Direct vs. leased dental networks: What employers need to know

When you choose a dental plan, the network behind it matters more than most people realize. Some insurers lease networks, essentially renting access to dentists rather than contracting with them directly. However, a directly managed network, supported by long-standing and transparent provider partnerships, can dramatically improve cost, access, and the overall experience.

While leased networks can make an insurance plan appear larger on paper, they often come with hidden drawbacks. Data from the 2024 Milliman Network Study, one of the industry’s most robust analyses of dental network performance, shows direct networks deliver stronger, more consistent performance than leased networks.

Here’s why that matters, and what it means for your organization.

1. Direct networks help control costs more effectively

When an insurer manages its own network, it negotiates fees directly with dentists, meaning the prices are known, consistent, and monitored. This helps keep costs predictable for both the plan and your employees.

Leased networks, however, pull dentists from multiple different agreements. Those dentists may have different contracted rates depending on which network “version” is being applied. That can lead to:

• unpredictable out-of-pocket costs

• inconsistent savings

• higher variability in claims

• more confusion for employees

The 2024 Milliman national data shows that strong PPO networks, like Delta Dental’s, consistently deliver deeper and more reliable discounts, which means lower costs overall for members and employers.

In short: when the network is directly managed, fees stay consistent and savings stay predictable.

2. Better quality control and a higher standard of care

Since we contract directly with dentists, we’re able to ensure:

• strong credentialing standards

• continuous quality reviews

• fast, accurate claims processing

• direct support for providers

A leased network model can’t offer the same level of oversight because the insurer is essentially “borrowing” dentists from another network. That makes it harder to enforce quality standards or stay aligned on policies.

With Delta Dental of Tennessee, the accountability is direct and clear. Our dentists contract with us, not with a third-party, so we can maintain the quality and reliability employers expect.

3. A more stable and dependable provider network

Every employer wants a plan with a large, high-quality network. Network size isn’t all that matters though, network stability can have a big impact.

The Milliman study found that large, well-established networks continue to grow steadily year after year. That means more access points and more choices for employees.

Leased networks, on the other hand, can change quickly. Because these dentists aren’t contracted directly with the insurer:

• dentists may be added or removed without notice

• directories can become outdated

• employees may lose access to a provider unexpectedly

For an employer, this instability can create confusion and a negative perception of the benefits you worked hard to provide.

Our directly managed network is built for long-term relationships, not temporary participation.
This means more reliable access, lower turnover, and an overall smoother experience.

4. Members actually use the network more

A dental plan is only valuable when employees feel comfortable using it. Direct networks tend to have higher “in-network usage,” which simply means: More people see dentists who are in the plan’s network, where their costs are lowest.

With leased networks, dentists may not even realize they’re part of all the different plans that access them. This can create awkward moments for employees who thought a dentist was in-network, only to find out at the appointment that the dentist wasn’t participating in their specific plan.

That leads to frustration, unexpected bills, and lower member satisfaction.

Delta Dental’s direct approach removes this guesswork. Our dentists know exactly which plans they participate in, and members can count on accurate provider listings and reliable access.

5. Simpler claims and fewer billing surprises

One of the biggest frustrations employees can face is receiving an unexpected bill after what they believed was a routine visit.

Since leased networks rely on multiple fee schedules and different types of agreements, billing can become complicated. Even providers sometimes struggle to understand which rate applies.

With our directly managed network, dentists work from a single, clear contract, which means:

• fewer claim errors

• less paperwork

• faster processing

• fewer surprise charges for your employees

This simplicity reduces headaches for everyone, including your HR or benefits team.

What This Means for Employers

Choosing a dental plan built on a leased network may look similar on paper, but the experience, and the results, can be very different. Here is a side-by-side look at the two network structures.

A dental plan is only as strong as the network behind it. When that network is directly built, maintained, and supported, as it is at Delta Dental of Tennessee, everyone benefits: employers, employees, and dentists alike.