Is it just me or do you find that statistic a bit surprising?
Okay, so maybe you aren’t a dental geek like I am. As a former dental hygienist (way, way in the past), I have always had a soft spot for all things dental.
That is one of the reasons the news headline from the National Association of Dental Plans (NADP) caught my eye.
Commercial Dental Benefits Enrollment Jumps Dramatically in 2012
I thought I would check this out.
The report, 2013 NADP/DDPA Joint Dental Benefits Report, released by NADP and Delta Dental Plan Association (DDPA) revealed the following.
- At the end of 2012, 187 million Americans had dental coverage
- The results were an increase of 11 million people
- That equates to approximately 60 percent of Americans
Perhaps a more accurate assessment would be the number of Americans who actually use their dental coverage.
Reasons to Smile
Dental benefits remain a popular employee benefit – for various reasons.
Stays the Same
Dental insurance is one employee benefit employers tend to leave alone.
- With the emphasis on escalating medical costs, who has the time to analyze dental coverage?
- The premiums are relatively inexpensive
- Even if moved to voluntary status (employees pay the whole premium), dental premiums are affordable for most employees
Unfortunately, the lack of attention to dental also contributes to benefits being very outdated (in my humble opinion).
Kids and Braces
In my days working for insurance companies, the biggest draw for dental insurance was kids and braces.
Mom and Dad may not care about their dental care, but they definitely cared about straightening Little Johnny’s (or Joanna’s) teeth.
That is why insurance companies (being the smart little risk analysts they are) would not sell Child Only dental coverage. They wanted Mom and/or Dad’s premium dollars to balance out all that money spent on braces.
The report did reveal the rather dismal number of people who buy dental insurance in the individual market (like those of us who are self-employed).
- In 2012, 5 percent of the population had individual dental policies
- That was up from 2.4 percent the prior year
Now, for some perspective.
Okay, my perspective (for what it’s worth).
According to the NADP/DDPA report, nearly half of individuals have coverage through a commercial dental plan.
Since I didn’t want to shell out $400 for the report, I do not have a breakdown of dental coverage by plan type. However, one fact that jumped out at me was the inclusion of dental discount plans in the enrollment figures.
Dental Discount Plans
- Individual and Employer-sponsored: Once sold primarily as an individual policy (you buy your own insurance), dental discount plans moved into employer-sponsored plan menus
- Employee Contribution: The NADP report shows 99 percent of discount plans involve some form of contribution (as illustrated in the chart below) by the covered individual
- Provider Networks: Discount plans use provider networks in which dentists agree to participate in exchange for accepting discounted fees as payment for their services
- Pay Full Discounted Fee: Individuals enrolled in these plans pay the full amount of the discounted fee
My guess is that most individual policies are discount dental plans.
“Traditional” dental plans like dental HMOs or dental PPOs often exclude major dental work (like crowns, bridgework or dentures) in the first year of an individual policy.
That makes them unattractive to people purchasing their own dental insurance, who are often older individuals in need of exactly that kind of dental work.
In my view, calling dental discount plans insurance is not an accurate depiction.
Insurance is a contract with a company to provide coverage for a loss in exchange for a premium.
No company pays you benefits for a dental discount plan.
- You could negotiate a discount with a dentist on your own.
- Yes, the discount plans eliminate the hassle
- But, you are still the one responsible for the full discounted fee
Consistent with the current state of health benefits, employers are shifting more of the cost for dental coverage to their employees.
An increasing number of employers are offering dental coverage as a voluntary benefit. As previously noted, voluntary benefits means employees pay the full premium.
The NADP/DDPA press release for the report does not indicate if the enrollee contribution percentages (shown below) reflect just employer-sponsored plans. I presume it does as enrollees in an individual policy pay the entire premium.
Generally, indemnity plans have the following characteristics.
- Fee-for-service plans
- Enrollees can visit any dentist they choose
- There are no network restrictions
The richness of the indemnity plans are probably reserved for the executives, which could be a reason for the low percentage of enrollees who have to kick in on the premium.
My analysis is by no means perfect; however, neither is the state of dental insurance.
- Nearly 32 million in the U.S. have no dental insurance
- Discount dental plans are not really insurance
- Most coverage is inadequate for dental needs
On that last point, when God invented dental insurance, it was never intended to cover all of our dental care.
But, with typical annual limits of $2,000 or less, your coverage can hit its limit with a cleaning, exam, x-rays, and a single crown.
Even with insurance, you are left with healthy out-of-pocket expense.
The headlines may boast a huge jump in dental enrollment, but if we are not receiving the dental care we need (either by choice or by lack of adequate insurance), is the news really anything to shout about?
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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.