© Copyright 2002
Rogers Media. The following article first appeared in the January 2002 edition
of BENEFITS CANADA magazine.
Dental plan check-up
Changes to the Ontario Dental Association's fee
guide are being watched by plan sponsors across Canada. This is a good
opportunity to review what your plan is paying for--there may be more than a few
surprises.
By Dr. Gerald Leavens
A recent edition of Ontario Dentist, a publication
of the Ontario Dental Association (ODA), contains an editorial that declares in
its title: "Any Decline in Dental Insurance Will Hurt Your Practice." The
editorial ends with a cautionary note that states "any decline in dental
insurance coverage will have serious ramifications for Ontario dentists." This
is, as the editor puts it, "the harsh reality."
In recent years, dentists have rarely worried about
dental insurance. They probably worry about the viability and continuity of
dental plans (that help keep them among the top two or three income producers in
the country) about as much as they agonize over the sun coming up tomorrow. But
for the first time since dental plans became a reality in Canada about 40 years
ago, there are storm clouds on the horizon. Dentists may have no one to blame
but progress, the economy, and to some extent, themselves.
Dental insurance plans differ from other insurance plans,
such as drug coverage and life insurance, because they really aren't insurance
in the strictest sense of the term. We hope not to have to use benefits such as
hospitalization and prescription drug coverage, and we spend time and money
preventing any need for these benefits. Yet with dental insurance, most plan
members actually plan, anywhere from six months to a year in advance, for the
express use of the benefit. The member feels it is his or her right to use the
dental plan regularly.
Not surprisingly, more and more articles have been
written lately about the regular and predictable increase in dental prepayment
costs, which are estimated to have grown in the past 10 years from 7% to 10% per
year. That is the harsh reality for plan sponsors. Yet few cost-containment
solutions have been presented for a problem that is taking on ever-increasing
significance.
ASSESSING THE SITUATION
What, exactly, has happened to the cost of dental plans? Have
fees increased that much? Are plan members receiving more costly dental
treatment? Is fraud playing a role in the escalation of costs? Are dentists 'up
selling' their patients to more expensive treatments? Does excessive use play a
role in cost increases? To varying degrees, all of the above are contributing to
the problem.
A few years ago, dental recall packages were introduced
to the Ontario Fee Guide, among other provincial guides. The package
combines the most common procedures performed at a check-up into a single
procedure code, making them about 15% to 16% less costly than the sum of the
procedures together. Allowances were also made for children, whose fees were
less than those of adults.
But this month, the ODA recall package codes disappear.
They will be replaced with individual procedure codes, which have no reduced
children's fees, and which, collectively, will be about 10% higher than the
former package. Many employee groups, carriers and brokers are concerned that
increases in the funding of dental prepayment plans--combined with regular fee
increases, a desire among dentists to maximize incomes and a complete change in
the fee calculation method--may reach as high as 15% in the first year following
these changes. Hopefully, these predictions are exaggerated, but by how much is
not yet known.
The ODA feels that the changes are important in one way:
they will bring many people who, at the moment, do not have dental insurance and
receive little care, into dental offices. This is the driving force behind the
changes and it impacts employers offering dental plans. It is also likely that
other provincial dental associations won't be far behind in adopting similar
changes.
In the September 2001 issue of Ontario Dentist,
R.K. House, an economist, professor at Toronto's York University and one of the
architects of the 2002 ODA Fee Guide, states that many dentists have
determined "what fees they charge in their practice should be increased or
decreased in order to increase demand for services and maximize their incomes."
Indeed, most dentists automatically charge the high end of the range. Despite
this evidence, the creators of the new fee guide feel that dentists will use it
only as guidance for setting their own specific fees.
The designers of the 2002 ODA Fee Guide believe
that dental fees will increase at about the level of inflation. However, in the
October 2001 issue of Ontario Dentist, House states: "... a guide with
high restorative fees but low extraction fees encourages patients to have teeth
extracted. Thus, high restorative fees should be coupled with high extraction
fees if we want to induce the patient to make the right healthcare choice." He
adds: "The membership has ... indicated that it wants a fee guide that helps the
individual practitioner maximize the economic potential of his or her practice."
This doesn't sound like fees will merely increase at the rate of inflation.
EXAMINING FEE HIKES
There are other factors besides fees driving up the cost of dental benefits.
Here are a few:
> Dental
implants. A costly and successful way of replacing teeth, dental implants
are now as common as bridges. Although most dental plans do not cover this
procedure, there is strong pressure from dentists to include them in plans.
> Amalgam
fillings. These silver and mercury fillings are on their way out due to the
health fears (unsupported by the major dental organizations) of many patients.
In many cases, they are being replaced with white fillings, which are more
costly.
> Inlays and
onlays. There is strong pressure from patients and dentists alike to use
inlays and onlays, fillings made from an impression of the hole in the tooth out
of gold, porcelain, ceramic, acrylic and other aesthetic and long-lasting
materials. The cost of these restorations is often four to five times that of a
traditional filling. The cost of new materials in place of both simple and
complex fillings has also escalated.
> Surgery.
Costly root canal therapy and periodontal (gum) surgery is now being performed
more often in order to save teeth that would have simply been extracted only a
few years ago.
> Practitioner
abuse. Most dentists work hard and literally have no time to be anything but
scrupulously honest in their treatment of patients. But a small number of
practitioners abuse dental plans and overuse benefits. They affect the cost of
these plans. As computer programs become more sophisticated, and more insurance
carriers develop investigation departments, this is one problem which, with the
support of the dental profession, will be reduced.
SOLVING THE PROBLEM
So, what should plan sponsors do about the spiraling cost of dental plans?
You could drop the dental benefit altogether or arrange for a group of cut-rate
dentists to whom your employees must go or forsake their benefits. These
so-called preferred provider organizations are often used in the U.S. In Canada,
we are more attached to our own practitioners, medical or dental.
Employers, employee groups, unions as well as brokers and
insurance carriers must participate in the day-to-day evolution of this rapidly
changing benefit. Modern dentistry is metamorphosing so quickly and dramatically
that unless plan providers understand it, they may be overtaken by change.
Data mining is also part of the solution. Unless we see
where the dollars are being spent, we have no idea as to how to turn down the
tap. If you and your insurance carrier aren't auditing submitted claims, now is
the time to start. Find out exactly how many procedures not listed as benefits
by your aging dental plan are being paid for regularly. Find out how many of the
new procedures introduced yearly by the dental profession (last year alone there
were dozens) have been automatically added to your list of covered benefits.
Insurance carriers try hard to keep up with change and
are successful most of the time. But there is a conflict in what the dental
profession would like to see covered and what employers can afford to cover.
While each employer is unique, the relationship among plan sponsors, carriers
and brokers must be interactive.
More specific solutions include placing limits in your
policy to control the abuse of exam billing. This includes regular recall
(check-up) appointments, which, at every six months, may be occurring too often.
Ensure that there are controls in place to contain other types of exams. How
many units (15-minute time slots) of tooth scaling are being paid for? Your plan
may allow three or four hours of this procedure annually, when an hour per year
may be more reasonable.
Check to see whether your plan includes a clause that
allows alternating payment for acceptable, lower-cost replacements for missing
teeth. The benefits can be applied towards the cost of more expensive devices if
the patient wishes, which was probably not your intent.
As well, you may be paying for lab fees, when
restorations are actually being produced in the dentist's office without the
involvement of a commercial laboratory, along with payment for the use of office
space and equipment during certain dental procedures. Are these expenses you
want to cover? The answer may be 'yes,' but as a plan sponsor, you need to be
fully informed of the terms and costs.
Fees are often presented as a range from $25 to $100, for
example. If your plan pays current fee guide rates, the data should be audited
to determine how often the dentist's computer simply plugs in the high-end fee
by default. In addition, your plan may be overly heavy with payments for luxury
procedures such as porcelain inlays or cosmetic veneers to cover the front of
unaesthetic or darkened teeth.
Periodically, when reviewing a dental policy, I am
shocked to see codes for procedures such as silicate fillings still listed in
the plan formulary. These natural-coloured restorations have not been used for
many years. When the code for this procedure appears in a policy, I know that
plan sponsors will be pleased to discover how a policy review can reduce the
overall expense of their plan.
The savings brought about by tightening controls on the
frequency of root canals on the same tooth, denture repairs and other appliances
that seem to wear out annually, along with the regular, costly and constant
adjustment of other appliances can be enough, in and of themselves, to improve
the viability of your dental plan. By working with your plan's data, increasing
your knowledge of what a dental plan should do, what your plan is actually doing
and where it is being asked to do more than you can afford, you'll be halfway
towards creating change.
By understanding changes in the dental profession, such
as those in the ODA fee calculation method, and interactively managing any
changes that you deem to be unsatisfactory, you will be taking an important step
in improving your plan design. BC
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Team work is key
Working with carriers and brokers is the key to plan
sponsor savings.
Plan sponsors often do little more than complain about
the increasing costs of their employee dental plan. Instead of blaming brokers,
insurance carriers, employees and the providers of these services, sponsors can
achieve much more by getting involved in the process and management of the plan.
For example, last year's dental fees in guides, such as
the ODA Fee Guide, were determined on the basis of two factors: time and
responsibility of each procedure. The new method--to be brought in over the next
three to five years beginning in 2002--introduces factors such as "elasticity"
and "cost of practice" into the equation, in order to help maximize dentists'
incomes.
By working with your broker and carrier, you can mine
current financial data, audit claims for patterns of abuse and over- utilization
and review the formulary of allowed procedures. These measures can prevent
unwarranted maximum charges in minimal situations, close holes in old contracts
that allow services to be paid for even though they are related to non-covered
procedures and reduce the frequency of routine examinations. Through interaction
and co-operation, you can achieve unexpected financial results. |
Dr. Gerald
Leavens is a dentist who works as a dental consultant with the
insurance industry. gleavens@sympatico.ca.
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