By Joe Touschner
As families have signed up for new marketplace coverage over the past several months, many questions have come up around dental benefits. I wanted to pass along some useful resources for understanding 2014 plans as well as the latest news on how marketplace dental plans will change for 2015.
First, just in time for the last few weeks in this year’s open enrollment period, the Children’s Dental Health Project has released two new resources to help sort out the dental plan choices available through marketplaces. One is geared toward families and another is useful for those of us working to understand the dental benefits picture across states. CDHP and Families USA collaborated on a consumer guide to Buying Children’s Dental Coverage through the Marketplace. With clear, understandable language, it walks consumers through the choices and considerations they should keep in mind when purchasing dental coverage for kids.
One consideration is whether dental benefits are offered as part of a health plan or separately as a stand alone dental plan (SADP). Each choice might have some benefits for certain consumers. Embedded dental benefits make it easier to apply premium tax credits, federal cost-sharing reductions are available, and families with high needs might benefit from a consolidated out-of-pocket maximum. A separate plan will mean an additional premium, but might come with more favorable cost-sharing for some families. In general, we feel that families should have a choice between the two. But how often do they have that choice and do families have the information they need to choose wisely? CDHP has helpfully analyzed how many health plans embed children’s dental benefits in each of the federally facilitated marketplace states. Nationwide, about a third of plans embed children’s dental benefits, but the analysis shows there’s a lot of variation. In some states all plans embed, in others, none. And as CDHP points out, greater transparency in terms of benefits and costs is needed to help families evaluate their options.
Finally, some changes are on the horizon for next year. HHS published final rules that will alter SADPs’ out-of-pocket maximums. This year, those maximums were required to be reasonable, a standard that was interpreted by each marketplace. The federal marketplace interpreted ‘reasonable’ to mean no more than $700 for one child and $1400 for multiple children. Next year, though, all marketplaces—state and federal—will be required to apply an out-of-pocket maximum for SADPs of no more than $350 for one child and $700 for multiple children. Depending on how dental plans respond, lower out-of-pocket maximums could mean slightly higher premiums. But the lower limits will also offer significantly more protection to families with above average dental needs. One thing HHS did not change for 2015 is the actuarial value standard that dental plans must meet. While an initial proposal would have eliminated them, HHS responded to a request from CCF, CDHP, and other consumer groups to keep the AV standards in place.