Health Care Reform: How it will affect dental insurance in Washington
By: Dr. David Minahan, WSDA President-elect, and Bracken Killpack, WSDA Director of Government Affairs
WSDA has been closely tracking the implementation of health care reform in Washington state. Passage of the federal Affordable Care Act and the Washington state supplemental legislation will change the individual and small group insurance markets beginning in 2014. Earlier this year, the WDSA Board of Directors created the Task Force on Health Care Reform to monitor health care reform activities and make recommendations as appropriate.
Below are several important points that every dentist should be aware of before 2014. Additionally, the article on page 24 from the American Dental Association contains important information about the Affordable Care Act. While several state and federal decisions have been made, many additional rules on the implementation of health care reform have yet to be determined. This report will be one of several updates to WSDA members on what to expect in 2014 and beyond.
What are health benefit exchanges?
You may have heard a lot of talk about insurance exchanges. The Affordable Care Act requires each state to have an insurance marketplace (or exchange) for individuals and small businesses to purchase medical insurance. Exchanges are meant to accommodate the health insurance mandate that takes effect in 2014. Individuals and families that earn less than 400 percent of the federal poverty level will be eligible for subsidies. Individuals and small businesses are not required to purchase insurance through the exchange but individuals eligible for subsidies can only utilize these subsidies when purchasing insurance in the exchange. In Washington, the exchange is a public/private entity that will be branded the “Washington Healthplanfinder.”
Pediatric dental will become linked with medical insurance.
Beginning in 2014, all medical insurance plans offered in the individual and small group markets will have to include coverage for pediatric dental. This is because pediatric dental is one of the ten “essential health benefits” (EHBs) that must be included in all medical insurance. In Washington, pediatric dental is expected to include all children up to age 18 or 20.
Is adult dental included in health care reform?
No. Adult dental coverage is not an EHB and is therefore not mandatory. Additionally, individuals and small businesses will not be able to purchase adult dental coverage in the exchange in 2014.
Selection of the pediatric dental EHB coverage.
Federal rules gave each state the option to choose one of ten health insurance plans to serve as its Essential Health Benefit benchmark. Last year, the Washington State Legislature selected the Regence Innova plan (the small group plan with the most purchasers) as the EHB benchmark. The Regence Innova plan does not include coverage for pediatric dental. The Office of the Insurance Commissioner (OIC) was charged with defining all EHB coverage that is not contained in the Regence Innova plan. However, OIC was only given the option of selecting the state’s CHIP plan (dental Medicaid) or a Met Life plan available to federal employees. OIC has decided to select the state CHIP plan as the coverage that must be offered to satisfy the pediatric dental EHB requirement. Selecting the children’s Medicaid coverage does not mean insurance companies will use Medicaid reimbursement rates. It is only a selection of coverage. All pediatric dental insurance plans must cover what the CHIP program covers.
Pediatric dental benefits in medical insurance plans outside of the exchange.
Beginning in 2014, all medical insurance plans offered in the individual and small group markets will have to include coverage for pediatric dental. Outside of the exchange, pediatric dental will likely be embedded into medical insurance if the insurance carrier sells dental insurance and has an adequate network. Embedding means the cost of providing the pediatric dental benefit will be rolled into the overall cost of the medical insurance. Medical insurance carriers who do not offer dental insurance will have to subcontract with a dental insurance provider to provide the pediatric dental coverage. Since pediatric dental is an EHB, all insurance purchasers will have to buy the coverage regardless of whether or not they have children (more on this later).
Pediatric dental benefits inside of the exchange.
Pediatric dental benefits inside the exchange will operate a little differently. An additional requirement to “price” and “offer” pediatric dental benefits separately inside of the exchange was included in Washington state’s exchange legislation (HB 2319, 2012). This requirement prohibits medical insurance providers from embedding pediatric dental benefits into plans offered inside of the exchange. Instead, consumers will be given the option of purchasing a dental rider from their medical insurance provider (if available) or select a stand-alone dental plan offered by a dental insurance provider. Insurance purchasers with children will be able to select the dental rider of the medical insurance provider or a different stand-alone option. Purchasers without children will simply purchase the dental rider of the medical insurance provider (if a medical insurance company does not have their own dental network, they will have to designate another carrier to provide their dental rider).
Adults without children and pediatric dental coverage.
All medical insurance purchasers in the individual and small group markets must purchase pediatric dental coverage starting in 2014. This requirement includes all adults who do not have children. At this point in time it is unclear how much adults without children will have to pay for the pediatric dental benefit, but, the cost of purchasing this coverage should be much cheaper than those with children. This same principle is applied with other medical coverage. For instance, all medical insurance purchasers are required to purchase maternity coverage regardless of their sex or ability to have children. Additional federal rules on this topic are expected soon.
How does this impact dental insurance?
Beginning in 2014, more individuals will be making dental insurance purchasing decisions in conjunction with their medical insurance purchasing decisions. This means more children will likely have dental insurance with the same insurer that provides their medical insurance. As a result, a stand-alone dental plan such as Washington Dental Service could see its market share in the individual and small group markets may decrease as the market share of Regence and Premera dental plans increases.
As 2014 approaches, WSDA will provide more member updates on this important issue. Health care reform questions can be referred to Bracken Killpack at email@example.com or by calling WSDA at 800-448-3368. WSDA is also offering a free member webinar on health care reform on Tuesday, December 18 at noon. To register click here
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