Dental Insurance in the USA: How It Works and Why You Could Be Hit with Huge Bills Even If You Have a Policy

Regular health insurance does not include dental services, so many people purchase dental insurance separately. But this is not always a good idea. The fact is that dental insurance is not really insurance, but rather a semi-useful discount plan for a certain amount. And once you reach the maximum of this amount, you find yourself on your own, often with debts of hundreds or thousands of dollars. Why does it work this way and why complicate your life so much, the publication said Vox.

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Dentistry is not healthcare

In the healthcare industry, dentistry is something of a stepchild. The American medical system does not consider dental care an essential service, despite overwhelming evidence linking oral health to the well-being of the rest of the body, from better pregnancy outcomes to a healthy heart. But dentistry has always been isolated.

Dental insurance, too, was isolated in its own little, largely unregulated corner. According to the American Dental Association (ADA), a third of adults ages 19 to 64 have no benefits at all. By comparison, just 8,4% of Americans do not have health insurance. Many patients put off visiting the dentist, citing the cost of services as the main reason for refusing, including those who are insured.

Even if you have dental benefits, they are often not very beneficial. Insurers may cover 100% of the cost of a cleaning or examination, but as soon as other, more complex services are involved, they begin to cover less and the patient has to pay some or most of the costs. The maximum annual rate is, for example, $1 to $000, after which insurance will not cover anything.

“If you look at the dental insurance model, it does not protect the patient from financial risk. Quite the contrary, noted Marko Vujicic, chief economist and vice president of the American Dental Association's Health Policy Institute. “As soon as the benefit, $1400 or whatever, ends, all this financial burden will fall on the patient. So it protects the insurer.”

For example, your insurer was told that it would only pay 50% of your heart bypass surgery and that it would only cover $10 of your medical benefits per year. Nowadays this would be considered unacceptable. But that's exactly what will happen, Vujicic says, if I need a crown—my insurance will cover half, but will only pay out $1500 in total for the year. Last year my dentist messed up a filling. In less than a few minutes I had reached my limit.”

None of this means you should ditch your dental insurance and go it alone. Insurers can often offer patients better prices for services than they could get on their own, and $1500 in dental cost assistance is no small feat.

The mouth is not a part of the body

Your mouth is certainly a part of your body, but in America it is treated differently.

If we step back a little, dentistry has been done by barber surgeons for centuries, which goes something like this: the guy who cut your hair pulled out your rotten tooth (and did a lot of procedures that you'd probably rather your barber no longer did). Dentistry was not recognized during the establishment of medical schools in the United States in the 1700s and 1800s. Eventually, the nation's first dental school was founded in 1840.

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“Since the beginning of the modern era, there has been debate about dentistry's place in the overall health care system, but the bottom line is clear: dental education, regulation, and practice are isolated from the rest of health care,” writes Elizabeth Mertz, associate director of research at the Healthforce Center at the University of California, San Francisco. -Francisco, in his 2016 article addressing the gap between dentistry and medicine.

In the 1960s and 1970s, she notes, consumers largely paid their own dental expenses, while the majority of the population had some kind of hospital or surgical insurance for medical care. A prepaid dental plan should encourage dental visits because it will at least cover some of the costs. However, this business model only made sense for insurers after they realized that not everyone would take advantage of the benefit—people and employers would pay for insurance, but not necessarily enroll.

That's why we have a system in America today where we put dental care into its own little kingdom. We do the same thing with dental insurance, treating it as if it serves a different purpose.

“Health insurance is designed to help you most when you're sick,” explained Michael Adelberg, executive director of the National Association of Dental Plans, a trade group representing dental insurers. “Dental insurance is more focused on prevention and helping people, many of whom are not naturally inclined to visit the dentist.”

Although, again, having dental insurance is not always the same as visiting the dentist every two years.

Insurance programs

The Medicaid and Medicare programs, developed in the 1960s, both excluded dental services from coverage and continue to do so.

Dental services are not included in regular Medicare unless they are considered part of another medical procedure (such as a heart or organ transplant). Although 90% of Medicare Advantage plans offer some type of dental coverage, the quality of that coverage can vary widely. Patients are often unaware of the limitations of these supplemental plans when they sign up for them, so they think they are signing up for comprehensive care but end up only being offered teeth cleanings.

“You have to read the fine print of the plan,” said Michele Rosenberg, director of the health affairs group at the Government Accountability Office.

States are required to cover dental care for all children enrolled in Medicaid. Most states offer adults at least emergency dental care, but many offer nothing beyond that. The Affordable Care Act made children's dental care a basic health benefit (though it's a little more complicated, depending on the state), but didn't do much for adults. Untreated dental problems can lead to dire negative consequences, including gum disease and undiagnosed oral cancer.

Because dentistry is not an essential service, it is not subject to a number of patient protection rules, Vujicic explained.

“Under the Affordable Care Act, we protected consumers from the costs of health care. We have said that you cannot be denied service due to pre-existing conditions. There is a limit on how much a family will pay out of pocket each year for health care, no matter how sick you are, he explained. — None of this applies to dentistry, since it is not regulated as an essential service. So we are a little behind when it comes to what types of insurance are available.”

There are no heroes or clear villains

Study after study shows that Americans, both with and without insurance, avoid going to the dentist and getting dental treatment because it is so expensive. The solution could be even more costly—hundreds of thousands of people end up in the emergency room each year for often preventable dental conditions, costing one estimate as much as $2 billion.

There is ample evidence that a shift away from the status quo in dentistry and dental benefits will be positive for patients. One study found that low-income people who gained access to dental insurance through Medicaid actually visited the dentist more often. Another study found that including dental coverage in health plans (in this particular case for children) reduced costs for beneficiaries.

What is stopping change? There is little political energy devoted to addressing the dental benefits issue, and when there is, it generates resistance from those who prefer the status quo.

“Dentistry itself is engaged in a vigorous and costly campaign to maintain the status quo,” said Lisa Simon, a dentist and physician at Brigham and Women's Hospital and Harvard Medical School. “There have been many opportunities recently to integrate dental insurance into the Medicare and Medicaid programs in a variety of ways, and many dentists have strongly opposed it.”

Many dentists still practice privately, with their own offices, and typically accept government insurance at low rates, if at all, Simon said.

“They tend to react very strongly to any attempt to update the insurance industry,” she explained.

Weak regulation

In 2021, the ADA fought against Democrats' proposal to provide dental coverage to all Medicare recipients as part of President Joe Biden's Build Back Better program, arguing that the focus should be on low-income seniors rather than on everyone.

“As an association, we are not against this. The question is how it will be organized,” said Mark Vitale, a New Jersey dentist and former chairman of the American Dental Association’s government affairs council.

Introducing dental benefits to everyone over 65 could be “prohibitively expensive” for the federal government, he said. He noted that there are structural differences between Medicare and dentistry: “We use different codes, different qualifiers, different types of fee schedules.”

“The ADA is a trade group that advocates for the interests of its members, private practice dentists who have done very well under the current system and believe that Medicare may increase their administrative burden or provide lower reimbursement that they are not interested in,” Simon explained. .

The White House ultimately abandoned the plan as part of a broader decision to scale back the package.

The dental insurance industry is lightly regulated and, in many ways, would like to keep it that way. One recent battle has been over medical loss ratios (MLRs), which determine how much of the revenue insurers receive from premiums goes toward satisfying medical claims and improving quality of care versus, for example, administrative costs. The ACA requires health insurers to maintain an MLR of 80/20, but does not affect dentistry.

In 2022, Massachusetts voters passed an initiative that would require dental insurers to devote at least 83% of premiums to treatment and improving patient care. Dentists are interested in the MLR rules. Dental insurers and the organization that represents them, NADP, not so much. They argue that in low-premium products such as dental insurance, a larger percentage of operating expenses are naturally fixed costs.

“My industry believes that applying medical loss ratios to any low-premium product without considering the fundamental economic differences between medical and dental insurance is simply foolish,” Adelberg said. “The overall theme here is that all stakeholders would like to get more money into their pockets.”

Some dentists point out that insurance maximums have not increased in recent decades, even as dental prices have risen.

“Forty years ago, you could get a lot of dental care for $1500,” Vitale pointed out. — Today $1500 doesn’t allow you to do that much. My question to the insurance companies: why haven’t you increased the amount of insurance compensation?”

Difficult task

The upshot of all this is that visiting a dentist (and paying for their services) can be a truly daunting task.

When people choose dental insurance plans, they need to understand that it is not insurance. Richard Manski, chair of public health at the University of Maryland School of Dentistry, says it's more like Amazon Prime: you give the company money, and in return it goes out into the market, finds sellers (in this case, service providers) and tries to offer you better deals than what you could get yourself.

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“When you buy dental insurance, and you buy insurance where the dentist is in network, that means the dentist has agreed to the set prices for all of those procedures,” he explained. “This way, even if the insurance company doesn’t pay a penny, you are already getting a truly valuable service in return, which means you don’t have to negotiate with the dentist.”

Indeed, if you have a painful tooth infection or something like that, you're probably in no position to discuss discounts with your doctor.

There are ways to strategize about your dental care and insurance. If a patient has exceeded their annual maximum, they may consider rescheduling some procedures until the following year.

People may try to determine in advance whether dental insurance is worth getting at all. Let's say a person has never had tooth decay, they simply go twice a year for a cleaning and examination - the cost of this may be less than the insurance premium. Or maybe the insurance offered doesn’t pay much at all for more complex problems.

“What I'm saying is that you don't need insurance to go to the dentist,” Vitale emphasized. “Today, dental offices have loyalty plans and offer various financing options.”

He noted that people can try to negotiate discounts with their dentists, but as said, it all depends on your skills.

A scenario in which patients must try to predict what care they will need and hope it won't be too expensive is far from ideal. It's unrealistic to expect people to figure out their own health care costs, Simon said, "because it requires a level of sophistication in understanding health care pricing and access to health care and all these other things that makes it extremely unfair."

“If someone’s English is not their first language, or they work multiple jobs, or the bus ride to the dentist is very long, then understanding the basics of insurance and whether it’s worth the financial burden is even more difficult. That’s why the way our dental “insurance” system works is so bad—it’s truly unfair for most people,” Simon said. “For anyone, but it works worst for those who need help the most.”

It is worth noting that, among other things, it can be difficult for patients to determine which procedures they really need from a dentist - some offices recommend basic procedures, while others may get the impression that they offer to do everything. Patients need to be much more involved in decisions about their own care.

Of course, all this is easier said than done. Most people don't have the time or energy to deal with their dental care or dental insurance, and they don't need to. From a patient's perspective, it's easy to look at this and wonder if there is a better path to oral health in America than the one we currently have. The fact is that this will require legislative acts and other regulatory frameworks.

This could mean Congress taking action to expand dental coverage under Medicare and Medicaid. The dental community will likely resist this, although Manski said he believes there is some sort of deal that both sides can probably "get over."

One could also imagine requirements that, for example, eliminate maximums on dental insurance and protect consumers from high costs. Perhaps one day dentistry will become part of regular health insurance - once the country stops treating teeth as a separate bodily unit.

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