-Similar to the fully-indemnified plan with the exception that the
employer bears the sole financial responsibility for the benefits.
-Premiums are paid directly into a trust fund
-A third party administrator ( TPA), often insurance company, uses trust
funds to pay claims and operational costs
Advantages
-Employees are free to choose their own dentist or dental specialist and
are free to change at any time
- 10-20% less expensive than a fully insured plan.
-Dental offices file claims, and benefits are paid directly to the dentist
out of the trust fund
-The employer receives regular reports regarding utilization and
administrative costs. This gives the employer greater accountability.
Disadvantages
-Employer costs are not fixed and expense varies depending on employee
utilization.
-Like the fully insured plan, fees work from a UCR schedule with
limitations and restrictions.
Purchase Considerations
-Choose a reliable third party administrator (TPA). Check references
-Compare plans
-Ask to see the UCR schedule. Ask how often it is updated.
-Check the UCR Percentile
-Check the fees charged by the TPA. Make sure the rate is competitive.
-Exercise cautions if TPA’s rates are inordinately low.
