Dental Insurance 101: PPO VS Indemnity - Dental Jobs Expert

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Dental Insurance 101: PPO VS Indemnity

What is the difference between PPO VS Indemnity dental plans? I’ve heard a lot about this question, and I thought that it would be better if I post it on a new post instead of writing them every time I post an article about dental insurance. The PPO and indemnity plans are currently the most common dental plans used in United States. Most of the popular plans uses either PPO or indemnity. Both have its advantages and disadvantages, but which one is better? That really depends on where you live and your current condition.

We will also give you some standard glossary often used in a dental insurance. What is deductible and how does it work? What is copayment and coinsurance? What is maximum annual benefit? You will find all the answers here.

PPO VS Indemnity Comparison

Dental Insurance 101: PPO VS Indemnity Dental Insurance Plan

PPO PLAN

PPO stands for Preferred Provider Organizations. In a PPO dental insurance, the dental insurance company create a dental providers network. This network of dentists provides dental coverage and service on a reduced price. You can use other dentists outside of the network, but the service price is higher than dentists in the network. Usually there’s deductible, and the insurance uses copayment or coinsurance system. This type of plan is great for people living in cities or metropolitan areas, because there are many dentists who partner with several PPO providers.

INDEMNITY PLAN

In general, the indemnity dental insurance plan have more flexibility compared to PPO plan. There are no network used in this plan, which means you can go to any dentist you want. The plan uses reimbursement system, meaning that you may have to pay for the procedure up front first, and then the company will reimburse the cost. That said, there is a specific price platform used for each procedure. If you are charged more than that price platform, the insurance company will only pay the maximum price platform for that procedure. This plan benefits those living in rural areas or other areas with no PPO network available.

Now that you know the difference between PPO VS Indemnity plan, let’s learn a little bit more about the common terms in dental insurance.

DEDUCTIBLE: the deductible is the cost you have to pay before the insurance takes effect. For example, your dental procedure cost is $ 250, and your plan includes a $50 deductible. That means that you have to pay the $50 up front, and then the remaining $200 will be paid according to your dental plan’s agreement, whether it’s coinsurance or copayment.

COPAYMENT: The copayment or coinsurance means that both you and the insurance company cover the cost of treatment (after deductible) together. The percentage of cost paid by the insurance company depends on your dental insurance plan. As we have mentioned earlier, visiting in-network dentists is cheaper than off-network dentists because the insurance company have different cost percentage coverage policy for these dentists. You may have heard about 80/60. This term means that the company will pay 80% of the cost if you use in-network dentist services, and it will only pay 60% of the cost if you use off-network dentists services.

There’s also the annual maximum benefit to consider. The annual maximum benefit is the maximum amount of money that the insurance company is willing to provide. For example, you have a complex dental care procedure and it costs you $1,500. Your insurance plan’s annual maximum benefit is $1,000. This means that you have to pay $500, and you’ve spent your benefit for that calendar year. Further costs will not be covered.

I think that is enough. Learning everything about your dental insurance is very important. Hopefully this PPO VS Indemnity dental plans comparison can help you learn more.

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