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Dental benefits buck health care trend
The average annual increase in the cost of dental premiums has subsided since 2001, as premium increases for medical benefits remain well above 2001 levels.
Dental never saw the double-digit volatility that keeps medical costs in the news. But while medical increases remain at rates high above the original 2001spike, dental has cut across the trend and climbed down over the same period, according to new industry analysis(1).
Employers, who cite pricing stability as among the most attractive attributes of dental benefits, might find it easier to continue spending on the popular benefit, which has long been ranked by employees as their second favorite next to medical.
If you can decrease pricing pressure in the benefits package when soaring medical costs are squeezing other benefits, its bound to be welcome news, said Tom Dolatowski, vice president of marketing for Delta Dental Plans Association.
A recent market report from Mercer Oliver Wyman Acturial Consulting indicates that the average dental benefits cost will increase by about 6.8 percent in 2004, compared with an increase of 7.6 percent in 2001. Annual increases in fee-for-service dental plans and preferred-provider organizations (PPOs) have been declining since 2001. Most people with dental benefits are covered by one of these two plan designs. But costs in dental health maintenance organizations (DHMOs), which provide the highest degree of managed care among dental plans, have risen slightly since 2002, according to the report.
A different report, from the National Association of Dental Plans2, gives more detail on what benefits sponsors and subscribers can expect. For example, fee-for-service family coverage from a medium-size employer will cost about $5.75 more per month, compared with last year.
Dental pricing remains stable because the benefit is designed to drive preventive care. When you prevent or minimize disease, you minimize the need for expensive remedial or restorative treatments, Dolatowski said.
Delta Dental Plans Association, based in Oak Brook, Ill., is a national network of not-for-profit dental service corporations specializing in providing dental benefits programs to 45 million Americans in more than 75,000 employee groups throughout the country.
For more information, contact Susan Morris, Delta Dental Plans Association, 630-574-6855 or firstname.lastname@example.org; or Tina Valek, Group Leaf, LLC 651-324-2710 or e-mail to: email@example.com
1. Carrier Trend Report 2004.1 Analysis, by Mercer Oliver Wyman Actuarial Consulting, Inc.
2. 2003 Dental Benefits Report, by the National Association of Dental Plans.