Dental insurance is not actually insurance, and it is having a detrimental effect on patient care and the viability of practises. Dental coverage providers are reducing the sums they pay to dental insurance offices every year. Many clinics are looking at alternatives to dental benefit programs as a result of declining reimbursements and rising patient co-pays. The internal membership plan is a choice. In this article, we’ll talk about the basics of in-house plans and what hygienists should know about them.
Do dental benefit programs constitute insurance?
Patients and staff members alike frequently mistake dental benefit programs for dental insurance. There is no possible way that this is true! “The act, method, or business of insuring property, life, one’s person, etc., against loss or injury originating in certain circumstances such as fire, accident, death, disablement, or the like, in return of a payment appropriate to the risk involved,” is how Dictionary.com defines insurance.
According to this definition, dental insurance is not “insurance” because it does not offer protection against loss. Instead, it is a perk that the business offers to the worker and their family, much like paid time off. Let’s go through some of the history of dental benefits.
History Of Dental benefit plans
The development of dental insurance didn’t occur until the 1950s. Medical insurance has been around since the middle of the 1800s, but it took until 1954 for the International Longshoremen’s and Warehousemen’s Union and the Pacific Maritime Association to negotiate dental “insurance” as a perk of work.
This collective bargaining agreement provided dental insurance for union members’ children as well as a $750,000 payment to the dental societies of California, Washington, and Oregon. With the funds, two dental benefit organisations were established: the California Dental Association in 1955 and the Washington Dental Service in 1954.
Over 235,000 people were insured by the California Dental Association by 1963, when over 7,500 dentists had joined. The American Dental Association proposed the Delta Dental Plans Association, a federal body under the National Association of Dental Plans, in 1966 as knowledge of the group and its services expanded across the nation. Employer-based plans expanded in the 1970s, and the annual benefit ceiling was set at $1,000. In the 1970s, Delta Dental oversaw the majority of the schemes.
However, huge dental insurance organisations, or PPOs, were established in the 1980s (preferred provider organisations). A PPO was created as a network of dentists who have agreed to treat the insured for a lower cost. Patients who visit dentists who practise outside the network are also covered, but the patient is still responsible for the cost differential.
The Dental Health Maintenance Organization (DHMO) was created as PPOs became more and more popular. With no maximums or deductibles, DHMOs mandate that the insured visit a participating provider at a discounted rate. Approximately 77 percent of Americans had dental insurance in 2017, according to enrollment data from the National Association of Dental Plans, but many patients don’t make use of their legal entitlements.
Since insurance plans now provide dental care up to age 18, this now includes 90% of young people, according to the Affordable Care Act. In all 50 states, Puerto Rico, and the US Virgin Islands, 78 million Americans are covered by just Delta Dental policies. Dental benefit coverage is still at 1970s levels despite rising inflation! Average yearly maximums would be close to $10,000 if coverage had kept up with inflation rates!
Additionally, dental benefit providers are requiring dentists to write off an increasing percentage of the differences between the actual cost of the services and their benefits, while simultaneously raising the amount of money patients are required to pay out-of-pocket without any out-of-pocket maximum that is beneficial to medicine. As is clear, dental insurance is absolutely not insurance!
Plans for Internal Dental Insurance Membership
In light of all of this information and the expenses and overhead associated with running a dental practise in 2019, many dentists are searching for methods to boost income, help patients get the dental care they require, and expand their patient base. Thus, internal dental membership programmes were introduced.
Many commonplace suppliers have introduced loyalty or subscription schemes to patients. For patients without insurance or for whom dental insurance is either too expensive or not worth the investment, in-house membership schemes function similarly to these loyalty or subscription programmes.
Only patients who do not enrol in their employers’ dental benefit plans are eligible for in-house dental programmes. Many practitioners are showing patients that the in-house plan is frequently less expensive than the employer plan with the deductibles, maximums, and co-payments they would choose. Teresa Duncan, a renowned national dental consultant, recently conducted an insurance focus group and asked participants about their usage of internal membership programmes.
One comment read, “Telling patients that their $200 visit was included in their plan today has a bigger impact than saying everything was covered today.” Another read, “We expect our baby boomer patients who will be retiring to be interested, so they won’t disappear from the practise thinking that they can’t afford treatment or that Medicare HMO will cover it; yet they don’t realise how far from the truth that is.”
It makes sense to buy it, get another prophy free, and get a 25% discount on all other services as it is just slightly more expensive than the prophy UCR (Teresa Duncan, email communication, February 2019).
How do internal plans operate?
Internal membership programs provide patients with access to cheap care while boosting the practice’s efficiency and profitability. The charge that the patient, whether they are a person or a family, pays serves as the foundation of the in-house membership plan. This cost may be a yearly or monthly subscription paid straight to the doctor’s practise or to a third-party supplier. A variety of prophylaxes, assessments, radiography, and discounts on all other services are made possible by this membership.
Patients have the right to be subscribers and receive services from practitioners for a continuous 12-month period. The doctor’s practise can decide how many prophy visits and other services they really discount. Some programs even give referral bonuses to medical professionals. The patient receives a prevention-focused program through this, but they have the freedom to pick which services they want to subscribe to. The larger the number of discounted services, the higher the subscription rate. The practise may increase income and provide the best possible patient care without interference from dental benefit plan providers by giving in-house memberships in order to cultivate a more devoted patient base that pays for services.
The following factors:
Although internal membership programs are unquestionably advantageous in the current dental landscape, there are a number of concerns that need to be resolved about their use. Since some states may view these programs as a form of “insurance,” practises interested in offering their patients an in-house program should consult an attorney regarding any state-specific rules or regulations governing these programs. If this is the case, the practise would then need to be registered as an insurance company.
Maintaining the patient subscription base and figuring out how to keep patients in the programme while promoting it to new patients are other responsibilities that team members must take on. The practise must evaluate the true cost of the program for the patients; if set too high, the advantages are frequently cancelled out, while if set too low, the practise experiences a financial loss as if the program were insurance-based. With all of these factors taken into account, some practises decide to administer their internal programs with the help of outside providers.
An SAAS is provided by an external provider (software as a service). Many suppliers on the market today can assist with the development, execution, management, marketing, and compliance of internal strategies. These suppliers may charge a fixed practise licence fee or deduct their cost from the in-house plan cost per patient.
The optimum choice is frequently determined by how many patients are enrolled in the in-house plan. For instance, the charge per patient would be preferable if the practise is just starting a program, but a more established practise with a large number of patients registered might choose the flat membership fee.
These suppliers offer a tailored strategy for the practise along with continuous patient marketing and retention activities. Any marketing effort must guarantee adherence to all state laws and regulations and offer the practise with information on the return on investment, as well as the improvement the practise sees in income and profitability.
Hygienists focus on prevention and often avoid talking about money with patients because they are focused on prevention.Our patients rely on us to recommend the best course of action, yet they frequently turn down care because “my insurance doesn’t cover it.” A practise that provides an internal membership program helps patients afford the care they require while reducing the stigma associated with insurance non-coverage. Both the patient and the practitioner may gain from this.