Private Third Party

Prepayment Plans

SUBMITTED BY
ABHISHIKTH ABRAHAM VARGHESE
MECHANISM OF PAYMENT FOR DENTAL CARE

 Private fee for service

 Post payment plans
 Private third party prepayment plans
a) Commercial insurance plans
b) Non profit health service corporations(delta dental plans and blue cross)
c) Prepaid group service
d) Capitation plans
 Salary
 Public programmes
Definition

 Payment for service by some agency rather than directly by the beneficiary of these
services
 The dentist and the patient are the first and the second party and the administrator of
finances is the third party
 As the party to a dental prepayment contract that may collect premiums assumes financial
risks, pay the claims and provide administrative services
 the third part is also known as the carrier ,insurer ,underwriter or administrative services
Insurance principles and dental care

 Earlier dental care was considered uninsurable by carriers .This reasoning was based on the
assumption that the very nature of dental need violated the basic principles of insurance.To be
insurable,a risk must,
a) Be precisely definable
b) Be of sufficient magnitude that if it occurs,it constitutes a major loss
c) Be infrequent
d) Be of an unwanted nature
e) Be beyond the control of the individual
All health insurances violates some of these principles,since illness is not predictable for the
individualand health care is usually a wanted service
Insurance companies have found out that dental insurance can be made more feasible by ;
 Have patient share the cost
 Limit the range of service available
 Offering services only to group
 Including “waiting period” after enrollment before benefits become payable
- Use preauthorization and annual expenditure limits
Different types of payments offered by the
insurer are

 Deductible – it is a stipulated flat sum that the patient must pay toward the cost of
treatment before the benefits of the programme go into effect.it is called front -end-
payment
 Co-insurance- it is also called” co payment “.it means the patient pays a percentage of
the total cost of treatment. insurance carriers limit the range of health services
covered ,this is termed limitation of benefits
 Group insurance – this is health insurance only offered to groups. this is because illness
experience is reasonably predictable in a group
Reimbursement of dentist in prepayment plans

 Usual fee : Usually charged for a given service by an individual dentist to

private patients.
 Customary fee : A fee is customary when it is in the range of the usual fee charged by
the dentists of similar training and experience of the same service with in the specific
and limited geographic area.
 Reasonable fee : A fee is reasonable if it meets the above two criteria.
 Table of allowances:Is defined as a list of covered services that assigns to each service
a sum that represents the total obligation of the plan with respect to payment for
such services but that does not necessarily represent a dentist’s full fee for that
service
commercial insurance companies

Characteristics:
 They can be more selective about the group to which it chooses to offer dental insurance
 They claim no obligation toward the dental health of the community
 They sometime arrange an indemnity program that provides specific cash payment
reimbursement for specified covered services
 Commercial insurance companies organize their levels of reimbursement differently
 Commercial companies do not conduct fee audits andpost treatment dental examinations
 Non profit health service corporation
BDELTA DENTAL PLANS
LUE CROSS BLUE SHIELD
ASSOCIATION
DELTA DENTAL PLANS

 DELTA DENTAL PLANS is synonymous with Dental Service Corporation.

 Legally constituted Non –profitable organization incorporated on a state by state
basis
 Sponsered by a costituent dental society to negotiate and administer contracts for
dental care.
 Subjects to the insurance laws of the state in which they are constituted.
 The underlying philosophy of Delta Dental Plans is the dentists can adapt their
traditional patterns of practice to meet the group purchase of dental care.
CHARACTERSTICS OF DENTAL
SERVICE CORPORATION:

 Professional sponsorship
 Non profit operation
 Participation permitted by all licensed dentists
 Benefit provided on a service basis
 Freedom of choice allowed for both patient and dentist
REIMBURSEMENT OF DENTIST

 Reimbursement of dentist is done according the UCR concept

 It depends on whether the dentist is participating or non participating in the plan
 PARTICIPATING DENTIST:
Is any duly licensed dentist with whom delta dental plan has a contractual
agreement to render care to covered subscriber
CONDITIONSCONDITIONS: -
 PREFILING OF THEIR USUAL AND CUSTOMARY FEE
 PAYMENTS AT 90TH PERCENTILE
 CONDUCTS FREE AUDITS BY AUDITORS FROM DELTA PLAN, WHO MAY CHECK THEIR
OFFICE RECORDS FROM TIME TO TIME.
 POST TREATMENT CHECKUPS TO MONITOR THE QUALITY OF CARE.
 WITHHOLDS SOME MONEY , WHICH GOES TO DELTA CAPITAL RESERVE FUND
 NON PRTICIPATING DENTIS
 Treats patients and are paid at a considerably lower percentile than 90th, often at
median or 50th percentile.
 No prefiling of fees and not subject to fee audits
90 th PERCENTILE
BLUE CROSS BLUE SHIELD
ASSOSCIATION(BCBSA

 Offers limited dental coverage as apart of medical/ surgical/ and hospital polices
 Dental coverage are usually limited to services provided in hospital.
 Has similar cost control features pioneered by delta plans
PREPAID GROUP
PRACTICE
DEFINITION

 Group practice is that type of dental practice in which dentists , sometimes in association
with the members of other health professions agree formally between themselves on
certain central arrangements designed to provide efficient dental health service”
ADA(1969)
TYPES OF GROUP PRACTICE

 General practice groups composed entirely of general practitioners

 Single speciality groups where all members of the group are of the same speciality
 Multi speciality groups where certain practitioners in two or more speciality fields of
practice
Advantages of the dentist in group practice

 It provides better ways of organizing ones life

 There is less disruption in the practice caused by illness to a dentist
 Quality of care can is said t be improved because of the built in peer review
 Financial fringe benefits such as sick leave and pension plans can be built into a group
organization more readily
DISADVANTAGES

 Dentists should be compatible with each other

 Most group practice treat patients on the traditional fee for service basis and only a few
administer prepaid programs
 Group practice may operate as open or closed panels
 Closed panel- in closed panel, the patients eligible for dental service in a public or
private programme can receive this services only at specified facilities from a limited
number of dentists. A physician who participates in a closed panel cannot see patients who
are not concerned with the organization
 Open panel– in open panel the patient can go to any health professional of his choice. A
physician who participates in an open panel is free to see patients who are not connected
with the organization.
HEALTH MAINTENANCE ORGANIZATION

 An HMO is defined as a legal entity which provides a prescribed range of health

services to each individual who has enrolled in the organization in return for a
prepaid , fixed , and uniform payment
 Members of HMO are those people who join the HMO through a contract arrangement
in which the enrolled agrees to pay a fixed monthly or other periodic payment to the
HMO .enrollees agree to use the HMO as their principal souce of health care if they
become ill or need care
CAPITATION PLANS
 The basis of capitation is that the contracting provider whether an HMO , group
practice ,IPA or individual dentist receives an established ,negotiated sum on a monthly or
yearly basis for each eligible patient
 The money is paid regardless of whether the patient utilizes the care or not. In return the
patient is entitled to receive a prescribed set of services over a specified period
 Many of this plans offer only limited services and may be more saleable to participating
dentists because the risk involved is low.
THANK YOU