Research suggests that people remain uncertain about the cost of undergoing dental treatment, both privately and in the NHS, with some deterred from visiting by fears about prices. Madeleine Davies asks how dental benefits can help people to fund their care.
Last year mystery shoppers from consumer champion Which? called 423 private dental practices to check their prices. What they discovered is “wild” variation. Prices ranged from £45 to £124 for an initial check-up and from £250 to £518 for a crown.
In the wake of the investigation, the Office of Fair Trading (OFT) has announced a market study to examine whether the dentistry markets (both private and NHS) are working well for patients. It will look at how dentistry services are sold, whether patients have enough information to make an informed choice about where to undergo treatment and how easy it is to change dentists or to make a complaint.
“Patients appear to be confused about the prices they are being charged and concerns have been raised that they may not be getting sufficient information or adequate choice over the dental treatments they receive,” says OFT director Sonya Branch. “We also note that the costs of private dental treatment in England are among the highest in Europe. Given the current strains on people’s finances, we think it is a good time to examine whether competition is working effectively to drive up the quality of private and NHS dental services and deliver better value for money for consumers.”
Brokers and dental benefit providers agree that confusion surrounds the cost of dental treatment.
“As more people are having to consider going private or their practice is going private they are in need of more clarity to be able to make an informed decision,” says Matthew Judge, technical director at national intermediary Jelf Employee Benefits. “The major problem is where to access information regarding fee schedules.”
“Corporate employers are not as informed as buyers as they could be,” says Joanne Anderson, senior consultant at Towers Watson, another intermediary. “There is a lack of reliable resources easily available about quality and cost.”
Mike Blake, compliance director at national specialist intermediary PMI Health Group, agrees that it is difficult to know whether a dentist’s pricing reflects good value while Richard Chandler, senior employee benefits consultant at Lorica Employee Benefits, would like to see “jargon-free, clear price and options lists.” When Which? mystery shoppers were sent to surgeries across England, only seven out of 40 had their prices displayed.
Even within the NHS, where treatments are categorised into three pricing bands, there can be confusion, according to Tracey Williams, client analyst at specialist intermediary Enrich, who points out that, pre-banding, consumers were accustomed to specific prices for specific treatments.
“This confusion has been further exacerbated by the continued shift to more private dental practices and the differentiation in costs compared to NHS treatment,” she reports. “Many dentists who offer NHS dental care will also provide private treatment and this then ‘muddies the waters’ even more as to how much treatment should cost.”
“Some people, when having NHS treatment, are not being told by the dentist that some of the treatment they are having is private treatment,” adds Kirsty Jagielko, head of product management at benefit provider CIGNA HealthCare. “A lot of people are used to going for a scale and polish and check-up so they are not used to an unexpected bill.”
Researching the market
Variations in pricing create challenges for both insurers and employers seeking to ensure that benefit levels remain competitive. Intermediaries report that they rely on insurers to a large extent to monitor pricing levels in the private sector.
CIGNA uses its own claims data in order to assess pricing trends, gathering lots of information about the bills charged by dentists.
“There is nowhere to go as a consumer so it is difficult to get a sense of what is typical,” says Jagielko. “We spend a lot of time analysing our data and we also review our satisfaction survey to see where people are most concerned.”
CIGNA reviews benefit levels annually and adjusts reimbursement levels for specific treatments, rather than across the board. Although the OFT reports that the costs of private dental treatment in England are among the highest in Europe, Jagielko does not believe rate rises are “unreasonable” but does note that there is variation across practices.
“There are some established well-known clinics developing a name for themselves that can use that as a bit of leverage,” she reports. “Prices are higher in London, lower in major towns and lowest in provincial areas.”
Simplyhealth, another provider, conducts “extensive” research every two years, involving both consumers and dentists, in order to review benefit levels.
“When setting benefit levels we look at a wide number of factors including NHS and private pricing past and present, new treatments available and our own claims data to determine the types of claims made and the average cost,” says Bernie Hurn, research and development manager. “We also look at how best to segregate benefits and also market and competitor changes and reviews.”
Simplyhealth’s 2011 annual dental survey found that 40% of 10,000 consumers said they were deterred from going to the dentist by the cost.
However, intermediaries do not, by and large, believe that dental benefits should cover the cost of care completely.
PMI Health Group’s Blake argues that, with most schemes arranged on a voluntary basis, it is the employee’s responsibility to choose between lower premiums or more extensive coverage.
“I suspect there is a little bit more self choice involved with dental than most health insurances,” he says.
Enrich’s Williams agrees.
“From experience of our own clients and their employees, it is not widely expected that dental treatment will be covered in full and most dental benefit schemes will be implemented on the basis of a standard level of cover being available for employees depending on the location of the employer,” she says. “Therefore, an employer in London is more likely to opt for a higher level of cover in order to ensure an adequate level of benefit is in place. Many consumers are more concerned with having annual check-ups and hygiene visits covered rather than full restorative and major treatment covered.”
CIGNA’s Jagielko says that the role of the insurer is to understand user needs, and how they vary.
“People need to weigh up what it is they need most from their benefit,” she says. “Do they want cover for regular treatment or something that is there for catastrophic things?”
Jelf’s Judge believes that insurers must also provide more clarity about benefit levels.
“Dental benefit providers will often provide a total benefit of cover and then provide a schedule of benefits for various procedures but unless you are certain about what treatment you need it would not be really clear if your cover was sufficient,” he says.
He also believes that insurers could be clearer about the potential for shortfalls although he reports that Jelf takes a “realistic view” on the need to practice cost containment to ensure that the benefit, widely claimed on, remains affordable.
Meanwhile, Enrich’s Williams believes that there may be “too much” information about pricing available, resulting in consumer confusion.
“Some insurers have their own pricing maxima for each individual treatment process provided by a dentist whether NHS or private and this does not necessarily tie in with the actual charges made by dentists,” she says. “Although NHS-banded charges are the same across all NHS dentists, private dental practices do not have a general scale of charges for treatment so costs for a specific treatment may differ depending on the dentist chosen.”
Towers Watson’s Anderson, points out that dental benefits will often be part of a broader benefits package, providing intermediaries with the opportunity to practise holistic consultancy.
“You can’t look at this in isolation and the level of reimbursement can vary really greatly from plans doing 100% of NHS to private treatment plans giving specific maximum reimbursement levels and you can get bespoke designs as well,” she says. “There is a myriad of things you see in the market.”
Intermediaries can also draw on their relationships with insurers to secure packages for clients. Lorica’s Chandler negotiates with insurers “to ensure our clients receive the most competitive rates and levels of cover”.
Intermediaries agree that dental benefits remain highly popular.
“The use of dental insurance in a company that provides the benefit is high, indicating that employees like and take advantage of this benefit,” says Lorica’s Chandler. “This is especially true for routine treatment that might otherwise be abandoned.
He believes that the benefit is also important to employers.
“With employee wellbeing being more and more important to employers, dental insurance benefits can provide employers with a way to look after their employees’ wellbeing and by helping to maintain an individual’s oral health, the risk of heart disease and strokes can be reduced,” he explains.
Demand for private dentistry is largely driven by the availability, or lack thereof, of NHS dentistry, he says. He believes that pressures on NHS funding, the new contract for dentists and a shift to major restorative treatments being provided privately rather than on the NHS, will determine coverage in future.
Enrich’s Williams agrees that, due to the limitation of NHS dentists, “certain areas of the country are finding a more significant move to dental insurance as consumers have to prepare to pay the cost of private treatment”.
However, she reports that capitation plans are becoming “increasingly expensive”, driving the popularity of corporate sponsored schemes, “not only as a sustainable benefit to the individual, but also in an effort to ensure employees are not spending significant amounts of time away from their jobs at the dentist near their home address.”
In London, Enrich is seeing a shift towards alternatives to fully insured schemes and “a lot of interest” in the Barbican or Practice Plan scheme, where a specific dental practice is used by all members of the scheme and specific treatments are available for a fixed cost per member.
“These types of scheme are also extremely beneficial to the employer as the individual does not need to take a half day off work to attend their local dentist; the surgery is close to the business address,” explains Williams.
She has also noticed an “increasing trend” towards cosmetic treatments such as teeth whitening and veneers which are not be covered under dental insurance but can be paid for under the dental element of a cash plan policy. In fact, cash plans, which include dental cover, are becoming a popular add-on for members who already have PMI cover, according to Williams.
Overall, the future looks bright for private dentistry. The UK market for dental services was worth £7.2bn in 2010 and forecasts suggest this could grow to £8.2bn by 2014 with much of the growth coming from the private market. The 2011 MetLife study of employee benefit trends found that one-quarter (24%) of employees ranked dental as one of their top three most important employee benefits. Almost half (49%) ranked it in their top five. Regardless of the outcome of the OFT review, employees should continue to value a benefit that takes the financial pain out of a visit to the dentist.