The dental industry continues to reel nearly two years following the passage of the Patient Protection and Affordable Care Act, which included several mandates that might change the face of the way dental care is delivered within, and outside of, state-run health insurance exchanges.
Last December, the Health and Human Services Department gave states the choice of "benchmark" plans rather than setting a nationwide set of minimum health benefits, which will leave the responsibility with more states and send groups representing the dental industry and consumer groups to lobby for their interests.
In addition to the legislative constraints, the downturn in the economy led the industry to its first ever enrollment decline in 2009 at 5.7%. However, national dental enrollment rebounded somewhat in 2010 with a 4.5% increase. At the same time, the economy is making employers more likely to consider adopting voluntary dental plans.
Despite the challenges, employers appear to be maintaining their commitment to dental benefits. Recent research shows 70% are likely to continue to offer dental outside of exchanges, compared to 40% that will take medical benefits to exchanges, according to a study conducted by the National Association of Dental Plans.
Pediatric plans remain a concern
Among the dental industry's biggest concerns, however, is that PPACA bundled pediatric dental coverage, leaving dental professionals grappling with how it will be offered in the small and individual market. The impact could be most keenly felt among the 1.65 million small businesses that offer dental coverage, covering 34 million adults and 29 million children.
"If parents drop children from the policy there is the potential that for children covered under medical, their dental home will be disrupted," says Evelyn Ireland, executive director at NADP. If coverage is disrupted, about half of adults aren't likely to purchase dental coverage for themselves.
The problem with that, of course, is that people without dental coverage are 2.5 times less likely to seek dental care. The cost of dental coverage is relatively small, about one-twelfth the cost of major medical. A block of lawmakers believe in the importance of coverage outside the exchanges; 23 senators and 33 members of the House sent a letter to HHS Secretary Kathleen Sebelius, urging her to recognize dental coverage outside of the exchanges.
Carriers may end up providing the minimum coverage specified by PPACA in order to remain price competitive, but might also offer stand-alone "riders" providing more comprehensive coverage if permitted under the exchange regulations. However, if medical coverage purchased through the exchange already includes the required pediatric essential benefit, stand-alone dental carriers will either have to carve out the pediatric coverage from their basic plans or duplicate the coverage already provided for children, according to Mitch McGlynn, president at Dominion Dental.
"Some employers may weigh the advantages of offering benefits either in or out of the exchanges versus dropping coverage altogether and paying the penalty," says McGlynn. "Others may be apprehensive about making a change to a new, unproven distribution system." Because an employer's benefits program is often an important part of employee recruitment and retention, a change to a less comprehensive plan under the exchanges may be considered a downgrade in coverage and have a correspondingly negative effect on employees.
The move to give states the flexibility to dictate where dental will go also complicates things, especially from an administrative perspective.
Stacia Almquist, vice president of dental at Assurant Employee Benefits, says that if states have different products to make sure the industry is able to meet the minimum benefits, the claims process will become quite complex.
Her main issue, she says, is "to understand and make sure we can get clarification on what we can sell in the exchanges and outside the exchanges when they go live in 2014." Currently, they still don't know if they'll be able to sell pediatric coverage outside exchanges.
Meanwhile, in the midst of the confusion around pediatric dental coverage, preferred provider organizations continue to be a growth product, with a 5% jump last year. Three-fourths of all dental coverage remains within these networks, where there is a larger network and greater discounts.
That choice and transparency must be carried into the exchanges by allowing stand-alone dental to include pediatric coverage, according to Album.
"It's about the consumer being able to choose the dental and medical plan they want and not be forced to buy a dental plan just because it's connected with the health plan. All the choices that are available in the marketplace should be available inside the exchange."
According to another study by NADP, there was a decrease in the purchase of bundled and embedded products, which will happen in the small group market with PPACA. That separation of care is important because delivery of care is so different, Ireland says.
"Before 1980, there was a little more embedding of benefits in the medical product, but it was employers that demanded that there be more dental coverage because the dental coverage within medical was just prevention," she says. Employers wanted more access to treatment and products, which took it into more of a specialty. She still predicts that the markets will remain separate.
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