Does Having Two Dental Insurances Work?
Uncover how multiple dental insurance plans function together to potentially optimize your benefits and reduce treatment costs.
Many individuals consider maintaining more than one dental insurance plan, often when coverage is available through personal employment and a spouse’s plan, or a second job. Understanding how multiple dental insurance policies interact is important for managing healthcare costs effectively. The common question revolves around whether two plans genuinely reduce out-of-pocket expenses or simply duplicate coverage without added benefit.
Understanding Coordination of Benefits
When an individual holds coverage under more than one dental insurance plan, Coordination of Benefits (COB) comes into effect. This system regulates how multiple insurance plans pay for dental services, preventing combined payments from exceeding the total allowable expense for a treatment. COB rules establish a clear order for payment, designating one plan as “primary” and the other as “secondary.”
The primary plan pays its benefits first, according to its own terms and conditions. Following this, the secondary plan assesses the remaining balance, applying its benefits based on its policy rules and COB provisions. This process aims to maximize benefits received and reduce the patient’s out-of-pocket costs, such as deductibles, co-payments, and coinsurance.
The secondary plan typically pays up to its maximum allowable amount for the service, considering what the primary plan has already contributed. It does not pay benefits that would result in the patient receiving more than 100% of the total service cost.
Determining Primary and Secondary Coverage
The designation of which dental insurance plan acts as primary and which becomes secondary follows established industry rules. For dependents covered under multiple plans, the “Birthday Rule” is commonly applied. Under this rule, the plan of the parent whose birthday falls earlier in the calendar year is typically considered the primary plan, regardless of the parent’s age. For instance, if one parent’s birthday is in March and the other’s is in August, the March birthday plan would be primary.
When an individual has dental coverage through their own employer and is also covered as a dependent under a spouse’s plan, their employer-sponsored plan is generally designated as the primary insurer. The spouse’s plan then serves as the secondary coverage.
Other scenarios also dictate primary and secondary status. For individuals with coverage from multiple employers, the plan of the employer for whom the person has worked longest may be primary, or it could depend on specific plan language. If an individual has COBRA coverage from a previous employer and also new coverage, the new active plan is often primary. Individuals should review their specific plan documents or contact their insurance providers directly to confirm the precise rules.
Claim Submission and Reimbursement Process
When an individual has two dental insurance plans, the claim submission process typically begins at the dental office. The dental provider usually files the claim directly with the primary insurance carrier first, including all necessary information about services rendered and costs.
After the primary insurance processes the claim, it issues an Explanation of Benefits (EOB) to both the patient and the dental office, detailing its payment and any remaining balance. The dental office then uses this EOB to submit a secondary claim to the patient’s secondary dental insurance plan. This secondary submission includes the original claim information and details of the primary plan’s payment.
The secondary insurance plan then reviews the submitted claim, applying its benefits and Coordination of Benefits rules. It pays any eligible remaining amount, up to its policy limits, considering what the primary plan has already paid. The patient subsequently receives an EOB from the secondary insurer, outlining its contribution and any final patient responsibility.
Financial Implications
Having a secondary dental insurance plan can offer financial advantages by reducing a policyholder’s out-of-pocket expenses. After the primary plan pays its portion, the secondary plan can contribute towards remaining costs such as deductibles, co-payments, and coinsurance. This can significantly lower the amount an individual would otherwise pay directly for dental services.
While dual coverage can decrease patient responsibility, it typically does not result in 100% coverage for all dental treatments. Both the primary and secondary plans have their own limitations, annual maximums, and specific percentages of coverage for different services.
Individuals should carefully evaluate the combined premiums for both dental insurance plans against potential savings on dental treatments. For those who anticipate extensive dental work or have ongoing oral health needs, the expense of two premiums might be justified by the reduction in direct treatment costs. However, for those with minimal dental needs, the additional premium might outweigh the financial benefits.