What is Cost Sharing in Dental Insurance?

January 20, 2023

Partner Post: We are proud to partner with Delta Dental of Washington, the state’s leading dental benefits provider, for our Association Health Plan. Our partnership with Delta Dental allows us to offer our employer-members a comprehensive health and medical package that includes access to quality local care and a national network for their employees. Delta Dental is committed to providing affordable and high-quality dental plans for businesses of all sizes across the country, making it a perfect fit for our Association Health Plan.

In the United States, virtually every type of insurance, from health insurance to auto coverage, incorporates some sort of cost-sharing element. But what is cost-sharing when related to dental insurance? Let’s break down the details of cost-sharing, how it works, and why it benefits you and your insurance plan carrier.

What Is Cost-Sharing?

Cost-sharing in dental insurance means that you and your insurance plan have each agreed to pay a specific portion of your medical expenses over the course of the year. When you sign up for a dental plan, you enter into an agreement that should clarify how much each party is responsible for paying. The amounts you agree to pay for covered dental services are called your out-of-pocket costs and will either be a fixed dollar amount (a deductible or copayment) or a percentage of the cost of the treatment (coinsurance). Your insurance plan would pay for the rest. (We’ll discuss more what deductibles, copayments, and coinsurance mean later in this article.)

Cost Sharing – Insurance Definition

Cost-sharing is a structure in which your insurance plan pays for a portion of covered services while you pay out-of-pocket for the rest. It’s important to keep in mind. However, that cost-sharing only applies to covered services. If you receive a treatment or procedure that isn’t covered by your dental insurance plan, you’ll have to pay for those medical expenses on your own. What’s more, cost-sharing can also affect where you receive treatment. Seek dental care from out-of-network providers (even if your insurance covers it). You’ll generally be responsible for greater out-of-pocket costs than if you make sure to stick with in-network providers only.

What Is the Main Purpose of Cost Sharing?

The purpose of cost-sharing insurance is to share the costs of your medical care. This can help save money. While this may sound like it only benefits the insurance carrier, it also benefits those on their plans. But by keeping their own costs in check, an insurance company can provide monthly premiums at a lower rate. Cost-sharing structures also offer more options, so you can find a plan that suits your individual needs. When receiving dental services, you may opt for higher monthly premiums but lower cost-sharing. This can be a great option for people who know they will need more extensive care than just twice-yearly cleanings or the occasional filling.

On the other hand, if your teeth are healthy, a lower premium with higher cost-sharing might be a better fit. You’ll save money on your monthly payment and likely won’t have to worry about needing or paying for many expensive services.

How Does Cost-Sharing Work? Understand These Out-of-Pocket Costs.

The monthly premium is the first thing you can think of when it comes to the cost of dental insurance. This is the fixed rate that patients pay insurance carriers monthly in exchange for coverage. While this is an important part of what you pay for dental insurance, it’s not considered a part of cost-sharing. Monthly premiums are solely out-of-pocket expenses.

Once you pay the monthly premium, however, that’s when cost-sharing comes into play. Dental insurance has three different types of cost-sharing: deductibles, copayments, and coinsurance.


Your deductible is the set yearly dollar amount you must pay directly to your dentist for covered services before your insurance plan begins to pay. Annual deductibles generally range between $25 and $100. The great news is that certain services, such as preventative treatments, are often not included as part of your deductible requirement. This means you can receive your twice-yearly cleanings and related services (exams, X-rays, and fluoride) without any deductible costs.


After you pay any deductible you have, that’s when your dental insurance kicks in. But there are still out-of-pocket expenses to consider. Like deductibles, copayments (more commonly called copays) are predetermined flat rates you must pay for dental office visits and/or treatments. Plans with built-in copayments often have cheaper monthly premiums but cover a smaller portion of service costs (or may not cover them at all). If you have an insurance plan with a copay, the amount you pay for each service is fixed — regardless of the actual treatment cost.


Instead of fixed copays, benefits carriers often apply a coinsurance cost. This works because the dental insurance company will cover a specific percentage of the allowable cost of restorative and major dental services (fillings, crowns, root canals, non-surgical extractions, etc.). The remaining percentage — the coinsurance — is what the patient must pay directly to their dentist. Depending on the service, it’s common to pay anywhere between 20% and 50% of the total cost of the procedure. The lower your coinsurance, the higher your monthly premium will typically be. Many people prefer to pay a slightly higher monthly fee to avoid getting hit with larger bills for services later.

Other things to keep in mind: Annual maximum and out-of-pocket maximum

Though not part of cost-sharing, another thing to keep in mind is the annual maximum, which is part of many dental insurance plans. Usually, between $1,000 and $2,000 a year, the plan’s annual maximum is the total amount your insurance carrier will pay towards your dental services in a single benefit period. Unlike most health insurance plans, dental insurance doesn’t come with an out-of-pocket maximum for the patient. If you’ve reached your plan’s annual maximum and you still need additional care, anything further would have to be paid by you out-of-pocket and there’s no cap or limit on what that amount could be.

How to Make the Most of Dental Insurance and Cost-Sharing

The best the way to take advantage of your dental insurance is to make sure that you’re going to all your preventative dental exams, which should come at very little or no extra cost to you. Should a problem arise that needs additional attention, don’t put it off. Addressing issues early is the best way to save yourself money. Left untreated, something as simple and relatively inexpensive as a cavity could easily turn into the need for a root canal and hundreds of dollars out-of-pocket.

Written by: Caryn Whiteford, Delta Dental August 2, 2022. Link to original article can be found here.