It is high time to have a detailed discussion about dental insurance. What it is, and what it is not.
In part this is to help patients who have dental insurance utilize it properly, to their best advantage. And in part, this discussion is meant to help the approximately 50% of Americans who do not have dental insurance, to unlearn the destructive (and fatalistic) belief that, "I don't have dental insurance, so I can't go to the dentist."
The key reason that all-too-common thought is so damaging is that no dental problem ever gets better on its own. Cavities, tooth infections, gum disease, tooth crowding and misalignment and even oral cancer are all disease processes that only and always worsen with time, and never heal without professional intervention.
The fact is, and I shall prove it, is that folks who do not have dental insurance can seek dental care affordably through other means, which we will review in a bit.
The first thing to understand about dental insurance is that it is not insurance at all, but rather, it's a yearly coupon. A thousand-dollar coupon, to be sure, but still a coupon.
Now why do I say such an outrageous thing? Two words:
Inflation Calculator.
In 1967, when dental insurance first started in America, employers commonly purchased plans with $1,000 yearly maximums. The striking thing is, this number is still remarkably common today. In our experience in Philadelphia, some 95% of PPO plans from United Concordia, Delta Dental, Aetna, Guardian, Cigna and MetLife are set at $1,000 for their yearly maximums.
$1,000 in 1967 is the purchasing equivalent to $7,700 in 2019.
This is such an astonishing thing to realize that we must look at it from a number of different points of view, in order to even fully understand it:
(1) Your 2019 $1,000-a-year dental insurance plan has decreased in value to $130-a-year, if you compare purchasing power to what it was for a 1967-era patient.
(2) To have the same useful insurance product that a 1967-era dental patient enjoyed, you'd have to have nearly eight times that yearly maximum now. Or in raw dollars, add $6,700 to your present coverage maximum of $1,000.
(3) Dental crowns are a major procedure in dentistry, and thus a useful example to demonstrate principles. Crowns are often covered at 50% (when the various restrictions are navigated and a dental insurance company approves one). Meaning, the insurance company pays 50%, and the patient pays 50%. Plus a deductible. Oh yes, there's always a deductible too!
So. In 2019, $1,000 in yearly coverage (your big yearly coupon) usually allows a patient to have one crown done, with 50% coverage, and then preventive recall visits and X-rays and so on. At that point, coverage is all used up. If you need root canal treatment first (which is often covered at 80%), and then a crown, you will "max." This is the slang for reaching and then exceeding your yearly maximum and running out of benefits.
But the question presents itself: how many crowns could you do, on $1,000 in a year, if it was 1967 and you had terrible problems with cavities and broken, unsightly teeth? That was the heyday of Coca Cola and Pepsi, after all. Sugar water was destroying American teeth (and pancreases) even more than it does today.
Well, the answer may surprise you. Between reverse-inflation of dental costs and that 50% crown-coverage deal, on $1,000 you could have fifteen crowns done in 1967, in most private practice fee structures back in those halcyon days.
That's more than an entire arch of human teeth, if we leave out wisdom teeth. In 1967, your company's dental insurance was really insurance, because you could do a full mouth reconstruction, one arch in late fall and the other the next spring, and have all the cost offset by 50%.
Now in 2019, it's one crown and done. Or, as the armchair philosopher once opined, "What used to was, now it ain't."
We also have the issue of payroll deductions to deal with. Some employers provide dental insurance as part of their "package," and there is no overt cost to the employee. Many more employers, however, post payroll deductions for dental insurance premiums. Thus, the hapless modern employee gets 1/8th the value of their 1967 counterpart, and pays a lot more for the privilege as well.
Apparently on average, Americans pay about $360 a year, or between $15 and $50 a month, for dental insurance. There are large regional variations. We need to ask, is $360 per year worth it, when you're purchasing the equivalent of $130 when compared to your 1967 predecessor?
Please draw your own conclusions from all this. It's a lot to take in and process. As a practicing dentist, please allow me to share with you my two key conclusions:
For people with dental insurance, the product is, truly, a yearly coupon, if a rather large one, with various restrictions, and is not insurance at all.
For people who do not have dental insurance, the not-having is not a true barrier to care. Especially early care, before things get disastrous and really expensive to treat fully.
Many, many dentists around the United States have crafted in-house Programs which are not dental insurance, but rather, a means of making dental care more affordable and engaging.
It is generally best for dentists not to talk fees in public, but we need a basis for comparison here, and my own Program numbers are in public on our website, so here goes.
Our yearly enrollment for an individual is currently $332. This gives you two recall visits and professional examinations per year, as well as all X-rays, taken for any purpose. These professional services would normally total $459; or $519 every five years for most patients, when a full set of X-rays is due. Our Program also reduces the fee for all other professional services by 20%, with the exception of dental implants which are reduced for Program members by 10%. (Dental implant case lab bills often exceed the total GDP of some of the world's smaller nations.)
With such Programs, there are no monthly premiums or payroll deductions. For $332 you gain a cost savings over regular professional fees of $127 or $187, depending on what X-rays are taken.
And that's an example based purely on preventive services. Let's see what happens when a person has an ideal treatment plan involving six crowns, and decides to follow through on it. Let's further assume that the doctor does not participate in the dental insurance (but still bills to it), and that their fee is $1,300 for each crown. (I'm using this as a regional average sort of number, not my own.)
Dental Insurance Cost Analysis:
$1,300 x 6 = $7,800 total fee
Dental insurance pays the $1,000 maximum and that's it.
Patient pays that year, if they adhere to preventive care as well:
$6,800 plus $459 (just using our preventive fees for convenience) plus $360 in payroll deductions plus the inevitable $50 deductible = $7,669.
Our In-House Program Cost Analysis:
$1,300 x 6 = $7,800 total fee
$7,800 - 20% = $6,240 adjusted fee.
You may say "Count the $332 as well!" I disagree philosophically, but if we must, ok then, the number becomes $6,572.
And either way, my Program wins.
This hypothetical patient saves $1,097. To evaluate it another way, with our Program this patient pays 85% of what they would with dental insurance.
With increasing scale of treatment, it is worth noting, our Program performs better and better compared to dental insurance.
And that's the final point to consider. I always thought that insurance, of any kind, was meant to protect us from the financial effects of catastrophes. A complex and expensive surgery. An auto accident in which a vehicle is totaled. A hurricane that destroys entire houses, neighborhoods. The big stuff.
Isn't it odd how dental "insurance" works in the exact opposite way? The more severe a patient's dental disease, the less relative help it offers.
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Next time, we'll have a look at the endless restrictions placed upon what dental insurance can actually be used for, as well as have a go at how corporate dentistry in the U.S. distorts the dental insurance system to everyone's detriment.
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