They can also redirect that traffic to their own DNS servers, so you think you are using 3rd party DNS, when you are actually still using theirs. This became legal when the Trump administration got rid of net neutrality legislation.

OpenDNS has an article on how to test if your ISP is doing it. https://support.opendns.com/hc/en-us/articles/227988727-How-can-I-tell-if-my-ISP-Allows-Third-Party-DNS-Providers