If your company is already offering health insurance to your employees, should dental insurance plans be included as a similar benefit to them?
It is a question many business leaders are asking themselves in light of the Affordable Care Act, which requires by 2014 that individual and small-group health plans sold on the state-based health insurance exchanges and outside them on the private market cover pediatric dental services as part of disease prevention.
The Centers for Disease Control reports that approximately 23.7 percent of adults ages 20-64 have untreated dental caries (tooth decay). If left untreated, these caries can lead to tooth loss and more aggravating conditions including disease and other complications. This situation has a large impact on businesses – one survey estimates among adults, 164 million work hours are lost each year due to dental-related illnesses.
Given this impact, more employers are discussing whether to provide group dental insurance as a benefit.
Factors that should be considered include:
1. Overall Health Prevention
Approximately 81 percent of people with dental benefits visit the dentist twice a year or more, while only 34 percent of people without dental benefits do the same. To combat this trend, a company can set a precedent by encouraging visits to the dentist, offering group dental insurance and stressing to employees that it is just as important to take preventative care of their teeth as the rest of their bodies.
2. Costs Savings on Average
Estimates in 2012 from the Centers for Medicare & Medicaid Services’ National Health Expenditures team project an increase in expenditures for dental services from $104.8 billion in 2010 to $179.8 billion in 2021. Those expenses can be reduced for your employees because some plans save participants more than $100 yearly compared to those without insurance who receive the standard two exams and cleanings and a set of X-rays from dentists. For someone needing standard dental care, an affordable group plan can be a real bargain and an incentive for joining and/or staying with a company.
3. Employer Paid or Voluntary
Employers who decide to offer dental coverage must determine if they will subsidize any of the cost of the program or if they will offer the product as a voluntary option. The latter choice provides access to the program by employees but passes the cost of payment onto them.
4. Funding of the Benefit
If you decide to pay for your employees’ dental insurance, consider how you will finance the cost. Should you purchase a fully insured product or fund the dental plan yourself? For larger employers, self-insurance may make sense, because dental costs are fairly predictable, and most plans have annual caps of $2,000 or less, which lowers the overall financial exposure. Additionally, self insurance allows employers to avoid state premium tax and has the potential of avoiding other healthcare reform-related taxes and administrative issues.
Weighing the benefits and drawbacks of group dental insurance can be tricky, based both on the considerations previously listed and a company’s present circumstances. If you need additional assistance on this matter, please feel free to contact Hill, Chesson & Woody with any questions you may have.