How Does Dental Insurance Work?

Updated · Mar 06, 2023

Dental insurance is much simpler than medical insurance.

Most policies state clearly what procedures they cover and how much you have to pay out of pocket.

While the conditions vary from provider to provider, some of the terms are universal.

Read on to find out:

  • How does dental insurance work?
  • What does it cover?
  • How to choose and buy a plan?
  • and more

What Is Dental Insurance?

Dental insurance helps cover the cost of dental care. Typically, it isn't part of healthcare policies.

You can purchase it separately, as a rider, or use your FSA or HSA funds to reimburse the expenses.

At the base level, it works like medical policies. You pay premiums, and the insurance company covers the qualified medical expenses.

That said, there are some key differences.

How Does Dental Insurance Work?

To help you understand how it functions, we walk you through the main components of dental insurance.

Network Coverage

Insurance companies have a network of providers.

Some companies allow you to go to an out-of-network dentist. If you already have a dentist you trust, you may prefer to visit them even if they're not in the network.

However, keep in mind that this will cost you more. The cheaper option is to choose an in-network dentist.

Waiting Periods

Most dentist insurance plans have a long waiting period—usually 6-12 months. During this time, you're responsible for the full cost of your dental care.

That way, providers ensure they make a profit from policyholders before they start paying out the benefits.

What’s more, the aim of dental insurance coverage is to help with preventive care and unexpected expenses.

So, providers want to discourage people from buying a policy only because they need treatment urgently.

Annual Maximums

Most dental policies limit the amount of coverage they provide each year. This is usually between $1,000 and $2,000.

If you reach that threshold, you will have to pay for all costs.

Tax Credits

If your policy does not include children's dental care, you can use tax credits to pay for dental insurance.

If you are using an HSA or FSA to pay for your premiums, you won't get another tax deduction. The money in these accounts is already tax-free.

Out-Of-Pocket Expenses

There are three types of out-of-pocket costs associated with dental coverage: coinsurance, copayments, and deductibles.

A deductible is an amount you must pay out-of-pocket before your insurance policy kicks in.

Copays are a fixed cost you owe every time you visit the dentist or another specialist. Not all policies require that.

And finally, coinsurance is the percentage of the bill you're responsible for after the dental deductible is met.

Most providers cover only a percentage of the costs remaining after you've paid the deductibles. The range is huge—from 20% to 80%.

The amount you'll have to pay out-of-pocket varies depending on the provider and the types of procedures covered.

Let's see what they are.

What Does Dental Insurance Cover?

Most providers use the 100/80/50 payment structure.

They divide the type of care into three groups—preventive, basic, and major—and cover 100%, 80%, and 50%, respectively.

Preventive care includes things like:

  • Annual checkups
  • Cleanings
  • X-rays

In this case, dental insurance covers 100% of the costs.

Basic procedures are:

  • Fillings
  • Extractions
  • Root canals

Typically, you have to pay only 20% of these expenses.

And lastly, major procedures include dentures, crowns, bridges, and so on. Many providers cover only 50% of these costs.

Dental insurance policies don't cover cosmetic procedures, like teeth whitening.

Some may include orthodontic work, such as braces, but they are harder to find.

Does Health Insurance Cover Dental Care?

Most standard health insurance policies don't include dental coverage.

Obamacare covers dental treatments.

The Affordable Care Act defines them as essential for those under 18. That said, insurance companies are not required to include dental services in their plans for adults.

Still, if you want to get insurance with dental and medical coverage, there are plenty of options.

Some providers offer combined plans. Alternatively, you can get dental care as a standalone package or as a rider.

Finally, if you have an HSA or FSA, you can use the funds in them for dental care.

How Do I Get Dental Insurance?

There are two main types of policies. Here’s the difference between them.

Dental Maintenance Organizations (DMO)

DMO plans connect you with a network of providers. If you choose one of the in-network specialists, you can get a dental insurance plan with discounted rates.

Although that's the cheaper option, it limits your choice of a specialist.

If you want to stay with your dentist, but they're not part of the insurer's network, you can get PPO insurance with dental coverage instead.

Preferred Provider Organizations (PPO)

Most PPOs have a network of contracted providers. You can pick any of them. When you need to see a specialist, you don't need a referral from your doctor. This is true whether the specialist is in or out of the PPO's network.

Wrap Up

Dental insurance is confusing. But it doesn't have to be. In this article, we've broken down the basics for you.

We've answered the questions:

  • How does dental insurance work?
  • What does it cover?
  • How to get a plan?

Now all that's left is for you to choose the policy that fits your needs.

Aleksandra Yosifova
Aleksandra Yosifova

With an eye for research, Aleksandra is determined to always get to the bottom of things. If there’s a glitch in the system, she’ll find it and make sure you know about it.