Any patient who seeks dental treatment needs dental insurance coverage. A patient might have a choice of dental practices to go to. On choosing a particular dental practice, a patient might realize that the practice is not in-network with the insurance company that offers them
coverage.
In such situations, a patient can still seek the services of a practice of their choice. While it is apparent that an in-network practice is a cost-effective alternative, a visit to an out-of-network practice can still be economically viable for a patient.
Here is where a MAC dental plan or a UCR dental plan comes into play. The final amount payable by a patient depends on the patient’s dental plan and whether they use UCR or MAC fees.
Let us take a closer look at what does UCR stand for or what is a MAC dental plan.
MAC or Maximum Allowable Charge is the upper limit or the maximum amount that any insurance firm will pay. This refers to the treatment or service that is covered by the plan and provided by any dental practice. The service rendered to the patient will always be covered
by the insurance firm. The patient can select a practice that is in-network or out-of-network. The deciding factor is the difference to be paid by patients. This difference will be paid by patients an out-of-pocket expense.
As an example, practices that are in-network could charge more for a treatment than determined by the MAC fee. But due to being in-network, the practices must agree with the insurance firm and accept the MAC rate. For a patient, such a difference between the
practice’s fee and the MAC fee will be written off, and the patient would not have to bear it. Based on the patient’s policy, an insurance company will cover a percentage of the MAC fee. The balance would have to be borne by the patient as coinsurance or a deductible
based on the policy and payments made.
For an out-of-network practice, there is no contractual obligation to acknowledge the MAC fee. This means that a patient is liable to pay the coinsurance or deductible as per the plan, as well as the difference between the MAC fee and the fee charged by the practice.
The example can be illustrated using figures. A patient needs to visit a practice for a procedure, and the insurance plan covers 85% of the fee charged by the practice. Based on the area of operation, the MAC fee for the same procedure is fixed at USD 140.
Now, let’s consider an in-network dental practice that a patient visits, which charges an amount of USD 180. As per the plan, the insurance company covers 85% of the MAC fee. The amount covered works out to USD 119. The balance amount of USD 21 would have to
be borne by the patient. The insurance company will not consider the balance of USD 40 as it has agreed to abide by the MAC fee as part of the dental network.
One also needs to consider the case of a practice that is out-of-network. In such a case, the practice will charge a fee of USD 180 for the above procedure. The insurance company will, however, pay 85% of the MAC fee of USD 140. As the practice is out-of-network, the MAC
fee is not applicable, and hence an amount of USD 180 needs to be paid. The patient would then have to pay the difference of USD 21 as well as USD 40.
The primary advantage of a MAC dental plan is the economic benefit to the patient by way of a lower premium. The MAC plan provides patients with access to lower or reduced fees and a vast range of dental practices across a majority of states.
There are times when a patient might select an out-of-network dental practice. A MAC plan can still enable comprehensive access to dental practitioners of their choice. This proves to be helpful for any patient who has comfort levels with a particular dental practitioner, their
existing dental practice, or has limited access to practices of their choice in their place of work or stay.
The main disadvantage of selecting a MAC dental plan, especially for businesses, can be the population in the area and the states where the business operates. Out-of-network dental practices translate into higher treatment costs. Staff who face chronic dental issues
have higher out-of-pocket expenses. Waiting periods for plans to get active can also be a Deterrent.
UCR (Usual, Customary and Reasonable) can be described as a fee that is charged for any defined procedure and is usually calculated as an average of what most dental practices in a particular geographical region would charge. This UCR amount is denoted as a percentile.
The calculations are made by a third party based on claims for the same procedure in the region. A region is usually defined by the initial three digits of the practice’s zip code.
To elaborate, one can consider a typical 90th UCR plan. This indicates that the UCR value for a defined procedure will be fixed for an amount that 90% of dental practices in the area would charge patients, or even lower. less. An insurance company will reimburse this amount for a covered service under the patient’s plan if the practice is out-of-network.
Since UCR can get complex, let’s consider an example. With reference to the illustration in the MAC example, the insurance firm will cover 85% of the same procedure that is rendered to the patient. However, instead of MAC, the patient’s plan is now based on the 90th UCR
or what 90% of dental practices in the defined zip code would charge for the procedure on Average.
If the average figure is USD 100, then an insurance firm will 85% of USD 100, which is USD 85. If the practice charges an amount of USD 120, the patient will have to pay an additional amount of USD 35, assuming that all other conditions, such as the deductible, have already been met.
However, if the dental practice charges a fee of USD 80. This amount is less than the UCR amount. The insurance firm will then pay 85% of the fee charged by the practice and not the UCR amount. This works out to USD 68, and hence the patient will then have to pay the difference of USD 12.
There are multiple UCR fee schedules, such as 90th , 80th, and 70th percentile plans. Hence, the reimbursement fee will usually go above the rates that dental practices normally charge. This means that patients will have to pay lower out-of-pocket costs. Hence, a UCR plan can
work well for patients living in remote areas that don’t have many practices that are in- network.
The major disadvantage of a UCR plan is the variations in coverage depending on the state where the practice has its operations. A patient may have different amounts to pay for the same procedure across states. One needs to comprehend the differences in UCR fees based on geographical regions and identify applicable fees.
There is also a possibility of a lack of transparency in the calculation of fees for a UCR plan, and hence, some fees can be higher than what one might find in a MAC plan.
One needs to understand the differences before selecting a MAC or UCR plan since they are applicable to out-of-network providers. A MAC plan controls the fee that a patient must pay a dental practice, especially when in-network. A UCR plan is based on an average of what most practices in the geographical area will charge for a specific service.
