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HMO insurance is actually a misnomer.
It's not an insurance plan, it's more like a discount membership plan.
HMO "insurance" plans don't pay dentists for treatment. They simply
mandate a lowered fee that the patient pays.
This is a huge cost-saver to
insurance companies because their pay-out is tremendously reduced when
compared to PPO plans and especially indemnity plans. Basically,
instead of the patient and insurance company splitting the bill, it
is now the dentist and the patient splitting the bill. The result
is that much or most treatment is performed at a loss to dentists.
Here's how it works:
The HMO company subscribes a
group of patients and contracts with a few dentists. They require
that every patient member select a single dentist or dental office from
their list. The HMO company pays each office a few dollars per
month, usually $2 or $3, for each patient that selected their office.
That payment is made whether the patient even went to that office or
not.
For example, let's say an HMO
company has 1,000 patient subscribers. Out of those 1,000 patients,
300 chose office A, 300 chose office B, and 400 chose office C when they signed up for their HMO plan.
At $2 per patient, office A gets $600 per month, office B gets $600
per month, and office C gets $800 per month. This is called a
capitation fee, it's like a membership fee the dentist gets every month for patients that chose that office on their plan.
Out of the 300 patients that
chose office A, let's say 60 decided to visit the dentist during the
month. For those 60 patients, the dental office is required to
provide many services such as examinations, x-rays, cleanings, and silver
fillings at NO COST. The patient does not pay for these services,
nor does the HMO company. The $600 monthly capitation fee is meant
to cover the dentist's costs for those free services. Whether
it actually does is another story.
When it comes to major treatment,
like crowns, bridges, and dentures, the patient pays a highly discounted
fee. The HMO company pays nothing. It's the dentist that
pays the majority of the bill. Because of this, the lowest quality
treatment option is the one that's covered.
For example, if a patient needs
a crown that normally costs $800, their fee might be $200 under the
HMO plan. But for that fee they can only receive a stainless
steel crown, not a porcelain crown. They must pay for upgrades
if they want a higher quality crown, with gold, or porcelain, or cosmetic
edges.
Let's say the total fee with
porcelain comes to $350. For a dentist to do an $800 crown for
$350 and not go bankrupt requires special skills and talent. Furthermore,
if a dentist or dental office has not developed a moral and ethical
way to cut costs and deliver $800 crowns for $350 and stay in business,
then they have no motivation to diagnose and perform treatment.
Remember that Glendale Dental
Arts, and John Gazarian, DDS, have been a dental landmark in the city
for nearly 25 years. In our office we've seen the results of the
changing trends in dentistry and the impact dental insurance has had
on the quality of dentistry throughout the surrounding communities.
More and more, patients come
to our office with deteriorating dental health, having received inadequate
dental treatment from dentists attempting to treat a tooth for less
than half the price that's needed. Much of the dentistry we perform
is reparative dentistry, fixing problems created by prior dental work.
In the 70's and early 80's, indemnity
insurance plans provided access to high quality dentistry to many people.
But as trends changed, and HMO companies took over the market share,
the quality of dental treatment has declined. Since HMO plans
don't pay for treatment, patients are often surprised at their bills,
even if it's only $350 for an 800 dollar crown.
Combine that with the fact that
you can find a dental office on every corner, near liquor stores and
99 cent stores, the perceived value of dentistry has declined over the
past 15 years tremendously. In the past, people had budgets for
medical and dental costs. Now, that money is spent on electronics,
and few people ever think it's necessary to save up for something they
can get next door to a 99 cent store.
The HMO companies are happiest
when they have the most subscribers. And in general, patients
are happiest when they are paying the lowest fees for what they think
is dental insurance. This is sad, because the results are a steadily
decreasing level of dental health for everyone.
As we work to reverse the trend
of low quality dentistry, we need your help. As a well-read patient,
we ask that you help spread the word. First, understand how important
it is to choose your dentist and dental insurance carefully. Then help others respect and understand the current state of dentistry as much as we and you.
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