Last week, I attended a focus group put on by an independent research group contracted by my dental insurance company (one of the larger ones in the state). The gist of it was that the insurance company was considering offering ways for consumers to find out more information about dentists and their practices that might be beneficial to the consumers in choosing their dentist, such as size of practice, scope of services offered, and out-of-pocket costs for specific procedures (fillings, crowns, root canals, etc.) beyond what the insurance covers. They wanted our opinions on which criteria we thought would be most important to us.
When it came to the out-of-pocket costs, I said I was puzzled. Why would the insurance company want to provide us with information which we could use to compare the cost of one dentist to the next? No dentist here charges less than what the insurance will cover for a procedure. The insurance company will not save money by me choosing a cheaper dentist, as they’ll still be paying the dentist the negotiated rate regardless of how much over that I have to pay. At this point, the focus group leader said that she thought, but didn’t want to say it to us as fact, that the dentists do indeed receive differing amounts from this insurance company for the same procedure, based on how much the dentist charges, and would it matter to us to know what those rates were, dentist by dentist. I questioned that, as I assume that, as with doctors, reimbursement rates are set by the insurance company across the board. She said she didn’t think that was the case here, but wasn’t really supposed to talk about that, and moved on to a new topic. The issue was never cleared up. I assume she later got a talking to for veering off the script, and I assume that she was mistaken. Or was she?
So, my questions are:
Is it possible that different dentists under my insurance company are reimbursed at different rates based on how much they charge for each procedure? I can’t see any other reason for providing patients with cost information, but it doesn’t seem possible. There would be no incentive for a dentist to charge a lower rate if they’ll be reimbursed for a higher one.
If not, if they’re all reimbursed at the same rates, what benefit is it to the insurance company if I go to a cut-rate dentist or a ridiculously expensive one, as they’re still reimbursing them the same amount of money either way? Are they just doing it to be great guys since they really only have the consumers’ interests at heart?
Assuming everything you say is correct (I’m not saying that it’s not, I’m just assuming that it is), I think that (according to you) there is basically a floor for the cost of a specific procedure. So, a cleaning is $100, but that’s not to say that another dentist won’t charge $120 and a third might charge $175. I’d like to know that info. I think the insurance company is just trying to give you more information, more ways to compare dentists. Maybe it doesn’t mean anything to them one way or the other, but it’s a service they are considering providing their clients with. Similarly, I doubt they really care which dentists do can do head CT’s in house and which ones send you away for that, but again, more info. Perhaps they’re just trying to become the goto place for when you’re looking for a dentist. The more people that go to their site, the more business they can get. Right now they are trying to figure out if these are things you really care about, or would want to see in one place on the internet.
Other then that, I’m not really sure. Doing something like this is likely to make the dentists more competitive in their pricing, but as you say, they still likely won’t go below what the insurance company will reimburse them for…unless the insurance company is looking to reimburse them less. If they can get most of the dentists to charge the minimum maybe they can try to lower how much they reimburse for.
Yes, it is entirely possible, for dentists or any other health-care providers. How likely it is depends on a number of factors.
For instance, a large, multi-specialty operation that the insurance company wants to have on board can get better reimbursement rates than one guy starting his own business. Someone providing a service so specialized that no one else around does it might be able to get a better reimbursement rate. It’s not a matter of “incentive”, it’s a matter of how much you can convince the insurance company to pay for your services.
Some insurance companies base their reimbursement rate on provider charges. A lot of them (I’d say most) don’t, they just set rates at whatever they decide and it has little or nothing to do with what is charged. I know of at least one office that called all providers in the area and checked prices for a couple of procedures, because the insurance company was claiming that their rates were based on “usual and customary” charges for the region. I don’t know where the company got their info, but it bore no relation to reality.
I doubt it really matters that much to the insurance company. I’d guess that they’re trying to provide their customers with better information - some people will want a cut-rate dentist, some will want the most expensive guy in town. Customer service has become very popular with the bad economy. It’s relatively inexpensive and has a great ROI.
And yes, she probably was not supposed to be talking about that. Insurance companies are VERY VERY careful about reimbursement rate information. They do NOT want anyone to know how much the various providers are getting paid. Because then all the guys who are getting screwed would want more money.
Every dental insurance I’ve ever had charges for things other than routine cleaning and xrays on a percentage basis.
So, for example, they might cover a “gingevectomy” (cutting away part of the gum) at 80%, and a crown at 65%.
If your dentist charges $1000 for a crown, and they cover 65%, you pay $350
if your dentist charges $100 for a crown, and they cover 65%, you pay $35.
This is why it is relevant how much your dentist charges IF you ever require something more than the routine work which is fully covered beyond the co-pay.
But for almost any insurance, participating doctors aren’t allowed to charge whatever they want for a procedure; they’re able only to charge the rate specified in the insurance contract. So if you have brand x insurance, and you have five different dentists who all accept it, they’ll all charge you the same for the same procedure.
This is not my experience at all with dentists & dental insurance. It seems to work completely differently than medical insurance. My insurance has always paid a percentage, regardless of what the dentist charged. On some occaisions, they will cover less, if they believe the rate charged is wildly above “usual and customary” but the difference is made up by the patient, not swallowed by the doctor.
Crown: Customary: $200
Crown: My dentist: $300 (he has a CAD-CAM setup and manufactures it on the spot - no second visit)
Insurance: Pays 85% of $200 = $170
I pay: $130 (overage beyond R&C costs, plus uncovered percentage)
and they often would not cover an service that, in their opinion was done too frequently (for example, they will not cover 3 cleanings/year, even if the dentist believes it is medically indicated - they will cover 2 cleanings per year, period).
Any chance they could be doing this because it’s hard to find an in-network dentist? We use an out-of-network dentist and pay the difference between the in-network allowance and what the dentist charges. Say a cleaning costs 100 dollars but the allowed rate is 80, and the insurer pays 80% of that or 64 dollars. We have to pay the dentist the difference, or 36.00. Another dentist who charges 90 would get the same reimbursement, but we’d own him/her only 26.00.
I assume it works like this, from my experience in Canada:
Dental association publishes “recommended” fee schedule.
Dentist charges whatever they want.
Many dental plans publish a fee schedule too - “this is what we will pay for this procedure.”
Dentist charges overage to patient, or charges insurance company less than their rate (yeah right!)
In most of the plans in the small town I worked in - several large companies and various government employees - the dentists charged the plan fees. Employees expected their plan to cover all costs of basic procedures - cleaning, minor fillings, etc. The first guy to charge an extra fee would lose patients. It was somewhat self-regulating.
OTOH, the Canadian federal Indian Affairs department was in a world of its own somewhat divorced from reality, as bureaucrats can be when their actions don’t impact themselves. They set the IA fee schedule much lower than Blue Cross or the Dentists’ own association. Since many natives were on welfare and so were difficult to collect from, the dentists eventually came up with a policy that they would not treat people under IA’s plan without a cash payment up front of the difference. They had a line-up of other customers and did not mind losing the business. Once the chiefs complained to IA and especially to the media, it only took a year or two of task forces and meetings and studies and reports before they raised their rates to match reality.
I suppose if Blue Cross or whoever did not pay what most dentists concsidered a fair rate, the insured would complain to the HR department. Then a company with several thousand people covered would ask Blue Cross “why are we paying you for a 100% coverage plan if it’s only an 80% coverage plan?” If BC can point to the dentists association fee schedule and surveys of random dentists across Canada and say “see, our fees are at the typical 100% level” then they might have a stronger case.
With extras - This is the same problem as the US health insurance system. Braces or dentures or similar are covered 50%, say. But I have NO IDEA what the total price will be; it’s not like Walmart vs. Target, where identical items are laid out and I can choose $79.95 vs. $65.56 and pick it up right away. Plus, other factors like “this guy is gentler and uses anaesthetic better” or “she’s a pleasant person to go to” probably play as much of a factor as price. I doubt many of us go out of our way to spend extra money at the dentist, even if it’s “free”, and I certainly wouldn’t skip the 6-month cleaning just to save the insurer a few dollars.
However, I think it’s good PR for the insurer and the employer to have me realize just how much they are shelling out. It’s goodwill for them if I realize they shelled out the equivalent of an extra paycheque to my dentist on my behalf. Plus, it helps if I look at the statement; at least someone may notice if there are extra treatments they don’t recognize. It’s a good fraud prevention measure.