- How happy are you with your dental coverage?
- Do you hope the next great reform debate tackles dental insurance?
As someone with a greater interest in the topic than most people, I thought I’d share some information on dental insurance. Then you decide if dental insurance should go through reform.
From Dental Chair to Dental Insurance
In a past life, I was a registered dental hygienist. Yes, the person who cleans your teeth.
Back then, the average time in practice was 2.2 years. While I hate being average, my dental hygiene career hit that mark – barely.
I transitioned into health insurance. I often said I used my dental hygiene education (pharmacology, microbiology, etc.) much more in insurance than I did in cleaning teeth.
If you followed my Medicare Basics series, you already know I’m old. While I haven’t qualified for Medicare eligibility yet, it is knocking on the door. Loudly.
So, my history with dental insurance is a long one. It started back in the mid-70s. Many of you were not even a twinkle in your father’s eye. And please don’t tell me your father wasn’t even born yet.
The dental insurance from the mid-70s shares many similarities to today’s coverage.
Past Dental Insurance
When I first started in dental insurance, it was not as widespread as it is today. Medical insurers typically limited what little coverage there was for dental treatment to one of three conditions:
- Accidental injury (like a broken tooth from your child’s mistaken belief he was the next Evel Knievel)
- Removal of impacted teeth (think wisdom teeth)
- Apicoectomy (removal of a root tip of a tooth, followed by sealing)
In the 70s, few employers offered dental insurance. However, one working segment was known for its dental coverage.
Labor unions pushed employers into sponsoring dental plans through their collective bargaining agreements. I worked with two of the largest unions (back then), Ford Motor Company and Republic Steel.
We Have Our Limits
In my early claim processing days, I repeated one phrase over and over.
Dental insurance was not designed to cover all treatment.
In fact, the early dental plans (and most today) contained a specific list of services. Even the typically generous labor union plans had limits.
The conventional plan covered the following.
- Preventive services (like cleanings and examinations) at 100%
- Basic services (like fillings and x-rays) at 80%
- Major services (like crowns, bridgework, and dentures) at 50%
Plans often had a low deductible (about $25) that applied to Basic and Major services. Plans also had $1,000 annual maximum for what they paid in one year.
That’s because nearly half a century later, plans today are very similar – if not identical.
Types of Dental Insurance
Basically, there are two broad categories of dental insurance.
- Dental plans sponsored by an employer
- Dental plans purchased by an individual
For purposes of this discussion, I am not including dental discount plans. Discount plans offer just that – discount on services. You pay the entire discounted fee. There is no employer or insurance company picking up a portion of it.
Acting as the stepchild of medical insurance, dental insurance created similar plan models (as illustrated below).
Child-like Dental Reform
Health reform’s Affordable Care Act (ACA) did not totally ignore dental insurance. However, the regulations primarily apply to children (pediatric dental services).
- Dental coverage for children is covered under ACA’s essential health benefits (those that must be covered)
- The requirement applies to individual plans and small group plans
- Children 18 years and younger qualify for covered pediatric dental services
- Adult dental coverage is optional
There is MUCH more to the confusing regulations for pediatric dental services. Are you surprised? For now, we’ll leave it at that.
According to the National Association of Dental Plans (NADP), 205 million Americans (64 percent) have some form of dental benefits. The illustration below is NADP’s breakdown of where Americans obtain those benefits.
While plans look very similar to those in my dental days, there have been changes.
- The good news – most employers offer some form of dental benefits
- The bad news – more employers are shifting the entire dental insurance premium to the employee
Dental Benefits Premiums
In the past, it was common for large employers to pick up the relatively, low cost for dental insurance. As health benefits spiraled out of control, employers made cuts where they could.
- Few employers cover the entire dental insurance premium
- Some have employees share in the cost
- Others moved dental benefits to voluntary benefits (employees pay the entire cost)
As discussed, the plan models and design have remained somewhat constant, with a few tweaks.
- Deductibles increased for some plans
- A few plans added covered services (e.g., dental implants)
- Annual maximums increased on select plans (e.g., from $1,000 to $1,500 or $2,000)
Does Today’s Dental Insurance Make Cents?
Low-cost dental plans may lure individuals into purchasing dental insurance. But, does it make financial sense – particularly, for individuals purchasing their own insurance?
In reviewing my mom’s Medicare options, we looked at dental coverage. Medicare does not cover routine dental care (like fillings, replacement of teeth, etc.). However, some Medicare Advantage plans offer dental care as an added benefit.
If you purchase your own dental insurance (not through your employer), you will discover the following.
- Most exclude coverage for major treatment (like crowns and dentures) for 6 to 12 months
- Some plans apply a waiting period to basic services, too, like fillings
- Monthly premiums range from about $20 to $50
Note: Employer-sponsored dental plans do not typically include waiting periods for major services.
Like any insurance, there are multiple options and variations. Let’s look at an example of a typical individual dental plan.
What happens to poor Mary the second year if she needs another crown?
- The good news – the plan covers the crown
- The bad news – the plan only covers 50% or $300
Mary pays a total of $840 ($540 in premium + $300 balance on crown). The example is oversimplified. Undoubtedly, Mary would have other expenses, like exams, x-rays, deductibles, and other out-of-pocket expenses. And, of course, premiums and dental fees tend to go up each year.
Whether you have dental coverage through your employer or you purchase it yourself, you can do a similar exercise.
- Add up your premium for one year (the portion you pay if your employer picks up part of the cost).
- Take your best guess for what care you’ll need.
- Check for waiting periods (like 6 or 12 months for major dental care).
- Know your deductible and annual maximums.
- How much does the plan cover? (e.g., 50% for a covered crown)
So, you tell me.
Does your dental plan make sense? Should dental insurance go through reform?
Infographics: Canva credit
Notice of Disclaimer –Cathy Miller is not an attorney or health care provider and cannot provide legal or health care advice. The information provided is for your general background only, and is not intended to constitute legal or health care advice as to your specific circumstances. We recommend you review legislation with legal counsel and visit your physician for health care issues.