With a Scheduled Dental Policy, How Are Covered Expenses Paid?
Unravel how scheduled dental policies determine coverage and pay for services. Understand their unique benefit structure and manage your dental expenses effectively.
A scheduled dental policy provides a structured approach to dental care coverage, outlining specific financial contributions for various procedures. This type of policy defines how covered expenses are paid by establishing fixed amounts for each service rather than a percentage of the total cost. This article will explain the mechanics of these policies, detail the payment processes involved, describe how claims are submitted, and offer insights into managing out-of-pocket expenses.
Understanding Scheduled Dental Policies
A scheduled dental policy operates with a pre-determined list of covered procedures, each assigned a fixed dollar amount that the policy will pay. This differs from other common dental plans that might cover a percentage of usual, customary, and reasonable (UCR) charges, or those that pay a percentage of the dentist’s fee. The policy’s “schedule of benefits” or “fee schedule” details specific dental procedures, such as cleanings, fillings, or extractions, and the exact monetary amount the policy allocates for each.
These scheduled amounts remain fixed, irrespective of what a dentist actually charges for a service. For instance, if the policy’s schedule lists $50 for a specific filling, the insurer will pay only that $50, even if the dentist charges $150. Policyholders are responsible for any difference between the dentist’s fee and the scheduled amount. Many scheduled plans also incorporate financial components like deductibles and annual maximums, which influence the overall benefit received.
A deductible is the initial amount a policyholder must pay for covered dental services before the insurance begins to contribute. An individual annual deductible can be around $50. The annual maximum represents the total dollar amount the dental plan will pay for a member’s dental care within a 12-month period. These annual maximums commonly range from $1,000 to $2,000, and once this limit is reached, the policyholder becomes responsible for all further costs until the next benefit period.
The Payment Process
The flow of funds under a scheduled dental policy occurs in one of two ways: direct payment to the provider or reimbursement to the patient. Most policies facilitate direct billing, where the dental office submits the claim to the insurance company on the patient’s behalf. In this arrangement, known as an assignment of benefits, the patient pays their portion of the cost, such as any deductible, co-payment, or the difference between the dentist’s fee and the scheduled amount, at the time of service. The insurance company then pays the scheduled amount directly to the dental provider.
Alternatively, patients may pay the full cost of the dental service upfront to the provider. The patient is then responsible for submitting a claim to the insurance company for reimbursement. Upon processing and approval, the insurer will send the scheduled benefit amount directly to the patient.
Deductibles and annual maximums influence this payment process. The insurer begins paying scheduled amounts once the annual deductible has been met. For example, if an individual has a $50 deductible, they pay the first $50 of eligible costs out-of-pocket before the plan contributes funds. Deductibles reset at the beginning of each plan year. All payments made by the insurance company count towards the annual maximum. Once this maximum is reached, the insurance company ceases payments for the remainder of that benefit period, making the policyholder responsible for additional costs.
Submitting Claims and Receiving Benefits
Submitting a claim to a dental insurance provider is a structured process, usually initiated by the dental office. Most dental practices handle claim submission electronically or via mail on behalf of their patients. This involves completing the American Dental Association (ADA) Dental Claim Form, which standardizes the information required for processing.
The claim form requires patient information, policy numbers, the date of service, and specific procedure codes, known as Current Dental Terminology (CDT) codes, for each service rendered. If a patient needs to submit a claim themselves, they must obtain an itemized bill from their dentist and accurately complete the necessary claim form. Policyholders should retain copies of all receipts and submitted claims for their records.
Once a claim is submitted, processing times can vary. Most dental insurance claims are processed within two to four weeks. Electronic submissions are often faster, sometimes within 7 to 14 days, due to streamlined systems. Paper claims or those requiring additional information can take longer, up to 60 days. Insurance companies also have “timely filing” guidelines, which dictate the maximum period, ranging from 90 days to 12 months from the date of service, within which a claim must be submitted.
After a claim is processed, the insurance company sends an Explanation of Benefits (EOB) statement to the policyholder, and sometimes to the dental office. An EOB is not a bill, but a summary explaining how the claim was adjudicated. It outlines the dentist’s original charge, the scheduled amount paid by the insurer, and any portion that remains the patient’s responsibility due to deductibles, co-payments, or amounts exceeding the scheduled benefit. The EOB also indicates how much of the annual maximum has been utilized.
Managing Out-of-Pocket Expenses
Even with a scheduled dental policy, policyholders often incur out-of-pocket expenses. This is because scheduled policies pay fixed amounts for procedures, meaning patients are responsible for any difference between the dentist’s actual fee and the amount paid by the policy. For example, if a procedure costs $200 and the policy pays a scheduled amount of $100, the patient must pay the remaining $100 directly to the provider.
Deductibles and annual maximums also contribute to out-of-pocket costs. If a service is not specifically listed on the policy’s schedule of benefits, it is considered a non-covered service, and the entire cost falls to the patient.
To manage these expenses, policyholders should discuss treatment costs with their dentist before services are rendered. Understanding the specific fee schedule of their policy helps patients anticipate their financial responsibility. Policyholders can also inquire about treatment plans that might spread costs across different benefit periods to optimize their annual maximums.