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10 Questions to Avoid Fraudulent Dental Plans

When shopping for a dental plan, asking the following questions can help you avoid fraud.

1. Are you licensed to offer this plan in this state?

DHMO, DPPO and indemnity dental plans are required to be licensed with the Insurance or Health Department in the state where benefits are offered. Referral or discount plans are generally not required to be licensed as these plans are not providing “insurance” but rather discounts off of usual rates charged by dental providers. However, an increasing number of states are requiring specific registration of these companies.

Any company stating that they are offering “insurance” must be licensed to operate while a company stating they offer “discounts” or “access” to a dental provider network may not have to be licensed. However, corporations are required to be registered with the Secretary of State.  Either way, the company should clearly state their license or registration status when asked.

2. Are you registered with the Secretary of State?

All legitimate companies operating in a state should have at least filed documents with the Secretary of State in the state where they are operating. These are basic documents that show legitimacy and give you information about the operating address, officers and contact information for the company. You can usually check with the Secretary of State in your state to see if a company has filed.  Refer to the blue State Government pages in your phonebook to get a listing for your Secretary of State or Corporations Division.  Some states may have on-line look up services for these purposes.

3. Are you registered with the Better Business Bureau?

Your local and national Better Business Bureau is a valuable tool in assessing the validity of a company in your area. The BBB maintains a large database of companies, where they operate, contact information and complaint data. While not every legitimate company may be listed with the BBB, they are a great source of information on consumer protection and advice. The BBB can be found on the web at www.bbb.org and be sure to check with your local office for additional information.

4. Where are you located and what is your address of operations?

Legitimate dental plans will have an address of their local or national office and would be able to provide this information. Some bogus dental plans will be hesitant to provide this information or will give an address that is, in fact, nothing more than a local post office box office. You can check with the United States Postal Service (www.usps.com) to get the physical location of post office box facilities. You can also request address information of a post office box holder by going to the physical location of a post office box and paying a small fee (typically $3.00) to get the “last known” information for that box; i.e. the actual holder of the post office box.

5.  Can you mail me information on the plan, the providers and other details before I sign up with the plan?

Recently investigated scams surrounding dental plans have found that these bogus operations are more likely to collect your “membership fee” before they will send you any information. In one case, callers were told to mail their membership fee check (no credit cards were accepted) to an address, then fax a copy of the check to their operator so they could get you on the system as soon as possible. Callers were then told that they would get a packet of information within 12-14 days. All legitimate plans will have marketing materials that they will be glad to send you or direct you to their web site were you can read specifics of the plan offered.

6.  Do you have a web site with more information?

Many dental plan companies have extensive web sites that outline the plan operations, benefits, approximate costs and the providers accepting the plan in your area. While web sites are easily created by bogus operations, you will at least be able to have information before you purchase. A sure sign of a bogus plan is an unwillingness to send you any information before you purchase the plan.  In most cases, you will be told that information will be sent within 12-14 days after they receive your membership or sign-up fee.

7.  Can I get a list of the providers on the plan?

Many credible dental plans have their provider lists posted to their web sites.  If not, most will send you a list of the providers in your area.  A common phone fraud technique is to ask you your zip code and then read you a list of providers in that zip code from a mail list that they have. Giving verbal information is not enough, get it confirmed in writing.  Call the dentists on the list that you might choose and verify that they are affiliated with the plan and are open to new patients.

Even referral or discount dental plans have agreements with the providers on the plan so the dental office should be familiar with the dental plan company and be able to verify that the company is legitimate and operating in your area. Be sure to verify the exact name of the company with the provider office. Fraudulent plans often use deceptively similar names to licensed companies.

8.  Can I think about your plan and get back to you next week?

Most bogus dental plans will use very high pressure techniques to get you to join the day you call. Many will state that there are “only a few slots left in the group” or the offer is very limited and will only be open for a few days. Individual plans do not rely on your participation in a group plans.  Group plans are not limited by any number. In fact, group plans are able to spread the risk across larger groups and would not limit the members in a group to an arbitrary number. Further, group plans are only offered to bona fide groups, i.e. groups of people that have a business, social or association relationship that allows a dental plan to offer a group product

9. Is your plan endorsed by or affiliated with any national organization?

A recent bogus dental plan operation stated that the dental plan was endorsed by the “United Dental Association.” A little web research found no such organization. If you have internet access, Google any organization that a plan indicates has provided an endorsement. Professional organizations of dentists do not endorse insurance plans.  Trade organizations that a dental plan could be a member of include our organization, i.e. the National Association of Dental Plans, the Delta Dental Plans Association, America’s Health Insurance Plans, the Blue Cross Blue Shield Association of the California Association of Dental Plans. None of these trade organizations “endorses” one plan over another but they may state they are members. Ask any plan stating that they are endorsed or affiliated with a national organization for the name, address and phone numbers of the endorsing organization. Call the endorsing organization to verify that the plan is indeed endorsed or affiliated.

10. Are you a member of the National Association of Dental Plans?

While not all dental benefits companies are members of the National Association of Dental Plans (NADP), NADP is the only national dental benefits company organization that focuses solely on the issues of the dental benefits industry and represents approximately 65% of the entire dental benefits market, including dental health maintenance organizations, dental preferred provider organizations, dental indemnity insurers and dental discount (referral) plans. While NADP cannot recommend one plan over another, NADP can provide contact information and verify that a company is a legitimate plan offering benefits in the state where you reside.

 

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