Take the bite out of dental costs
You think a root canal is painful? Just wait until it's time to pay the bill.
NEW YORK (MONEY Magazine) - Taking care of your mouth can cost an arm and a leg these days.
Only 55 percent of Americans have dental insurance, which leaves nearly half of us paying the entire way for care that can easily run $300 per person a year for basic preventive checkups and cleanings. Experience a bout of expensive gum or tooth problems and you'll need a shot of Novocain to deal with the financial pain.
Even if you are lucky enough to have insurance through your employer, you typically end up paying for about half of your dental costs once you factor in the deductible, your share of the annual premium, and required co-pays of 20 to 50 percent for many procedures. And you could easily have to pay 100 percent of your bills if you manage to blow past the typical $1,200 maximum annual benefit.
Granted, your mouth isn't likely to need a major overhaul each year. And compared with medical expenses, taking care of your teeth is almost cheap. But that doesn't mean you have to grin and bear the full cost. Here are six money-saving strategies to chew on.
1. Get a dentist with a plan
Just as with medical insurance, if you opt for a dentist who is enrolled in your insurer's preferred-provider organization, or PPO for short, you will receive a price break.
Cathye Smithwick, who runs the dental arm of Mercer Health & Benefits, says a switch from your old family dentist who isn't in the plan to one who is enrolled can cut your costs 15 to 35 percent.
"It's the best of both worlds," she says. "You still have plenty of choice in the dentist you see, yet there is a significant cost savings."
If you don't have dental insurance coverage at work, you may have already figured out it isn't terribly cost-effective to buy a PPO policy on your own. An annual premium of $400 or so for an individual plan ($1,200 or more for a family) is a lot to pay for 100 percent coverage of checkups and cleanings.
And for restorative care, like fillings or root canals, you typically need to sit out a three- to 18-month waiting period before you get any coverage. Even then you'll be responsible for 20 to 50 percent of the work, and 100 percent if you go over the annual per-person benefit limit of $750 to $1,200. (A dental HMO is cheaper -- less than $200 on average -- but you face a far more limited choice of dentists.)
So what do you do? Try lobbying your employer to offer a policy where employees bear 100 percent of the expense. There's no cost to the employer, and you and your colleagues will likely qualify for a group rate that's 5 to 40 percent less than an individual policy, says Evelyn Ireland, executive director of the National Association of Dental Plans. Group plans often have more extensive coverage, such as an orthodontics benefit. And companies with as few as two employees can qualify.
2. Join a discount club
If an individual policy isn't offered through work, your next best move could be a discount plan. You pay an annual membership fee -- around $100 for an individual and $150 for family coverage -- that entitles you to discounted prices from participating dentists.
It is crucial to understand that this is not insurance; it's simply a way to snag lower fees. Participating dentists cut their rates because they don't have to go through the time and expense of filing an insurance claim and waiting for payment, since you pay the bill before leaving the office. Typical savings: between 20 and 30 percent, though it can be higher depending on the procedure.
If you currently play dental roulette by paying for all your dental work out of pocket, forking over $100 or so a year to enroll in a dental plan provides a bit of a cushion if you run into major costs. And even if you have other dental coverage, discount dental may be a smart way to pay for cosmetic procedures, which generally are not covered by insurance, and orthodontics, which is usually only partially covered.
Beware, however: There is a history of fraudulent discount dental firms collecting membership fees without providing any service. So make sure you are working with a legitimate firm by sticking with major players like Careington, Aetna, Cigna and WellPoint's Uni-Care affiliate, and by checking with your state insurance commissioner to make sure the firm is registered. (You can reach your state insurance office by starting at www.naic.org.)
Don't send in money before you receive plan documents, which should include a fee schedule for participating dentists in your area. And check that there are indeed in-plan dentists and dental specialists near you and that they're providers you'd actually like to go to. For shopping resources, see the box above.
3. Choose your treatment
There is no one right way to treat a dental problem. Ideally, your dentist should understand your insurance status and give you a variety of treatment choices.
But if your dentist isn't quick to offer less expensive alternatives, don't be shy about asking, Mercer's Smithwick says. For example, a $900 porcelain crown might offer the best long-term solution for a serious cavity, but a simple metal filling at $200 or less may also be a viable option that fits your current budget.
And given that it is rare to need emergency dental care, you and your dentist can work the calendar to reduce out-of-pocket expenses. If, say, you're facing $3,000 of major gum and tooth care and your plan has a $1,200 annual max, you could spread the work over two calendar years and get $2,400 in coverage.
4. Be flexible
Using your bills from the previous year, it's easy to anticipate how much you're likely to spend on preventive dental care like basic checkups and cleanings. Then have at least that amount diverted into a flexible spending account if your employer offers one.
FSA contributions reduce your taxable income dollar for dollar. That means, for example, if you are in the 25 percent tax bracket, setting aside $2,000 for dental costs can reduce your tax bill by about $650.
The old rap against FSAs is the "use it or lose it" clause: Any money left in your account is surrendered at year-end. But thanks to a recent IRS ruling, the year just got longer for FSAs; you now have until March 15 of the following year to tap your FSA.
You may have to wait until next fall to sign up for your FSA -- that's when employers typically allow enrollment in benefit plans -- and you will get the March 15 extension only if your employer has amended its plan. One important hitch: Your FSA money can be used only for necessary dental coverage; cosmetic work and teeth whitening aren't eligible.
5. Negotiate (politely)
A national survey recently found that 10 percent of respondents had haggled with their dentists over fees, and 64 percent had been successful in getting a price break.
Steven P. Cohen, president of the Negotiation Skills Company, says it's perfectly appropriate to talk to your dentist about payment options. "Tell the dentist, 'Look, I know I need the work, but is there any way you can make it less painful for me?'" That can lead to a reduced rate or partial payments over a few months or quarters.
Paying up front increases your negotiating power; if your dentist doesn't have the cost and hassle of filing an insurance claim, it's reasonable to ask to share in the cost savings -- say, 10 percent or more.
6. Brush up
According to a dental industry report, every dollar you spend on preventive care can save you anywhere from $4 to $50 in restorative care.
Translation: Checkups keep your dental bills down in the long run. That's something to smile about.
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