MECHANISMS OF PAYMENT 1. Private fee - for services 2. Post payment plans 3. Private third party prepayment plans -Commercial insurance companies -Non-profit health service corporations -Prepaid group practice -Capitation plans 4. Salary 5. Public programs 1. Private fee - for service • The two party arrangement, traditional form of reimbursement for dental services. • Integral part of private practice as a delivery method. Advantages: 1) Culturally acceptable 2) Flexibility 3) Administratively simple 4) Can be used in expensive situations Disadvantages: 1. Major percent of the population cannot afford dental care. Post Payment Plans or Budget Plans • First started in Late 1930's - local dental societies in Pennsylvania & Michigan • Mechanisms for the individual purchase of service Advantages: 1. Helpful for middle income people 2. Primarily used to finance prosthetic and other costly treatment Disadvantages: 1. Lower income people cannot use to the full 2. Problem of defaulted loans Private Third Party Prepayment Plans Defined as payment for service by some agency rather than directly by the beneficiary of those services. 1st Party-Dentist; 2nd Party-Patient; 3rd Party-Administrator of Finances Third Party/ Carrier/ Insurer/ Underwriter/ Administrative Agent. • Defined as The party to a dental prepayment contract that may collect premiums, assume financial risk, pay claims and provide administrative services Reimbursement of Dentist in Third Party Plans The major forms of third-party reimbursement currently in use are: Usual fee: The fee that an individual dentist most frequently charges for a given dental service. Customary Fee: The fee level determined by the administrator of a dental benefit plan from actual submitted fees for a specific dental procedure to establish the maximum benefit payable under a given plan for that specific procedure. Reasonable Fee: the fee charged by the dentist for a specific dental procedure that has been modified by the nature and severity of the condition being treated and by any medical or dental complications may differ from the dentists usual fee or the benefit administrators customary fee. A table of allowances: A list of covered services with an assigned amount that represents the total obligation of the plan with respect to payment for such service but that does not necessarily represent the dentists full fee for that service”. Fee schedule: A list of charges established or agreed to by a dentist for specific dental services. A fee schedule is usually taken to represent payment in full, whereas a table of allowances may not. Capitation: A capitation fee is usually a fixed monthly payment paid by a carrier to a dentist based on the number of patients assigned to the dentist for treatment. SALARY Dentists in some group practices, those in the armed forces and those employed by public agencies are salaried. PUBLIC PROGRAMS Medicare Medicaid NHI

1. By
Dr. Lasya
1

2. CONTENTS
• Introduction
• History
• Mechanisms of Payment
• Recommendations
• Strategies for health financing
• Conclusion
• References
2

3. INTRODUCTION
• Health care historically has been provided on a fee-for-service basis, in which the
patient pays the provider directly for services.
• As the cost of health care continue to rise, the majority of the people cannot afford
dental treatment.
• Methods have to be sought to ease costs either by legislation or by the development
of a variety of funding approaches.
3

4. HISTORY
• 6000B.C – Barter system – old method of exchange. Alternative method of trading
where goods and services are exchanged directly for one another without
using money as an intermediary.
• 1945 - the start of voluntary prepaid comprehensive dental care in St. Louis, U.S.A.
• 1948 - Establishment in England of a National Insurance Scheme including
Comprehensive Dental Service.
• 1948 - Bisell. B. Palmer of New York City founded Group dental health insurance as
open panel pre-payment system.
4

5. • 1949 - Group Health Association, consumers co-operative in Washington, established
a dental clinic service, which soon changed from fee for service
basis to prepayment.
• 1954 - Washington State Dental Council organized Washington State Dental Services
Corporation for helping administer prepayment dental care plan for children
of International Longshoreman’s Union Pacific Maritime Association.
• 1965 - Medicare brought medical care to the aged of the U.S without regard to the
income. This did not include dentistry, but Medicaid did.
5

6. • 1973 - Health Maintenance Organization Act was passed which provided
government support for organizations providing standardized comprehensive
care to the individuals in enrolled groups.
• 1989 - Delta Dental Plan and other agencies were covering about 107 million
beneficiaries.
6

7. MECHANISMS OF PAYMENT
1. Private fee - for services
2. Post payment plans
3. Private third party prepayment plans
3a. Commercial insurance companies
3b. Non profit health service corporations
3c. Prepaid group practice
3d. Capitation plans
4. Salary
5. Public programs
7

8. Private Fee for Service
• The two party arrangement, traditional form of reimbursement for dental
services.
• Integral part of private practice as a delivery method.
Advantages:
1) Culturally acceptable
2) Flexibility
3) Administratively simple
4) Can be used in expensive situations
Disadvantages:
1) Major percent of the population cannot
afford dental care
8

9. Indian scenario
• This is the payment method most commonly employed in India.
• India, though committed to provide health care for its citizens, has one of the
lowest per capita public expenditures on health.
• The government spends just 1.26% of the GDP on health care. As 80% of this is on
salaries, there is little for other medical conditions.
• This results in poor quality of care in most of these government institutions. This
pushes the patients to use the private sector to meet their health needs.
• Estimates show that about 80% of all outpatients and about 40-60% of all
inpatients use the private health care facilities.
9

10. • At these facilities, the patients pay user fees for each service received and this is met
from out of pocket.
• As the cost of dental care continues to rise, the majority of the people are not able to
afford dental treatment, especially when it is being provided on a fee for service
basis. Very few people can afford to utilize this service regularly.
• This places a large burden on the households, especially the poor and indigent. They
are forced to borrow or sell their assets to meet the expenses.
• Most of the people will visit dentist only for curative services. Preventive measures
are not given importance due to high cost.
10

11. Post Payment Plans or Budget Plans
• First started in Late 1930's - local dental societies in Pennsylvania & Michigan
• Mechanisms for the individual purchase of service
• Payments made at intervals over a period of time
Advantages:
1. Helpful for middle income people
2. Primarily used to finance prosthetic and
other costly treatment
Disadvantages:
1. Lower income people cannot use to the
full
2. Problem of defaulted loans
11

12. Private Third Party Prepayment Plans
• Defined “as payment for service by some agency rather than directly by the
beneficiary of those services”.
1st Party - Dentist
2nd Party - Patient
3rd Party - Administrator of Finances
Third Party/ Carrier/ Insurer/ Underwriter/ Administrative Agent.
Defined as “The party to a dental prepayment contract that may collect premiums,
assume financial risk, pay claims and provide administrative services”
12

13. Insurance Principles
• To be Insurable, a risk must:
1. Be Precisely definable
2. Be of sufficient magnitude, if occurs, should cause a major loss
3. Be infrequent
4. Be of unwanted nature
5. Beyond the control of individual
6. Not constitute a moral hazard
13

14. Dental insurance made more feasible:
1. Have patient share the cost
2. Limit the range of services available
3. Offering services only to group
4. Include waiting period before benefits become payable
5. Use pre-authorisation and annual expenditure limits
14

15. Different types of payments offered by an insurer
Payments either by
a) Deductible (Front-end-payments) – Flat sum paid
b) Co-insurance (Paid in percentages)
c) Group Insurance
1. Deductible: - It is a stipulated flat sum that the patient must pay toward the cost of
treatment before benefits of the program go into effect.
• It is sometimes called a “front end payment’’.
15

16. 2. Co-Insurance/ Co-Payment
• Means that the patient pays a percentage of the total cost of treatment.
• Dunning defined Co-Insurance as an arrangement under which a carrier and the
beneficiary are each liable for a share of the cost of the dental services provided.
• Insurance carriers limit the range of health care services covered.
• This is termed, ‘limitation of benefits’’.
• Helps to keep premiums down.
16

17. 17
THIRD PARTY FEES Rs 80/-
DENTIST’S FEES Rs 100/-
FROM PATIENT COLLECT Rs 20/-

18. 3. Group insurance
• Offered only to groups.
• This is because illness experience is reasonably predictable in a group.
• The probability of adverse selection was also reduced by the use of waiting periods
after enrolment before any benefits become available.
• The waiting period ensured that persons with existing disease were not simply going
to use the plan to have that disease treated and then drop out.
18

19. Reimbursement of Dentist in Third Party Plans
The major forms of third-party reimbursement currently in use are:
 Usual, customary and reasonable fee
 Table of allowances
 Fee schedules
 Capitation
19

20. Usual fee: The fee that an individual dentist most frequently charges for a given dental
service.
Customary Fee: The fee level determined by the administrator of a dental benefit plan
from actual submitted fees for a specific dental procedure to establish the maximum
benefit payable under a given plan for that specific procedure.
Reasonable Fee: the fee charged by the dentist for a specific dental procedure that has
been modified by the nature and severity of the condition being treated and by any
medical or dental complications may differ from the dentists usual fee or the benefit
administrators customary fee.
20

21. A table of allowances: “A list of covered services with an assigned amount that
represents the total obligation of the plan with respect to payment for such service but
that does not necessarily represent the dentists full fee for that service”.
Fee schedule: “A list of charges established or agreed to by a dentist for specific dental
services. A fee schedule is usually taken to represent payment in full, whereas a table
of allowances may not”.
21

22. Capitation
“A capitation fee is usually a fixed monthly payment paid by a carrier to a
dentist based on the number of patients assigned to the dentist for treatment.
• Capitation requires that patients be assigned to specific dentists or dental practices
for care, so that the capitation payment can be paid to the appropriate dentist or
practice.”
22

23. Two Types
1. Stand alone dental insurance plan: covers the expenses related to general dental
problems, such as periodontitis and extraction of permanent teeth due to ailments
such as caries.
• This type of plan is generally provided by the popular dental care product
companies in association with one of the insurance companies.
2. Dental insurance cover as part of general health insurance plan: This type of
dental insurance is provided by the general insurance companies as part of their own
general health insurance schemes, such as health advantage policy or student
medical policy.
• Through this scheme, one can claim dental expenses along with the other kinds of
reimbursements, such as the cost of medicines or hospitalization. 23
COMMERCIAL INSURANCE COMPANIES

24. Employees State Insurance Scheme (ESIS)
• Established in 1948
• ESIS is an insurance system which provides both the cash and medical benefits
• Managed by Employees State Insurance Corporation (ESIC)
The scheme cover
– Non-power using factories employing 20 or more members
– Power using factories employing 10 or more persons
– Road transport establishments
– News paper establishments
– Cinema theatre, hotels and shops
24

25. • For all employees earning 15,000 (US$220) or less per month as wages, the
employer contributes 4.75 percent and employee contributes 1.75 percent, total
share 6.5 percent.
• State government's share is 1/8th and that by central government is 7/8th.
• ESIC raised the monthly wage limit to Rs 21,000, from the existing Rs 15,000, for
coverage with effect from 6th September, 2016.
25

26. BENEFITS
(1) Medical benefit
(2) Sickness benefit – 50% of average daily wages. For a maximum period of 91 days in
a year
(3) Maternity benefit
(4) Disablement benefit - temporary disablement – 72% of the wages for the duration
disablement; permanent disablement – in the form of pension
(5) Dependant's benefit
(6) Funeral expenses
(7) Rehabilitation allowance
26

27. • Recent years have seen an increasing role of information technology in ESI, with
the introduction of Pehchan smart cards as a part of Project Panchdeep. In addition
to insured workers, poor families eligible under the Rashtriya Swasthya Bima
Yojana can also avail facilities in ESI hospitals and dispensaries. There are plans to
open medical, nursing and paramedical schools in ESI hospitals
27

28. Defense Medical Services
• Medical and dental care is provided through their own organization under the banner
“Armed Medical and Dental Services”.
Health Care of Railway Employees
• Comprehensive health services including dental treatment through the agency of
railway hospitals, health units and clinics
28

29. Central Government Health Scheme (CGHS)
• Previously known as – “Contributory Health Service Scheme”
• Introduced in 1954 in New Delhi to provide comprehensive medical care to central
government employees and their families
• 320 Separate dispensaries for the employees covered by the scheme
Covers
 Central Govt employees
 Retired central Govt employees
 Widows receiving pension
 Members of parliament
 Ex-governors
 Retired judges 29

30. Facilities under the scheme
– Out patient care through network of dispensaries
– Supply of necessary drugs
– Laboratory and X-ray investigations
– Domiciliary visits
– Hospitalization facilities at Govt and private hospitals
– Specialist consultation
– Pediatric consultation including immunization
– Emergency treatment
– Supply of optical and dental aids at reasonable rates
– Family welfare service 30

31. Voluntary Health Insurance Schemes or Private for Profit Schemes
• In private insurance, buyers are willing to pay premium to an insurance company that
pools people with similar risks and insures them for health expenses. The key
distinction is that the premiums are set at a level, which provides or profit to third
party and provider institutions.
• In public sector, the General Insurance Corporation (GIC) and its subsidiary
companies (National Insurance Corporation, New India Assurance Company,
Oriental Insurance Company and United Insurance Company) and Life Insurance
Corporation (LIC) of India provide voluntary schemes.
• Of the various schemes offered, Mediclaim is the main product of General Insurance
Company.
31

32. Mediclaim Policy of the General Insurance
Corporation (GIC)
• GIC was set by Govt in 1973 as a public sector organization to market a range of
insurance services
• Its four subsidiaries;
1. National Insurance Company
2. Oriental Insurance Company
3. New India Assurance Company and
4. United India Insurance Company
• It introduced Mediclaim insurance scheme in 1986, and became active in 1987
32

33. • Policy was modified in 1996 to allow for differentials in premium
• Policy was framed for both groups and individuals.
• Mediclaim provides only reimbursement insurance
Salient Features
1. Provides cover, which takes care of medical expenses following hospitalization
from sudden illness or accident.
2. Cover extends to pre-hospitalization and post-hospitalization for periods of 30 days
and 60 days respectively.
3. Domiciliary hospitalization is also covered
4. Dental treatment except arising out of accident.
33

34. Cost:
• Sum insured can be anywhere between Rs. 15,000 to Rs. 5,00,000.
• Rate of premium ranges between Rs. 175 to Rs. 2,500 per year depending on age
and capital sum insured.
Major weaknesses of Mediclaim
1. It covers only hospitalization, leaving out, out-patient care
2. Subjected to various exclusions, limits and restrictions on eligibility
3. Premiums are high in relation to claim payments which are only 58% of the
premiums
34

35. Apollo Munich Health Insurance
Maxima Plan
• Upto 65 years
• Dental treatment is covered for Rs. 1,000/- in a year, subject to treatment taken
in a network hospital.
• OPD is covered for Rs.10,000/- to Rs.15,000/- approx. including consultation
fees & Annual health check-up
• Out-patient Dental Treatment within specified Network - Any necessary dental
treatment taken by an insured person from a Network Dentist provided that
company will not pay for any dental treatment that comprises cosmetic
treatment.
35

36. Munich Health Insurance ICICI Lombard
• Available to those aged 5 - 70 years
• Children being covered with their parents
• Is given to corporate bodies, institutions and association.
• Sum insured is minimum Rs. 15,000 and a maximum of Rs. 500,000.
• Premium chargeable depends on age of person and sum insured selected.
• The policy covers reimbursement of hospitalization expenses incurred for diseases
contracted or injuries sustained.
36

37. • On payment of additional premium, the policy can become extended to cover
maternity benefits, pre-existing diseases and reimbursement of cost of health check-
up after four consecutive claim-free years.
• Under this scheme, along with reimbursements of costs of medicines,
hospitalization, and other charges, dental expenses are also reimbursed.
• For students, medical insurance gold plan includes expenses of dental treatment.
37

38. Star Health Insurance
• Star Health and Allied Insurance Co Ltd commenced its operations in 2006 with the
business interests in health insurance, overseas mediclaim policy and personal
accident and it is number one stand alone Health Insurance Company in India.
• Head quarters: Chennai, Tamil Nadu- India
Health Star Gain
• 5 months to 60 Years.
• Treatment costs covered even for pre-existing conditions/diseases, dental expenses,
prenatal and post-natal care
38

39. Max Bupa Health Insurance
Heartbeat Platinum Policy
• At any age
• This policy covers cost of treatment incurred as an outpatient in any hospital or
nursing home.
• Put a natural tooth back into a jaw bone after it is knocked out or dislodged in an
accident
39

40. • Treat irreversible bone disease involving the jaw which cannot be treated in any
other way.
• Surgically remove a complicated, buried or impacted tooth root, for example in the
case of an impacted wisdom tooth.
• Exception: Oral condition, which includes Surgical operations for the treatment of
bone disease when related to gum disease or damage, treatment arising from,
disorders of the temporo-mandibular joint.
40

41. Bajaj Allianz General Insurance
• Private general insurance company in India.
• The company is owned by the Bajaj Group of India and Allianz SE, a European
financial services company.
Tax Gain Plan
• 56 - 75 yrs for Senior Citizen Plan
• Insured can claim for dental procedures & treatment under OPD section, Cost of
dentures, can also be claimed under OPD Section
41

42. HLL launches Pepsodent Dental Insurance
• Hindustan Lever announced the launch of Pepsodent Dental Insurance, in
partnership with New India Assurance, wherein every purchase of a Pepsodent
toothpaste will enable the customer to get Rs 1,000 worth of free dental insurance.
• Under this initiative, Pepsodent offered consumers insurance cover against expenses
for the extraction of a permanent tooth due to severe caries and periodontitis,
including cost of medication.
• The insurance cover would be valid for one year and would take effect six months
after the purchase of the toothpaste.
42

43. Metlife Dental Insurance Plans
• Is currently offering its members a preferred dentist programe. This is considered as
a preferred provider organization with a nation wide network of 90,000 dentists
locations.
• Fee of this particular plan is 10.35%.
43

44. Working:
• Find a dentist registered under MetLife insurance company.
• Fix an appointment.
• Get required treatment.
• The plan covers essential care arrangements, malpractice coverage, endodontic
treatment, implants and dentures and other procedures
44

45. 45

46. Aarogyasri
• YSR Aarogyasri is a program of the Government of Andhra
Pradesh. It covers those below the poverty line. The government
issues an Aarogyasri card and the beneficiary can use it at
government and private hospitals to obtain services free of cost.
• The aim of the Government is to achieve "Health for All". In
order to facilitate the effective implementation of the scheme, the
State Government set up the Aarogyasri Health Care Trust under
the chairmanship of the Chief Minister.
46

47. • The scheme provides financial protection to families living below the poverty
line up to Rs. 2 lakhs in a year for the treatment of serious ailments requiring
hospitalization and surgery.
• 938 treatments are covered under the scheme in order to improve access of
BPL families to quality medical care for treatment of identified diseases
involving hospitalization, surgeries and therapies through an identified network
of health care providers.
47

48. Employee Health Scheme
• EHS is like governmental commercial insurance scheme in India.
• In this government deduct particular amount of money from the employee per every
month and the government pays back money to the doctor.
• The Govt. of the State of Andhra Pradesh with its vide G.O. No.134 dated 29-10-
2014 has issued this Scheme with few modifications.
48

49. • The Trust is set up for providing health care services to the families living BPL and
the families covered under the Journalist scheme, CMCO, destitute living in old age
homes under YSR Aarogyasri scheme, and the families of Government employees,
pensioners and their dependent family members in surgeries/ therapeutic procedures
for which purpose Trust has created a network of Service Providers.
• The Trust is a non-profitable institution which is providing the health care services
under the scheme to the respective States of Telangana and Andhra Pradesh.
• All the network hospitals including the corporate and government hospitals located
in the states of A.P under the respective EHS shall empanel itself and implement the
total of 1885 procedures, without fail.
49
1. Oral prophylaxis
2. Root canal treatment per tooth
3. Tooth coloured restoration
4. Simple extraction per tooth
5. Surgical Extraction per tooth
6. Third molar extraction per tooth
7. Alveoplasty per quadrant
8. Metal ceramic crown per tooth
9. Acrylic crown per tooth
10. All ceramic crown per tooth
11. Fiber post with All-Ceramic crown per tooth
12. Metal post with All-Ceramic crown per tooth
13. RPD per tooth
14. CD per arch
15. Flap surgery per Quadrant
16. Ortho metal braces
17. Ortho removable appliances
560/-
2000/-
450/-
300/-
1000/-
2000/-
690/-
1350/-
210/-
3050/-
3550/-
2000/-
550/-
3180/-
1720/-
10680/-
1570/-

50. Arogya bhadratha
• For state police officers
• Launched by DGP HJ Dora in 1999
• Treatment in super specialty hospitals
• Pay money directly to the hospitals
50
1. Oral prophylaxis
2. Anterior RCT
3. Posterior RCT
4. GIC restoration
5. Composite restoration
6. Extraction
7. Impaction
8. Ceramic Crown
9. CD
10. Ortho treatment
500/-
500/-
700/-
150/-
600/-
100/-
150/-
2000/-
7000/-
15,000/-

51. NON PROFITABLE ORGANIZATIONS
• Delta Dental Plan is synonymous with Dental Service Corporation
• Legally constituted Non – Profitable organization incorporated on a state by state
basis.
• They are subject to the insurance laws thereby negotiates, allowing to grow.
• Started as National association of dental service plans (NADSP) June 1966.
• Name changed to Delta Dental Plans Association, April 1969.
51

52. • The purpose of delta dental plan was to provide comprehensive dental care
programme for children up to 14 years age.
Characteristics of Dental Service Corporation:
• Professional sponsorship
• Non profit operation
• Participation permitted by all licensed dentists
• Benefit provided on a service basis
• Freedom of choice allowed for both patient and dentist
52

53. Members:
• Board of directors (dentists) representatives of world of finance, insurance, labour and
consumer groups.
Functions
1) Ensures quality and care provided
2) Keeps the cost within limits
53

54. Reimbursement of Dentist
Participating Dentist Non-Participating Dentist
Participant Dentist
• Is any duly licensed dentist with whom delta dental plan has a contractual agreement to
render care to covered subscribers
Condition
• Pre-filing of their usual and customary fee
• Payments at 90th percentile
• Conducts audits
54

55. • Post treatment inspection of randomly chosen patients to monitor the quality of
care.
• Delta capital reserve fund
Non – Participating Dentist
• Also treat patients covered under Delta dental plan.
• They are paid at a lower percentile than the 90th, often at the median or 50th
percentile.
55

56. 90th Percentile
56
Fees
Percentiles

57. 57
Advantages of delta plans
o Control of cost
o Quality assurance procedure
o No need to pay extra
• There by encourages regular attendance and maintains good dental health of
the society by various services

58. 58
Commercial v/s delta dental plans:
Commercial companies are better because
• Expertise in Promotion and Marketing
• Presents attractive total health packages
• Take the risk to offer reduced dental premiums

59. Blue Cross Blue Shield Association (BCBSA)
• Offers limited dental coverage as a part of medical/ surgical/ and hospital polices
• Has similar cost control features pioneered by delta plans
• Dental coverage are limited to services provided in a hospital.
• It does not put its hand into dental prepayments.
59

60. Non Profit Health Service Corporation in India
Karuna Trust
• It was initiated in September 2002 by a partnership between Karuna Trust, the Govt.
of Karnataka, the Govt. of India, the United Nations Development Programme
(UNDP), the National Insurance Corporation (NIC) and the Centre for Population
Dynamics (CFPD). Initially operational in T. Narsipur Taluk, it has been
subsequently expanded to Yelandur Taluk also.
• Karuna Trust organises the collection of premium and reinsures with the National
Insurance Company (NIC). The NIC (a para-statal insurance company) reimburses
the claims submitted by Karuna Trust.
60

61. Premium
• The premium varies according to the socio-economic status. The premium for the
households below the poverty line is Rs 30 per individual per year.
• UNDP fully subsidises the premium for the households that are below the poverty
line (BPL) and belong to the SC/ ST category. So in reality, for these families, it is
free.
61

62. Naandi foundation
• Naandi Foundation is an autonomous, not-for-profit trust dedicated to changing
lives of the underserved populations in India through public-private partnerships.
• Since 2002 and under the banner of Child Rights, Naandi, in partnership with the
state government of Andhra Pradesh.
• Young children in the age group of 6 to 14 years enlisted in public schools.
• The insurance plan provides “whole care” coverage without any limitation while
operating at all levels: primary, secondary and tertiary level.
• Surgical interventions extend to corrective, cosmetic and dental surgery.
62

63. Trinity Care Foundation
• Non-Profit Organization based in Bangalore dedicated to School Health Programs,
Facial Deformity Programs and Oral Cancer Programs, working with community
organizations, educational Institutions and involving Government, Industry and the
Medical Profession.
63

64. Prepaid Group Practice
Definition:
“A practice formally organized to provide dental care through the services of three or
more dentists using office space, equipment and/or personnel jointly”.
• Net income in a group is divided equally and paid according to
 Patient load,
 Years of service,
 Specialty status.
64

65. Types of Group practice:
o General practice groups composed entirely of general practitioners.
o Single specialty groups - all members of the group are of the same specialty.
o Multi-specialty groups where certain practitioners in two or more specialty fields of
practice
Advantages:
• Multispecialty
• Can enjoy vacation leaves
• Less disruption in practice caused by illness
• Quality of care will improve because of built-in peer review
• Financial benefits like sick leave and pension plans
65

66. In India
Smile Stone Dental Clinic
• Started in Delhi
• Team six consultants (specializing in each branch of Dentistry).
• Together they provide Comprehensive Dental Treatment for the entire family.
66

67. Vasan Dental Care Hospital
– With the beginning of Vasan Dental Care, the concept of Multi speciality Dental
hospitals began in India
– opened in the first phase in places like Kerala, Tamil Nadu, Andhra Pradesh.
– The first Vasan Dental Care hospital in India was started at Trichy
67

68. Health Maintenance Organizations (HMO)
Definition:
“A legal entity which provides a prescribed range of health services to each individual
who has enrolled in the organization in return for a prepaid, fixed and uniform
payments.
• Provides comprehensive health maintenance and treatment service
 Primary care
 Emergency care
 Hospital care
 Rehabilitation
68

69. • 4 principles that characterize an HMO are,
1. An organized system of health care that accepts the responsibility to provide or
assure the delivery
2. An agreed upon set of comprehensive health maintenance and treatment services
3. Voluntarily enrolled group of people in a geo-graphical area
4. Is reimbursed through a pre-negotiated and fixed periodic payment made by or
on behalf of each person or family enrolled in the plan.
69

70. An Enrolled Group:
• Members of the HMO are those people who voluntarily join the HMO through a
contract arrangement in which the enrolled agrees to pay the fixed monthly or other
periodic payment to the HMO.
• Enrollees agree to use the HMO as their principal source of health care if they
become ill or need care.
70

71. Different types of dental personal in HMO
• Staff model – in this dentist, dental assistants are salaried employees.
• Group models – HMO contracts directly with a group practice, partnership or
corporations for the provision of dental services.
• Independent Practice Association (IPA) – is an association of independent dentist
that develops its own management and fiscal structures for the treatment of patients
enrolled in an HMO.
• Primary Care Capitated Network or Direct Contract Model – network is similar to
IPA except HMO contracts individual provider for provision of services.
71

72. HMO in India
Hurdles In Implementing HMOs In India
• Experts fear that Indian HMOs would repeat the functioning of their counterparts in
the US, which in the pursuit of controlling costs and maximising profits, often
become very inflexible, thus defeating the purpose for which they were set up.
• "For both insurance and HMOs to function, the medical profession and practice has
to be regulated“
72

73. Suggestions for Developing HMOs
• Considering the government’s inability to increase the required financial inputs for
improving rural healthcare, both preventive and curative, Public Private Partnership
is the need of the hour. “Private partners may adopt primary health centres and
community health centres. By innovative approaches such as micro-financing and
micro-health insurance, we can provide them cost-effective healthcare,”
• Insurance companies can also adopt HMO models, which would in turn control the
way care is given or accessed.
73

74. • The other side of the coin is that most Third Party Administrators are focussed on
corporate clients. Therefore, if TPAs in India transform themselves into HMOs in
collaboration with a network of family physicians, specialists and hospitals, the
expertise of TPAs can be better utilised.
74

75. Preferred Provider Organizations
• Managed care arrangement system
• It involves contract between insurer and a number of practitioners who agree to
provide specific services for fees that are lower than average for that area.
• Competition for patients is the driving force behind the willingness to discount their
fee.
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76. Capitation Plans
• The dentist receives an established, negotiated sum on a monthly or yearly basis for
each liable patient.
• The money is paid regardless of whether the patients utilize care or not
• In return, patient is entitled to receive a prescribed set of services over a specified
period.
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77. Capitation fees
• Fixed monthly or yearly payments
• Paid by a carrier to the dentist for treatment
Disadvantages:
1) Fear of over utilization
2) Demand for expensive treatment
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78. Salary
Dentists in some group practices, those in the armed forces and those employed by
public agencies are salaried.
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Disadvantages:
1) There could be lack of financial incentive
2) Some dentists need to be highly
productive.
Advantages:
• It allows a dentist to be largely free of the
business concerns of running a practice,
thereby allowing the dentist to concentrate
on clinical matters.
• Fringe benefits are also often attractive.

79. Public programs
• Public financing of dental care
1. Medicare
2. Medicaid
3. National health insurance
1. MEDICARE (Title XVIII of social security amendments of 1965)
• It removed financial barriers for hospital and physician services for persons aged 65
and over, regardless of their financial means.
• Also covers disabled as well as people with permanent kidney failure.
• Medicare has two parts:
Part A: Hospital insurance
Part B: Voluntary supplemental medical insurance. 79

80. • Both parts contain a highly complex series of service benefits, and require some
payment by the individual.
• Medicare addresses the problems of old age, which have high health care needs and
low income.
• It was brought into action because voluntary health insurance system was unable to
provide adequate coverage above the age of 65 years.
• The dental segment of Medicare is limited to those services requiring hospitalization
for treatment, usually surgical treatment for fractures and oral cancer.
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81. 2. MEDICAID
• Name given to the title XIX of the United States Social Security Amendments of
1965.
• To provide funds to meet the health care needs of all indigent and medically indigent
persons.
• Joint federal state program covering at least these basic services
 Hospital services (inpatient and outpatient)
 Laboratory and X-ray services
 Skilled nursing facility services
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82.  Home health services for individuals aged 21 yrs and older
 Early and periodic screening, diagnosis and treatment (EPSDT) program for
individuals under 21 yrs and older
 Family planning services
 Physician services
• The ADA supported EPSDT program, enacted into law in 1968, because for the first
time a federal program mandated dental care for indigent children.
• Certain groups such as widows under 65 and families without children – ineligible
for the benefits of Medicaid.
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83. 3. NATIONAL HEALTH INSURANCE
• Launched in 2007 by the Indian government.
• It aims to protect unorganized sector workers below the poverty line from
major health expenses associated with hospitalization.
• The scheme is sponsored by the central and state governments.
• The state governments contract with insurance companies to manage financial
risk and run the schemes.
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84. • The benefits package is limited to hospitalization and surgical services. Outpatient
procedures, pre and post-hospitalization expenses, and a transport allowance are
also included, as are maternity expenses. A provider network consisting mainly of
private hospitals may be accessed for no fee by the beneficiaries.
• The network of hospitals is established by an insurer-appointed TPA, which
evaluates them on a set of quality of care standards.
• The central government contributes significant resources to subsidize premiums.
State governments are also responsible for a portion of the premium. Beneficiaries
pay a nominal registration fee (Rs.30 or $0.63) per annum. Additional
administrative costs not covered by premiums are borne by the state
84

85. CURRENT SCENARIO
• Health care financing in India is unique in several respects.
• The share of public financing in total health care financing is low compared to
average share in low and middle income countries or even relative to India’s share
in disease border.
• The beneficiaries of this limited public health financing or not only poor but also
well-off section of the society.
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86. • Over 80% of the total health financing is private, much of it takes the form of out-
of-pocket payments (i.e., user charges).
• Reliance on out-of-pocket is insufficient and less accountable.
• The world bank estimation (2002): One quarter of all Indian’s fall into poverty in
event of hospitalization.
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87. RECOMMENDATIONS
Need for participation of government funded public health institutions
 The challenge of risk pooling for remote rural households can only be met when
public health systems are also a part of such innovative health financing
mechanisms.
 The example of Karuna Trust’s work in Karnataka showed how by compensating
poor households for loss of wages and other indirect expenses and reimbursing
hospitals a certain amount for drugs and medicines in every case of hospitalization,
result in increasing access to health care.
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88. • One possibility therefore is to have a number of pilots undertaken on risk pooling
for poor households through NGOs, Self Help Groups, other community
organizations covering the indirect expenditures that are incurred in seeking health
care.
• Any kind of Health Insurance Scheme, which does not involve the public medical
facilities, would not succeed because, in majority of states, these are the only
facilities available in rural areas.
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89. • The involvement of the States could be worked out by designing a Plan Scheme by
the Ministry of Health and Family Welfare with subsidy being passed on to the
hospitals through the State Governments. In such a situation, the State Governments
can invite bids on ‘premium to the charged’ at their level from all the insurance
companies, both public and private.
• For availing of the subsidy from the Central Government, the minimum features of
the Scheme could be decided a priori and informed to the State Governments
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90. STRATEGIES FOR HEALTH FINANCING
• Currently, India’s health financing mechanism is largely out-of-pocket and a
declining trend in public finance.
• First, within the existing public finance of healthcare, macro policy changes in the
way funds are allocated can bring about substantial equity in reducing geographical
inequities between rural and urban areas.
• Presently, the central and state governments together spend Rs.250 per capita at the
national level, but this is inequitably allocated between urban and rural areas.
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91. • If allocations are made using the mechanism of global budgeting, as is done in
Canada for instance, that is on a per capita basis then rural and urban areas will both
get Rs.250 per capita.
• This will be a major gain, over two times, for rural healthcare and this can help to
fill gaps in both human and material resources in the rural healthcare system ratios
are adequately provided.
• The highly centralized planning and programming in the public health sector will
have to be done away with and greater faith will have to be placed in local
capacities.
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92. • Third, the governments can raise additional resources through levying “sin taxes” -
compulsory cesses and levies on products such as cigarettes, beedis, alcohol, pan
masalas and gutka, personal vehicles etc
• For instance tobacco, which kills nearly 1.35 million people in India each year, is a
Rs.350 billion industry and a 2% health cess would generate Rs.7 billion annually
for the public health budget.
• Likewise to reduce out-of-pocket financing of the healthcare system, policies need
to be quickly put in place for a system of health financing that will be a combination
of public finance and private contribution by establishing various collective
financing options such as social, collectives/ common interest groups etc.
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93. • At another level the healthcare system needs to be organized into a regulated system
that is ethical and accountable and is governed by a statutory mandate, which pools
together the various sources of financing and manages it for ensuring all the
members access to comprehensive healthcare.
• This will happen only if the entire healthcare system, (public and private) is
organized under a common umbrella, ideally through a single-payer mechanism that
operates in a decentralized way.
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94. CONCLUSION
• Private fee for service will likely to remain the predominant method of financing the
dental care in foreseeable future.
• Developing countries like India are in transition period during which alternative
feasible modes of financing and delivery services will evolve.
• Dental personnel and health care service organization can be certain that financing
of dental care is very important dynamic area, and there could be further expansion
and evolution with new concepts that might emerge.
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95. REFERENCES
1. Burt B, Eklund S: Dentistry, Dental practice, and the Community, 6th Ed, Elsevier
publications 2005
2. Pine C. Community Oral Health.1st ed. New Delhi: Reed Educational &Professional
Publishing Ltd; 1997.
3. Hiremath S: Textbook of Preventive and Community Dentistry, Elsevier Publication,
2007
4. Daly B, Watt RG, Batchelor P, Treasure ET. Principles of Dental Public Health.
Essential Dental Public Health. 2nd ed. New York: Oxford University Press; 2002.
5. Peter S. Essentials of preventive and community dentistry. 6th edition Arya
publishers; 2017
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96. 6. Park .K. Park’s textbook of Preventive and Social Medicine. 24th edition. India.
Bhanot publishers
7. Jong: Community Dental Health, 5th Ed, Mosby Publications, 2002.
8. Dr. Bhavna Singh. “Scope of Dental Insurance in India.” IOSR Journal of Dental
and Medical Sciences (IOSR-JDMS), vol. 17, no. 10,2018, pp 59-63.
9. Community Health Insurance – Karuna Trust. N. Devadasan, Karuna Trust
10. Duggal R. Poverty & health: Criticality of public financing. Indian J Med Res 126,
October 2007;309-317.
11. https://www.ysraarogyasri.ap.gov.in Last accessed on 14/9/21
12. https://www.esic.nic.in Last accessed on 14/9/21
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97. 13. https://www.india.gov.in>Rashtriya Swasthya Bima Yojana. Last accessed on
18/9/21
14. https://www.Karunatrust.org. Last accessed on 22/9/21
15. World Health Organization. Strategy on health care financing for countries of the
Western Pacific and South-East Asia Regions (2006-2010).
16. Garla BK, Satish G, Divya KT. Dental Insurance: A systematic Review. J Int Soc
Prevent Communit Dent 2014;4:S73-7.
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