What is to 'Capitalize'. Capitalize is an accounting method used to delay the recognition of expenses by recording the expense as a long-term asset. In general, capitalizing expenses is beneficial as companies acquiring new assets with a long-term lifespan can spread out the cost.
For orthodontics, most, if not all plans have a lifetime maximum amount that the carrier will pay for treatment. This is typically anywhere from $750 to $4000 and the patient is responsible for the remainder of the orthodontic cost.
On 7/01/2014, Cigna is the new administrator for the Enhanced plan benefit 12 months of active treatment remaining Member rate for active treatment per month is $120 Previous plan paid 50% to a lifetime orthodontia maximum of $1,500 In this example, Cignaâs Enhanced plan would contribute 50% of the monthly orthodontic payments for the 12 months of active treatment remaining. This breaks down to $60/month (50% of $120), for each of the 12 months, for a total of $720 from Cigna and $720 from your previous carrier ($1440 accumulated towards the lifetime maximum).