How Does Dental Insurance Work?

Many consumers disregard dental insurance and consider it a luxury item they don't need. However, if you've ever experienced a toothache, you know that they don't give you any notice, and you need to find (and pay for) dental care quickly.

Dental insurance is the best way to be prepared for any dental emergency. Having insurance will save you money in emergency and non-emergency situations. Plus, routine dental care can actually prevent emergencies from occurring. With dental insurance, preventive dental care will cost much less, allowing you to get the care you need.

How Dental Insurance Works

Dental insurance is somewhat easy to understand, especially when compared to the various kinds of medical insurance on the market. Many of the basic concepts are the same, but the way dental insurance works is more standardized. Once you know some important terms, you can simply compare one dental insurance plan to another.

Waiting Periods

Most dental plans have waiting periods. A waiting period is a certain amount of time you must wait before having coverage on some procedures. While each carrier sets its own rules around waiting periods, the most common time limit is 12 months for major services. We'll talk more about what a "major" service is later. For now, understand that the waiting period does not typically apply to routine cleanings.

Annual Deductibles

A deductible is an amount you must pay before the insurance plan begins paying for services. Dental insurance deductibles are usually much lower than medical deductibles. In fact, some plans do not have a deductible at all. A typical annual deductible will range from $25 to $100.

Deductibles do not usually apply to preventive services like cleanings, exams, and x-rays.

Benefit Maximums

Dental insurance plans have a maximum amount they will pay towards services each year or benefit period. Some plans use the calendar year and renew their benefits every January, while others operate on a benefit period that begins the first month of coverage. For instance, if your plan runs from May 1 to April 31, your benefits would renew on May 1.

Maximums depend on the plan but can range from $1,000 to $5,000 per year. Once the insurance company has paid the maximum amount, all other expenses will be your responsibility.

Some carriers apply preventive services to your annual maximum, while others do not.

Copays and Coinsurance Costs

A copay is a fixed amount you are responsible for, whereas a coinsurance amount is a percentage of the expense. Most dental insurance plans use coinsurance payments instead of copays.

Your coinsurance responsibility will be determined based on which category a dental procedure falls into. Each category is covered at a certain percentage according to the policy. You’ll be responsible for any coinsurance amounts, as well as the deductible if one applies.

Dental Procedures Categories

Every dental procedure is categorized into one of three types of services: preventive and diagnostic, basic, and major. The insurance plan decides which category each of the procedures falls into. This can vary based on the plan, but we'll discuss the most common method here.

Preventive and Diagnostic Services

Preventive and diagnostic services include any procedure used to prevent or diagnose dental conditions. For example, dental cleanings, routine exams, fluoride, and x-rays are all preventive and diagnostic services.

Dental insurance plans allow for at least two cleanings and exams per year, as well as various x-rays. As we mentioned before, waiting periods and deductibles often don't apply to these services. In addition, most plans cover preventive and diagnostic procedures at 100%.

Basic Services

The most common procedures found in the "basic" category are fillings and extractions. Many dental insurance plans also include endodontics (root canals) and periodontics (gum surgery) in the basic category, but some move them into the major category.

Basic services are often covered at 80% and are subject to the plan's deductible and maximum. 

Major Services

Major services include crowns, dentures, and bridges. If the plan includes dental implants, it is usually grouped into the major category. Major services are typically covered at 50% and are subject to the plan's deductible and maximum.

One last thing to note about coinsurance amounts. Some plans increase their coinsurance percentages the longer you have the plan. For example, you may start with a plan that pays 40% of major services but increases that to 50% after one year of coverage. In some cases, your annual maximum may also increase.

Remember, each dental plan is different. You should consult the plan's summary of benefits to understand the plan's coverage. You can also chat about your options with the insurance agents at Local Medicare Specialists. We can review your current insurance and compare it to other available plans. Whether you need a stand-alone dental policy or would like to know about dental coverage included in Medicare Advantage plans, we’ve got you covered!