A grass-roots voter initiative on November’s Massachusetts ballot could represent an initial step toward nationwide dental insurance reform, advocates say.
“This is kind of the bellwether for everyone across the country,” Brian Monteiro, director of governmental affairs and public relations at the Massachusetts Dental Society says in an American Dental Association podcast. “Eyes are on us.”
If passed by voters on Nov. 8th, the measure would require dental insurance carriers to spend at least 83% of premium dollars on patient care or rebate unspent portions to policyholders.
Under the Affordable Care Act, medical insurers are required to minimally operate at an 85% medical loss ratio for larger carriers, and 80% for smaller health insurance companies. In 2006 Massachusetts became the first state to implement a medical loss ratio that holds medical plans to an 88% standard. Dental insurance companies, though, are exempt from such provisions.
Other states’ efforts
States have toyed with similar efforts to force dental insurers to reveal loss ratios and set minimums. A Maine bill enacted last March establishes a minimum medical loss ratio of 80% for dental plans and requires rebates to be provided in any year in which a dental plan’s medical loss ratio is less than the minimum.
A California law, the Dental Plan Transparency Act, required insurers to report loss ratios after it was found the average dental loss ratio was 61%, far below the 76% national average, with some plans falling as low as 4% spent on patient care.
“If medical plans can clear an 88% medical ratio, we feel there’s no reason why dental insurers can’t hit that 83% number,” said Dr. Andrew S. Tonelli, D.M.D., co-chair of the Massachusetts Dental Society’s Government Affairs Committee in the ADA podcast. “If this bill passes, I’m going to have the confidence as a provider that my patients are getting a reasonable deal with their money. And I can’t say that right now, which is a little bit frustrating as a provider.”
The ADA is supporting the ballot initiative, which was kicked off by a single orthodontist in the state who spent his own millions gathering voter signatures for the referendum, contributing $5 million on the Massachusetts campaign.
“For months, the MDS and ADA have been working together in developing a campaign strategy that will enter a more public facing phase over the coming weeks,” the ADA said in a release announcing its support. “Both organizations plan to expend the resources necessary in support of campaign activities to educate and engage voters on why they should vote “YES on Question 2” to pass this important, patient-centered referendum.”
Not surprisingly, dental insurers have lined up against the proposal. Seven donors have thus far reported contributing $5 million to the “No” campaign, almost all of it from the giant Delta Dental. Others, such as Sun Life, Concordia, and MetLife, have pitched in with smaller amounts.
Fundamental differences cited
The insurers argue that dental insurance is fundamentally different than medical insurance. Potential dental insurance company losses for payout of patient benefits are more actuarially predictable, they say. Most dental insurance companies impose yearly maximum payouts limited to about $1,000 to $1,500, where medical insurance may be on the hook for unlimited sums.
Dental insurance plans mostly cover low-cost preventative care, and barely cover more involved care like crowns and bridges.
Medical insurance is almost the opposite, paying out minimal amounts for basic services but really covering serious illnesses, expensive diagnostic testing, and rehabilitation.
Even the ADA concedes that dental insurance belongs in a separate category.
“Dental benefit plans are not really insurance in the traditional sense, but are designed to provide you with assistance in paying for your dental care,” the ADA says in public documents.
Delta Dental of Massachusetts, which reported a 2019 loss ratio of 74%, close the national average of 74%, contends that the Massachusetts proposal does not allow carriers to exclude from the loss ratio calculations investments in customer online portals, disease management, or fraud prevention, from the loss ratio calculations, while health insurers can. This, said Delta Dental, could discourage dental carriers from investing in those programs. It also warns premiums could rise severely if the referendum passes.
An analysis by Tufts University’s Center for State Policy Analysis, was down the middle in its evaluation. The reports said insurers may actually lower premiums and streamline administrative functions or cut profits. They might also begin covering more procedures which would allow dentists to charge higher prices.
Overall, the Tufts reports said, the ballot question probably won’t significantly impact consumers.
Doug Bailey is a journalist and freelance writer who lives outside of Boston. He can be reached at [email protected].
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