The Importance of Staying In-Network

September 17, 2013

My husband Dave recently broke up with our family dentist, and it wasn’t his idea. He felt jilted when he got a letter in the mail a few months ago notifying him that Dr. Muller was no longer going to participate as an in-network provider through his employer’s group dental insurance. In the letter, Dr. Muller encouraged patients to continue to see him, just not with the advantage of the negotiated rates. Would it really make that much of a difference?

Most of us know by now to check to make sure a doctor or hospital is “in-network,” meaning they have signed up with your health insurance provider to accept pre-negotiated reduced fees for their services.  If you do venture outside of the network, you are typically still covered by your health insurance but at a substantially reduced rate.  For example, as long as I go to an in-network doctor, my coinsurance is 80/20 (so I’d pay only 20% of the cost after I reached my deducible) and my total out-of-pocket is capped at $5,000.  However, if I went out-of-network, my coinsurance drops to 50/50 and my total out-of-pocket doubles to $10,000.

That is certainly enough incentive for me to do my homework before scheduling an appointment for a medical issue. But would it be much of a cost difference for dentistry also? Dave’s dental plan through work is a PPO plan, where he is free to go to any dentist, but if he goes to a dentist who is not in the preferred provider network, he’d only be covered for the standard negotiated rate, and he’d be balance billed for the excess cost by Dr. Muller, who has opted to not accept the negotiated rate anymore, citing in his letter that he can’t make a living from the reduced prices of his services.

Shortly after Dave got the letter in the mail, I was due for my semi-annual cleaning, and luckily, Dr. Muller hadn’t broken up with me (oops, I mean my  dental insurance) yet. He is one of the best (and cutest) dentists I have ever been to, and I didn’t want to make the switch too. So off I went to my appointment, handed over my Delta Dental card, and a few weeks later, got my EOB in the mail. The EOB, or explanation of benefits, revealed that Dr. Muller initially charges $159 for a cleaning and exam, but Delta Dental’s negotiated price was only $79.  This means that the difference of $80, more than half of the “sticker price,” was dropped from my bill due to the negotiated rate.

I imagine that Dave’s insurance had an even lower negotiated rate if he was dropped and I wasn’t.  If Dave had decided to continue on as a patient, he probably would have ended up paying more from his own pocket than what the insurance company paid on a claim.  He probably would have done so since he likes Dr. Muller had it not been for the perfect timing of my own visit to provide such clarity on the pricing difference.

So whether you are off to see your dentist or doctor, always make sure to check if they are still in your network.  Fortunately, most insurance carriers provide an online directory to make it easy to verify participation of your provider. Otherwise, you could get stuck with a surprise out-of-network surcharge.