What is an PPO vs HMO vs an EPO also known as an ePPO? Do you know the difference?
Three Little Letters Make a Huge Difference in Care
Insurance is confusing and what I’ve found is that no one takes the time to explain to people what they are buying or, if your employer is providing the benefit, what the terms of that benefit is. This includes the three little letters at the top of your card because the different types of plans can have a huge impact on who you are allowed to see, what the insurance will pay, and the type of office you can go to.
The PPO is the Most Common and Most Flexible Type of Dental Insurance
By far the most common type of dental insurance is PPO. We often get the question “do you take my insurance?”, and if your insurance is a PPO type insurance, the answer is YES and it will be a YES for 99.9 percent of the offices out there whether they have a contract with that insurance company or not.
With a PPO type plan, you have the freedom to choose whatever dentist in whatever office you want and your insurance will pay something towards that visit. Depending on the cost of the plan and what your employer has negotiated with the insurance company that coverage can vary by a lot. Even if two people both have a Metlife plan, one person could see most, if not all, of their visit covered. Whereas the other person might only have 50% of their visit covered. Either way, nearly every dental office will file the claim for you and the insurance check will either be sent to you, or the office will collect the insurance check as payment for your visit.
HMO Dental Plans Have the Most Restrictions
An HMO is at the complete opposite end of the spectrum. With an HMO type plan you not only have to see an in-network dentist, but the specific in-network dentist assigned to you no matter where the office is or how much you like them or not. This is because unlike a PPO type plan where the dentist gets paid based on the procedures done, an HMO plan gives the dentist a small monthly payment, say $20 a month for each HMO patient assigned to their office. In exchange, the dentist agrees to do certain procedures for “free” – well not completely for free since they are getting paid monthly – but nothing additional charged out to the insurance company or the patient beyond perhaps a copay for covered procedures.
This can lead to a lot of issues, including difficulty scheduling an appointment – if an office has a patient they are going to get paid for regardless of whether they see them or not, they are obligated but not really incentivized to get you in. Sometimes offices that rely on a lot of HMO insurance will also try to “upsell” non-covered procedures that may or may not be in the best interest of the patient in order to break even or make a profit. Afterall, a dental office is also a business that needs to cashflow. Most of the time this is done by taking advantage of the economies of scale that a large, high volume office can take advantage of. But the way the model is set up can incentivize some less than ethical behavior in some – NOT ALL but SOME – dental offices.
A New Type of Dental Plan to Watch Out For
There is a new type of dental plan on the market that is gaining traction called an ePPO or an EPO plan. It is getting more and more popular with employers and the marketplace and is a hybrid between a PPO type plan and an HMO plan. There isn’t a monthly payment the office gets like in an HMO, rather the dentist is reimbursed for each code or procedure done. However, for an EPO plan, you must see an in-network dentist to get any reimbursement at all. The list of dentists your insurance will cover is restricted to only offices that are “in-network”.
In-network means that the dentist has a contract agreement with the dental insurance company to discount their fees for people with this plan. Typically this discount has been about 30-40%, but more recently I’ve seen discounts of nearly 60%, making it more and more difficult to keep the finances of a dental office healthy unless the dental office does one or both of the following: either they have to see a large volume of patients meaning they don’t spend much time with each patient, or they start using cheaper materials and cheaper labs for their crowns. Many less expensive dental labs will outsource the manufacturing of their crowns to places like China. It’s an awkward conversation to let a patient know their crown is stuck in customs. I’ve had it happen at offices I’ve worked for before I bought my own practice.
I don’t want to say that all offices that are in-network with insurance are like this. Offices that have a lot of insurance contracts can still be great offices, I don’t want to play it like they’re not – for example older doctors don’t have nearly the same overhead as younger docs and never had the student loan burden that new dentists have to manage. Some offices don’t have insurance patients as a large enough portion of their practice to make that much of a difference. Some practices are startups that offer great service but are taking a lot of insurance in the beginning to have someone in the chair to cover the overhead of the new business. But I will say that it’s really hard to give the best with a lot of insurance contracts and it’s only getting more difficult as costs increase and insurance reimbursements go down.
Dental Care Plus Dental Insurance
If you have the Dental Care Plus insurance, your card will typically say DHMO at the top, but it works like an EPO or ePPO as discussed here. It will not reimburse you or your dentist if they are out of network.
Summing up the Differences
So to recap: if you have a PPO type insurance you have the most freedom to choose your dentist and can pick whatever style of office that you like. An HMO is the most restrictive type and you have your dentist assigned to you. And an EPO or ePPO means that if you want to use your benefits, you need to see someone in-network.
If you purchase your own plan off the marketplace or are considering purchasing one, realize that dental insurance maximums aren’t very high an often don’t cover the entire scope of treatment recommended for people who have put off dental treatment for many years. You may get more personalized care by choosing your dentist and asking about what kind of in-house financing they offer. Most dental offices offer CareCredit which is a credit card that can be used for health-related expenses and puts the cost into easy and affordable monthly payments.
If you have a more restrictive type of dental insurance that is provided by your employer, speak to your head of HR and ask what other options you or the company could consider to get more freedom to choose your dentist. Many HR personnel may not realize the restrictions of different dental plan types in relation to cost. You do have some power here.
I hope I cleared some things up regarding the different types of dental insurance plans out there – this is by no means an exhaustive list, but they are some of the most common. If you have any questions about your dental insurance, we’d be happy to take a look at your benefits. Give us a call at 513-241-1477 or email us directly at firstname.lastname@example.org. As always, thank you for listening and have a wonderful rest of your day!