What type of plan do you have

Direct Reimbursement Programs - The employer or plan sponsor reimburses the patient for the cost of treatment, typically up to a fixed dollar amount per year.  How the money is spent is usually up to the patient with few if any restrictions.  The patient pays the dentist and gives his paid receipt to the employer for reimbursement.  Advantages to the employer are simplicity and fixed cost (the employer determines how much reimbursement the employee can receive as his benefit for the year).  The dentist and patient enjoy freedom from the burdens of insurance company forms and restrictions, and the dollars available for treatment are increased because there is no insurance company profit to pay.

"Usual, Customary and Reasonable" (UCR) Programs usually allow patients to go to the dentist of their choice. These plans pay a set percentage of the dentist's fee or the plan administrator's "reasonable" or "customary" fee limit, whichever is less. Although these limits are called "customary," they may not accurately reflect the fees that area dentists charge.  The insurance company can set the "customary" fee level at any amount they want. The patient must pay the difference between the benefit determined by the insurance company and the actual fee charged.  These plans usually also include a deductible and a yearly maximum, which limits the amount the insurance will pay in a year.
The "customary fee", deductibles, and yearly maximum limits are determined by the contract between the plan purchaser (usually the employer) and the insurance company.  They are designed to limit the insurance company's risk.  The higher the risk the higher the premium.  This type of insurance is sometimes called a Traditional or Indemnity plan because the risk belongs to the insurance company.

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Table or Schedule of Allowance Programs pay a specified dollar amount for procedures on the plan's list of benefits.  The dollar amount paid is up to the insurance company and is usually much less than the actual fee charged for the procedure.  The patient pays the difference between what the plan pays and what the dentist charges. This type of plan is sometimes called a "dental assistance" plan because the benefits paid are not intended to cover the dentist's charges - just provide some financial assistance in paying them. This type of plan can have deductibles, annual maximums or other benefit limits.

Preferred Provider Organization (PPO) Programs contract with dentists for fee discounts.  Names of participating dentists are distributed to patients.  The advantage for the insurance company is lower procedure costs.  The dentist hopes more patients will be attracted to his practice by the lower fees, and  by being "on the list".  The dentist must make up the money lost because of  the discount by doing more procedures for each patient, or by seeing more patients (increasing volume).  To get full financial benefits from their plan the patient must go to a dentist who has contracted with the insurance company to work at a discount.  If the patient chooses a dentist who does not participate in the plan, the insurance will pay less or not at all. This type of plan typically has deductibles, and annual limits.

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Capitation Programs contract with dentists to provide certain services in return for a fixed payment (usually on a monthly basis) per enrolled family or patient.  The total annual payment is typically less than the dentist would receive for performing two regular recall visits at his usual fees.  The dentist receives this "capitation fee" whether any patients are seen or not.  To receive benefits the patient is required to sign up with a dentist and go to him for all services.
The advantage to the insurance company is that their risk is eliminated.  They charge the employer more per month than they pay the dentist and pocket the difference.
The risk has been transferred to the dentist.  The dentist hopes that the people who sign up to go to him will need as little treatment as possible, or will not show up at all, since he is paid the same amount each month whether he provides any services or not.  The dentist has some measure of control over this risk because he determines what treatments are "necessary" and when they will be performed.
The patient hopes that the dentist he signs up with will provide good timely care even though every procedure performed costs the dentist money.
Vernon Dental Associates dos not participate in capitation programs.

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Last modified: 05/03/04