Dental Insurance Terminology Explained

Is this you when someone mentions deductibles and coinsurance? Have you ever wondered what exactly in-network and out-of-network mean, especially to your pocketbook? Here’s a fairly short and sweet post on some dental insurance terminology to help you be an informed patient.

Yearly max – Also known as the annual max, this is the maximum dollar amount that your insurance company will pay for in benefits each policy year.

Policy year – Typically your benefits will “reset” at the start of each policy year and typically a policy year is a calendar year, meaning it runs from Jan 1 – Dec 31. However, a plan can start at any time.

Deductible – This is the amount that your insurance company requires that you pay before it starts paying for benefits. The deductible is applied to certain procedures based on your plan. Depending on your plan, you may or may not have to pay the deductible on your first visit.

Copay – Also known as coinsurance, this is the amount, typically a percentage, that you pay out-of-pocket.

Waiting period – A specified period of time, from your effective date, that you have to wait before insurance will start providing certain benefits.

Negotiated rate – Also known as the contracted fee, this is the amount that the insurance company negotiates with the healthcare provider for each procedure that is covered by the plan.

Covered – If a procedure is covered by your insurance, this means that the insurance company will pay a certain percentage for the procedure, and you will pay the remainder, if any, out-of-pocket.

Not covered – If a procedure is not covered by your insurance, this means that you pay for it 100% out-of-pocket.

In-Network vs Out-of-Network – Just because a healthcare provider accepts your insurance plan does not mean that you are in-network with that provider. It simply means that the healthcare provider’s office will accept your insurance and often file your claim on your behalf.

If you are in-network with a provider, this means the provider has a contract with the insurance company and, thus, you can take advantage of the lower, negotiated rates. If you are not in-network, you cannot take advantage of these reduced fees, and you will most likely be charged the standard office fees. Also, in many cases, your benefits may be reduced if your provider is out-of-network.

For example, if your provider is in-network, you may have a $2000 annual max; if your provider is out-of-network, you may only have a $1500 annual max. If your provider is in-network, your insurance may cover fillings at 80%; if your provider is out-of-network, your insurance may only cover fillings at 50%.