurance policy stipulates that they will cover $400 for a composite (tooth-colored) filling, and your coinsurance is 20%.
That means you will pay $80 and your insurance policy will pay $320.
5. Annual Maximum
This is the maximum dollar amount that your dental insurance policy will pay toward the cost of dental care within a specific benefit period – typically January through December…because remember, your dental insurance expires annually.
Don’t confuse your annual maximum with the maximum amount you will pay out of pocket for any dental treatment you receive in that given year.
You are responsible for paying costs above the annual maximum.
For example, say your policy’s annual maximum is $2,000, that means your dental insurance will pay for select treatment (as defined in your individual policy) up to that amount for any covered services you receive during that year.
After your annual maximum amount is met, it is then your responsibility to pay for any additional treatment you receive, until your policy resets in January.
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