Does it make sense for families to have two dental insurance plans?

Every policy has patient cost-sharing features such as deductibles, co-insurance, and annual maximums. A family with ongoing oral care needs can easily pile up large unreimbursed expenses even after their original plan pays the claims.

It could make financial sense for parents to own dual plans, which raises another question.

Is it better to purchase a supplemental or a secondary dental insurance? Yes – there actually is a difference. Choose wisely. This breakdown can help you decide which works best for you.

  1. Key differences between secondary and supplemental insurance
  2. Rules driving the coordination of benefits between two programs
  3. Implications for Medicare & Medicaid recipients and individuals
  4. Pre-existing condition waiting periods for implants and orthodontia

Secondary versus Supplemental Dental Insurance

All auxiliary dental insurance plans do not work the same way. Each variety offers unique features that affect how much the patient must pay in premiums and receive back in claim payments when they own two policies.

The dictionary definition of the two terms conveys a slightly different meaning that can have a big impact when put into practice.

  1. Secondary: the next after the first in order, place, or time
  2. Supplemental: added to furnish what is lacking or missing

Both options make financing programs work effectively. Borrow less upfront, and have a third party cover a portion of future expenses.

How Two Types Work

The way each alternate dental insurance type works follows these definitions and has unique implications related to three key features.

  1. Coordinate benefits mean that the alternative plan makes claims payments to reduce the unreimbursed expenses not covered by the first up to 100% of the allowed charge.
  2. Network dentists mean that participating practices agree to accept the pre-negotiated “allowed amount” for a service as payment in full.
  3. Claims payment determination means how the insurance company decides how much to pay for a covered treatment or procedure.
  4. Type of ownership means that an employer group or an individual person controls what happens with the policy.
SupplementalSecondary
Coordinate BenefitsNoYes
Network ProvidersNoYes
Claim PaymentFixedVariable
Individually OwnedAlwaysSometimes

Extending the annual maximum amount is one reason to own two policies. Follow along as we apply these four basic points of distinction to illustrate which version fits best for your family.

Primary vs Secondary

The rules for primary versus secondary dental insurance apply when a family has two traditional plans that include the three basic elements.

  1. Coordinates benefits with another policy
  2. In-network dentists accept the “allowed amount”
  3. Claims payments vary based on network and coordination rules

Some families have two traditional plans when the husband and wife have employer-based offerings. Some employers pay a large share of the premiums, so it makes sense to keep both. Each alternates priority order depending on the patient.

Husband OwnerWife Owner
Husband PatientPrimarySecondary
Wife PatientSecondaryPrimary

The birthday rule determines which plan pays first and then next when a dependent child needs oral care. The parent whose birthday falls earliest in the year is first. The parent with the later birthday is next in line and coordinates benefits with the first.

The rules for primary versus supplemental dental insurance work differently. The ancillary program works independently of network participation and claims paid by the first payer.

  1. Does not coordinate benefits
  2. Use any dentist regardless of network
  3. Fixed claim amount for each ADA procedure code

Medicare Recipients

Supplemental dental insurance for Medicare recipients has a misleading name. It acts more like primary or secondary coverage, rather than a true supplement. Issuing companies and seniors over the age of 65 lump them into the same category for convenience and simplicity.

Medically necessary oral care is part of Medicare Parts A and B. This includes treatments resulting from non-biting accidents, and certain diseases affecting the mouth. However, it does not pay for any traditional oral care.1

Medigap Policies

Seniors frequently enroll in Medigap policies when turning age 65 to reduce exposure to future medical expenses. These supplemental medical insurance plans have precise boundaries.

Do CoverDo Not Cover
Healthcare Services

·         Copayments

·         Co-insurance

·         Deductibles

·         Long-term care

·         Vision or oral care

·         Hearing aids

·         Eyeglasses

·         Private duty nursing

Therefore, any dental coverage added to a Medigap policy would be primary as nothing else pays for traditional oral care.

Medicare Advantage

Seniors citizens can also elect to enroll in Medicare Advantage (Part C). Advantage plans provide all of your Part A (medical) and Part B (hospital) while also reducing out-of-pocket costs. Most also embed extra assistance for vision, hearing, oral care, and wellness programs.

Therefore, any dental insurance added to a Medicare Advantage plan is either supplemental or secondary. It depends on the exact design of the extra policy regarding coordination of benefits, network participation, claims determination, and ownership.

Medicaid Recipients

Low-income families who are Medicaid recipients should proceed cautiously before buying extra dental insurance. While nationwide and federally funded, this safety-net program offers a wide array of oral care assistance in each state.2

  • Medically necessary oral care for adults is available in all 50 states.
  • Comprehensive oral care for adults on Medicaid is different in every state. Each has unique rules for preventive, restorative, periodontal, oral surgery, and other services.
  • Comprehensive oral care for children in all 50 states is uniform.

Low-income families should be careful not to duplicate Medicaid coverage. Duplication is okay when the employer funds the premium. However, companies rarely offer to pay a significant portion of the premium for entry-level, part-time, and low-wage employees.

Individual Coverage

Buying secondary dental insurance as an individual is a common strategy. However, a supplemental plan will usually be more affordable and offer better value to patients shopping privately for additional help.

It is difficult to match network providers with backup individual coverage.

  • All providers would need to participate in both networks
  • Any provider accepts payment from a supplemental company regardless of network

Both additional individual policies may cost about the same. However, the claim payment amount a patient might see in return favors one over the other.

  • Coordinating benefits could reduce claims payments on the secondary by 50% or more. The combined payment will never exceed 100% of the allowed charge.
  • Supplemental plans do not coordinate benefits and always pay 100% of the stated amount. The combined payments will exceed 100% of the allowed charges in some cases.

How Alternate Dental Insurance Works in Practice

There are times when one type of extra dental insurance plan will work better than another does. The place where a person purchases the added program is the biggest factor. The effect on waiting periods determines claim payments for implants and orthodontia.

  1. Secondary dental insurance value varies based on place of purchase
    1. Group coverage obtained at the worksite has pros and cons.
      1. Employers may fund a portion of the premium
      2. Pre-tax elections on the employee share of premiums reduce taxes
      3. Often covers pre-existing conditions immediately
      4. Begins only during open enrollment
      5. Limited availability as employer must offer
    2. Individual coverage has different selling points
      1. Greater availability since many employers do not offer
      2. Lower out-of-pocket costs for in-network providers
    3. Dual coverage sometimes solves the waiting period dilemma
  2. Supplemental dental plans have a unique proposition
    1. Use any dentist in-network or not
    2. Claim payment certainty based on a published schedule

No Waiting Period

Finding additional dental insurance with no waiting period for a pre-existing condition is tricky. Buying any plan for immediate use for a pre-existing condition is the opposite of insurance (claim payments for any unknown future peril).

  • Secondary dental insurance waiting period rules vary by purchase channel.
    • Group policies cover pre-existing conditions with no waiting period. However, the employee can begin only during an open enrollment period determined by the employer.
    • Individual policies may wave waiting periods for pre-existing conditions if you can show evidence of prior creditable coverage. You already have something in force, making this option ideal for this common problem.
  • Supplemental dental insurance contains discrete waiting periods for all procedures regardless of when the condition begins. The length varies by procedure type (preventive, restorative, major services).

Covering Implants

Ancillary dental insurance covering implants works in a similar fashion. Patients needing permanent tooth replacement often begin looking for extra help only after the need arises. Therefore, waiting period rules determine how each option works for this treatment.

  • Secondary dental insurance covers implants in unique ways
    • Group policies cover immediately
      • Subject to open enrollment limitations
      • Coordinates (reduces) benefits with the first
    • Individual policies also cover
      • With waiting period for preexisting conditions
      • Reduces (coordinates) benefits with the first
    • Supplemental dental insurance covers implants differently
      • Waiting periods for all tooth replacements
      • Full fixed payment per published schedule

Covering Braces

Alternate dental insurance covering orthodontia (braces) also works in the same way. Once again, many parents begin looking for extra help to pay for braces (adult and teenagers) when the need is right around the corner.

The need to straighten teeth using orthodontia should not come as a surprise. Therefore, parents should act accordingly and make the best choice given timing considerations.

  • Secondary dental plans cover braces in unique ways
    • Group policies offer coverage
      • Subject to open enrollment limitations
      • Coordinates (reduces) benefits with the first
    • Individual policies also cover
      • With waiting period for crooked teeth
      • Reduces (coordinates) benefits with the first
    • Supplemental dental insurance covers orthodontic treatment
      • Waiting periods for alignment of crooked teeth
      • Full fixed payment per published schedule

Footnoted Sources

  1. Medicare rules
  2. Medicaid rules
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