medical insurance vs. dental “insurance”

“Dental insurance” isn’t even close to being actual insurance. Real insurance is about investing a small amount to help manage the risk of rare but potentially catastrophic events. From Wikipedia:

Insurance is the equitable transfer of the risk of a loss, from one entity to another in exchange for payment. It is a form of risk management primarily used to hedge against the risk of a contingent, uncertain loss.

You buy car insurance in case of a car accident or theft. These are relatively rare events, but they’re also undesirable events. You’re glad  you have insurance when you have a car accident, but rational people are more interested in avoiding them.

Even “health insurance” (which is probably better termed medical insurance) is mostly like real insurance. You (or your employer, or the taxpayers) pay a premium so that catastrophic and expensive medical treatment is available to you if you need it. Imagine someone having some kind of cancer and their medical insurance carrier explaining to them: “I’m sorry, but you’ve spent all of your insurance dollars this year on that broken wrist back in February so I’m afraid you’re going to have to wait until January for your chemotherapy unless you just want to pay out of pocket.” The ramifications of the ACA (a whole other topic) notwithstanding, the idea of health, or medical, insurance mostly lines up with what real insurance is about.

Dental “insurance” is a contract, usually between your employer and a 3rd party payor. If a patient breaks a tooth or needs a root canal their benefit should pay a certain amount each year for certain procedures specified by the contract. The insurance company isn’t interested in your dental health. They are interested in paying out as little as they can while still staying within the specified conditions of the contract. In almost all cases there is a maximum dollar amount that the insurance company will pay and no more. What you’re getting here is a crappy gift card that pays toward some dental treatment. This has been covered by myself and others ad nauseum and isn’t really the point of this rant.

Something that’s really important to realize is that the patient’s dental health and potential need of dental services is completely independent of what dental benefits they have. You can have a low caries nonsmoker with a premium dental benefit that only uses a small amount of the dental benefit for prevention or a chain smoking, pop drinking dude with ectodermal dysplasia and “Healthy Kids Dental.” The two things have no bearing on each other.

So, is it reasonable to ask the question: “what’s the right amount to spend on dentistry in a given year?” Not really. This is obviously going to depend a lot on the patient’s individual risk factors and habits. However, I promise you that insurance companies have given a lot of thought to that question. I would suggest that the dollar amount of a patient’s dental benefit has a huge bearing on what they perceive as being the right amount of treatment necessary.

For many, perhaps most of our patients, the right amount of treatment in a given year is how much their insurance will cover and no more. I think this comes from the experience we have as patients with medical insurance. When you go to the doctor’s office or hospital for something, there is an expectation that your insurance will cover any services there. It’s rare that there is a conversation about costs incurred by whatever services the patient receives. Whether it’s a $200 office visit or a $50,000 knee replacement, it’s a reasonable patient expectation that their medical insurance is going to cover it once their deductible (if they have one) has been met.

This is not so with dental benefits. If a patient needs a certain amount of dental treatment and it costs significantly more than any given year’s benefits, they’re less likely to pursue any treatment at all. I promise you that insurance companies are banking on this reaction.

I think this is where patient expectations get mixed up. Medical insurance covers what you need, no matter what the need is. If they apply this logic to their dental benefit, then whatever their dental benefit amount is must be the right amount to spend on dental care! So clearly if a dentist diagnoses a patient’s dental needs and it’s more than their insurance will cover, a patient might become suspicious of the diagnosis.

This is a complicated problem. To pretend that patients simply don’t value dental treatment enough is short sighted. It’s probably accurate for some people, but for others they just can’t or won’t spend any more than they need to on dental care. People react to incentives and if a patient has dental benefits, they’re going to want to use them. After all, they paid for them…either directly or indirectly. They shouldn’t be made to feel ignorant for wanting to use the benefits that they have. But I think it helps to illustrate the differences between medical insurance and dental benefits and how that plays into a patient’s expectations of how much treatment should cost.