FINANCE IN DENTAL CARE

FINANCE IN DENTAL CARE

Presented by:S.M.M.HussainiCONTENTINTRODUCTIONHealth care services traditionally have been provided on fee-for-service basis whereby the patient receives specific services and pays the provider for service directlyAs the costs of health care continues to rise, the majority of the people cannot afford dental treatment, especially when it is provided on a fee-for-service basis Methods have to be sought to ease costs either by legislature or by development of a variety of funding approachesDental personals owe it to themselves and to their patients to develop the clearest possible understanding of the social forces at work in this complex situation.3HOW DOES A DENTAL PRACTITIONERS RECEIVE PAYMENT FOR THEIR SERVICES?? PRIVATE FEE FOR SERVICEPOST PAYMENT PLANSPRIVATE THIRD PARTY PREPAYEMENT PLANSCommercial insurance companiesNon profit health service corporationPrepaid group practiceCapitation plansSALARYPUBLIC PROGRAM

PRIVATE FEE-FOR-SERVICE

The two party arrangement is the traditional form of reimbursement for dental servicesDentists overwhelmingly prefer to practice under this arrangement and this is considered as the most efficient way of providing dental careFee-for-service care is an integral part of private practicePRIVATE FEE-FOR-SERVICE(cont)AdvantagesIt is culturally acceptableThis system is flexible-fees can be changed in accordance with market conditions & dentist is also able to practice price discriminationIt is administratively simple- since dentist need not keep a written list of fees for procedureIt is only system under which some form of dental care likely will ever be providedIf PRIVATE FEE-FOR-SERVICE were only financing mechanism thenDespite the flexibility and price discrimination there are still some potential patients who cannot afford dental carePost payment plansAlso known as budget payment plans for individual purchase of serviceThe first step was to offer this service through an organized dental society plan were taken in late 1930s by local dental societies in Pennsylvania and Michigan

Post payment plansUnder the budget payment plan, the patient borrows money from a bank or finance company to pay dentist fee After the application is approved by leading institution the dentist is paid the entire fee The patient then repays the loan to the bank in budgeted amountPost payment plans(What actually happened)It was hoped that this plan would benefit large segment of population but they have not done Plan was used by middle earning group rather than in the lower income group The patients were associated with defaulted loans and low income patients would also have more difficulty being accepted as credit worthy by leading institutionsPrivate third party prepayment plansPayment for services by some agency rather than directly by beneficiary of those servicesThe dentist and patient are first and second parties and the administrator of finances is third party defined as the party to a dental prepayment contract that may collect premiums, assumes financial risk, pay claims and provide administrative services.The third party is also known as carrier, insurer, underwriter or administrative agent.Usually the term third party refers to a private carrier such as an insurance companyInsurance principles and dental careEarlier dental care was considered un insurable by carrier To be insurable a risk must Be precisely definableBe of sufficient magnitude that if it occurs it constitute a major lossBe in frequentBe of unwanted natureBe beyond the control of individualNot constitute a moral hazardInsurance company have found that dental insurance can be made more feasibleHave patient share the costLimit the range of services availableOffering services only to groupInclude waiting period after enrollment before benefits become payableUse pre authorization and annual expenditure limitDifferent type of payments offered by insurer are

Deductible:It is stipulated flat sum that patient must pay toward the cost of treatment before the benefits of program go into effectSome time called front end payment Different type of payments offered by insurer areCo-insurance:An arrangement under which a carrier and beneficiary are each liable for a share of cost of dental services providedE.g.: a patient has to pay 20% of the cost of hospital care the remaining 80%will be paid by insurance companyAlso called co paymentIt means that patient pays a percentage of total cost of treatmentInsurance carrier limit the range of health care services covered termed as limitation of benefitsIt helps in keeping premium down

Different type of payments offered by insurer areGroup insurance:Health insurance offered only to groupsThis is because illness experience is reasonably predictable in a groupThe probability of adverse selection is also reduced by use of waiting period after enrollment before any benefits become availableThe waiting period ensures that persons with existing diseases are not simply going to use their plan to have that disease treated out and then drop outReimbursement of dentist in prepayment plans The ADA has consistently supported the concept of Usual, Customary , and Reasonable (UCR) fee as the preferred method for reimbursement for dentist in prepayment plansApart from UCR fees the other only form offer is the table allowancesUsual Fee: the fee usually charged for a given service by an individual dentist to private patient i.e his or her usual fee Reimbursement of dentist in prepayment plans Customary fee: a fee is customary when it is in range of usual fee charged by dentist of similar training and experience for the same service within the specific and limited geographic areaReasonable fee: a fee is reasonable if it meets the above 2 criteria or it is justifiable considering the special circumstances or particular patient in questionReimbursement of dentist in prepayment plans A table of allowances:Is defined as list of covered services that assigns to each service a sum that represents the total obligation of plan with respect to payment for such service but that does not necessarily represent dentist full fee for that serviceIf the fee become more than that assigned to that service by the carrier the remainder will b collected by dentist from patientCommercial insuranceCharacteristics:They can be more selectiveClaim no obligations towards dental health of communityProvides specific cash payment reimbursement for specified covered servicesOrganize their levels of reimbursement differentlyDo not conduct fee audit and post treatment dental examination

Commercial insuranceThey can compete successfully because their expertise in promotion and marketing allows them to present attractive total health package plans to potential purchasersIn India Commercial insurance now started providing insurance for dental procedures which do not require hospitalization Non profit health service corporationsDelta dental plans:It is a legally constituted non profit organization incorporated on a state by state basis and sponsored by a constituent dental society to negotiate and administer contracts for dental careEarlier known as National Association of Dental Sciences Plans(NADSP)-1969The majority of the board of directors of delta plan are dentistsOther members represents the worlds of finance insurance and consumer groupsReimbursement of dentist in delta plansDelta dental plans almost exclusively use UCR conceptA participating dentist is defined as any duly licensed dentist with whom a delta plan has a contractual agreement to render care to covered subscribersThe dentist participating in the plan have to agree following conditionPre-filling of their usual and customary feesAcceptance of payment for their services at 90th percentile of fees as payment in fullFee audits by auditors from delta plan who may check their office records from time to time . The purpose is to ensure that dentist are indeed charging their delta plan patient the same fee as they charge their own patientPost treatment inspection of randomly chosen patient to monitor the quality of careThe withholding of a small amount of each fee to go into the delta capital reserve fund Non profit health service corporationsThe 90th percentile:Suppose in an area there are 1000 participating dentist their fees range from rs 50 rs 90 for oral prophylaxis then we plot a graph with the fees in the x-axis and percentile in y-axisThe percentile of data set divide the total frequency into hundredths so that 90th percentile is that value below which 90%of the observation liesThe figure shows About 10%dentist chargers rs 60 or lessAbout 50%dentist charges rs 65 or lessAbout 80%dentist charges rs 70 or lessAbout 90%dentist charges rs 78or less

Non profit health service corporationsBlue cross blue shield association:It is a federation of 38 separate health insurance organization and companies in USProvide insurance to 99 million AmericansHistory of blue cross in 1929History of blue shield in 1939The two organization merge in 1982These organization over years have provided limited dental coverage as a part of medical policiesPrepaid group practiceIt is the term given to a group practice that provides dental services on prepaid basis Such group are now generally regarded as open panelsGroup practice is that type of dental practice in which dentist some times in association with the members of other health profession agree formally between themselves on certain central arrangements designed to provide efficient dental health service -ADA 1969

Type of group practiceGeneral practice groups composed entirely of general practitionersSingle specialty groups where all the members of group of same specialtyMultispecialty groups where certain practitioners in two or more specialty field of practiceAdvantages for the dentist who practice in a group areIt provides better ways of organizing once life i.e. vacations and continuing education can be planned more readily because colleagues in the practice can temporarily care for a dentists patients during the timeThere is less disruption in the practice caused by illness to a dentist Quality of care is set to be improve because of built-in peer reviewFinancial fringe benefits such as sick leave and pension plans can be build into a group organization more readily thus easing the day to day economic concern of dental practiceHealth maintenance organizationa legal entity which provides a prescribed range of health service to individual who has enrolled in organization in return for a prepaid ,fixed and uniform paymentThe 4 principle that characterize an HMO areAn organized systemComprehensive health maintenance and treatment servicesAn enroll groupReimbursement Dental personnel in HMOs

Staff modelGroup modelIndependent practicing associationDirect contract modelStaff modelin this employees are salaried by HMOMay or may not be a dental director2. Group modelHMO contracts directly with group practice , partnership , or corporation for provision of dental service

3. Independent practice associationAssociation of independent dentist or physician that develops its own management fiscal structure for treatment of patient enroll in a HMO4. Primary care capitated networkSimilar to IPA except that HMO contracts directly with individual provider for provision of service

Caption plansThe basis of capitation plan is that the contracting provider whether an HMO group practice or individual dentist receives an established negotiable amount monthly or annually basis for each eligible patientThe money is paid regardless patient utilizes care or notIn return patient is entitled to receive a prescribed set of service over a specific period

SalaryDentists in some group practices, those in the armed forces and those employed by public agencies are salariedAdvantagesIt allows a dentist to be largely free of business concerns of running a practice thereby allowing the dentist to concentrate on clinical mattersFringe benefits are also often attractiveDisadvantagesThere could be a lack of financial incentive that some dentist needs to be highly productivePublic programsPrivate practice is usually not able to meet dental demands of all the publicTherefore a number of public program are aim to meet the need of specific groups in diverse societyPublic financing of dental care:MedicareMedicaidNational health insurance

Public programsMedicare:This program removed all financial barriers from hospital and physician service for all persons ages 65 and above regardless of financial meansBy the mid-1970s Medicare has two partsPart A:hospital insurancePart B:supplimental medical insurancePublic programsMedicaid:It is a joint federal state program covering at least these basic servicesInpatient hospital careOutpatient hospital careLaboratory and x-ray serviceSkilled nursing facility serviceshome health services for individual aged under 21&olderPhysician services

Public programsNational Health InsuranceIntroduced by Bismarck in GermanyPrimarily a financing mechanism by which health care service are paid from publicly organized fundHumanitarianism was a factor in their development

Payment for dental health service in India Fee-for service:Dental insuranceGovernment schemesEmployees state insurance scheme (ESI)Central government health scheme (CGHS)

ConclusionThe financing of dental care is well developed and well practiced in developed countries like U.S However in India fee for service is still most the prevalent form of availing dental servicesAlthough free dental services are provided by the government at some of the health centers, it is scarce and in-efficientDental insurance is in its infancy in which the very high premiums , dental service is still very far from the reaches of indigent.Thank you