What Is the Difference Between a Dental Insurance PPO & Indemnity Plan?

by Neil Kokemuller ; Updated July 27, 2017
A dental indemnity plan allows patients more treatment flexibility.

Preferred provider organization and indemnity plans are very closely-related group dental insurance structures. The primary distinction is that indemnity plan providers aren't normally reimbursed at the same level as PPO plan providers.

PPO Basics

A PPO dental plan includes the insurance company, the insured members and networked providers. When you get in-network dental coverage, the provider agrees to contracted rates with your insurance company. Therefore, your co-payment and coinsurance responsibilities typically are limited by the policy terms. You often have a deductible for different categories of dental care with a PPO plan.

Indemnity Plan Basics

An indemnity plan is often known as a fee-for-service plan. A primary advantage of an indemnity plan relative to a PPO is that benefits typically are consistent across a broader range of providers. As a result, you have more choice in who you see for dental care. However, the insurer doesn't maintain the same contractual relationships with providers in many indemnity plans. Therefore, your out-of-pocket expenses on services often are higher. Indemnity plans also have a benefits cap, such as $1,000 per year, according to Delta Dental.

About the Author

Neil Kokemuller has been an active business, finance and education writer and content media website developer since 2007. He has been a college marketing professor since 2004. Kokemuller has additional professional experience in marketing, retail and small business. He holds a Master of Business Administration from Iowa State University.

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