What Should I Look for In a Dental Plan?
Choosing a dental plan to offer your employees can be confusing & overwhelming. There are so many options out there, but it is hard to tell what is worth a higher price and what’s not, especially if this is your first time offering a dental plan. We will always quote our clients what we feel are their best options for their industry, company size, and budget, but here are a few pointers if you are doing initial research on your own:
Always choose a PPO!
It’s no secret that HMO dental plans are CHEAP – but that is for a reason! Much like a medical HMO, dental HMOs require the employee to use an in-network provider. These are providers that sign a contract with the dental carrier to offer services at a pre-determined rate. If you were a dentist, would you want to operate in this way? Probably not – which is why employees with an HMO dental plan have a hard time finding dentists. The best/most popular dentists usually do not use an HMO network.
Furthermore, if an employee chooses to go out of network with an HMO dental plan, there is NO coverage for the service they receive out of network (vs. PPO where there is coverage, just at a lower rate). Also, to see any specialist, the member has to get a referral from their primary dentist.
PPO plans allow members to choose the dentists they wish. There is a network in which they will have a higher benefit, should they stick to this network, but coverage is also available outside of it. Dentists aren’t held to a set fee for a service, but regardless, covered services still end up being less expensive for the member when using a PPO.
Never pick a plan with a waiting period!
If you are looking at dental plans side by side and a PPO plan’s pricing seems too good to be true – it probably is! Something driving the cost down on a plan may be a “wait on major services” – you will usually find this towards the bottom of the benefit summary. This “wait” is a waiting period, which is usually a year long, in which the plan will not cover any major services. For employees getting on a dental plan who know they need procedures done, this can be incredibly frustrating.
One place we often see waiting periods is on voluntary plans. Think of it from a carrier’s perspective to understand why: if the employee is responsible for paying for the whole plan themselves, those who know they have procedures coming up are much, much more likely to sign up. This tips the risk scale heavily against the insurer, as they are then likely to pay out much more in claims than they have collected in premium. The waiting period is partially a safeguard against this happening.
Always check this on your summary documents; it can be a huge issue for an employee who thinks they have coverage, schedules a major procedure, and then is stuck with the whole bill!
Usually, go with a $1,500 calendar year maximum
PPO Dental plans are built with an annual maximum benefit. This is the top amount the carrier will pay out during the year. No matter how much service is used, they will stop paying after this point. Annual maximums most commonly come in increments of $1,000, $1,500 and $2,000, and occasionally higher. We find that $1,500 is great for most employees. It will cover the majority of your employees without driving up costs for the whole group for the few who would need a higher benefit. But if you are looking for a truly great plan, a $2,000 or $2,500 benefit will thrill those employees who need major procedures.
Make sure “endo & perio” are paid as “basic”
Dental services are divided into 3 levels, which are paid at different percentages according to the plan benefits. These are preventative, basic & major. Preventative is paid at the highest level, usually completely covered, and major at the lowest. Endodontic and Periodontic services are sometimes classified with major and sometimes with basic. Make sure your plan classifies them with basic, as this will cover them at a higher level and therefore your employees will pay less for service during the course of the year.
Add orthodontia – maybe!
Whether to choose a plan with orthodontia depends on the demographics of your employees. The instinct is to think that a plan with an orthodontia benefit is better, however if your employees don’t have kids, it may be useless. A plan that adds orthodontia coverage will always be more expensive for the whole group, so make sure that it’s going to be useful before you add it. For those employees who have kids in braces, it can be massively valuable.