Dental, vision plans shifting to what employees wantReprints
Providers of voluntary dental and vision plans are sweetening benefits, squeezing costs and stepping up decision support and member communications — all in an effort to woo employees.
Employers, of course, must make these plans available before employees can decide whether to buy coverage through the workplace.
Still, insurers and vendors recognize that workers, increasingly, are the ones picking up the tab — or at least a big chunk of it — for dental and vision plans, which account for the bulk of these voluntary benefits.
A 2014 Kaiser Family Foundation/Health Research & Educational Trust employer health benefits survey indicates that 53% of employers offer or contribute to a separate dental plan, and 35% offer a separate vision plan. Among large firms, those with 200 or more workers, 88% and 63%, respectively, offer or contribute to separate dental and vision plans. The survey does not indicate what percent of these plans are paid entirely by employees.
However, the 2015 National Survey of Employer-Sponsored Health Plans by Mercer L.L.C. found that about 24% of large employers require employees to pay the full cost of dental coverage, up from 22% the prior year. Voluntary dental plans are most common in the South, where 40% of employers require employees to pick up the whole tab, according to the survey.
“Traditionally, you looked at plan design through the eyes of the employer because they (employers) were paying for it,” said Dr. David Guarrera, national clinical director and vice president of MetLife Inc.'s dental and vision product unit.
Now consumers are paying for it, he said, and they want “different things,” such as dental implants, which traditionally were not covered, and white fillings instead of silver.
Employees also desire higher benefit levels. Annual maximums, or the amount insurers will cover in a year, once topped out around $1,000, Dr. Guarrera said. “Now you're seeing $1,750 or $2,000 or even up to $3,000,” he said.
Colin Bradley, vice president of business development at Manasquan, New Jersey-based Winston Benefits Inc., said dental and vision plans are negotiating good deals and discounts with their providers to make benefit dollars go farther.
“We're seeing the carriers come to the market with stronger products, adding more features, covering more benefit,” he said.
Mr. Bradley recently negotiated a vision plan renewal on behalf of a large New York hospital system that included higher allowances for frames and contact lenses and fully covered standard anti-reflective coatings. Other eyewear industry innovations focus on new technologies, such as retinal scans offered as part of preventive exams, added Dona Senkewicz, underwriting and benefits analyst at Winston Benefits.
And vision plans are offering consumers more choices.
Guardian Life Insurance Co. of America, for example, offers a choice of two networks. A lower-cost plan utilizes chain vision stores, and a higher-end alternative focuses on private-practice eye doctors, said Stuart Shaw, vice president and chief actuary for group insurance in Guardian's Bethlehem, Pennsylvania, office.
In the dental space, Mr. Shaw sees tiered network plans popping up. These plans offer two in-network options, but one includes preferred dentists with whom the insurer has secured better financial terms. Employees who select a dentist from the preferred tier typically share in the savings through lower out-of-pocket expenses or reduced cost-sharing, he said.
Mr. Shaw noted that Guardian is rolling out tiered group dental coverage this year.
Tiered and narrow dental networks mimic a cost-containment strategy widely used by medical plans offered on federal and state exchanges under the Patient Protection and Affordable Care Act.
But Dr. Steven Loomis, a Denver-area optometrist and president of the American Optometric Association, worries about financial arrangements that coax people to use one network or tier of providers over another.
“Who you've been incented to see really is entirely independent of the quality of care or the quality of the patient experience,” he said.
Dental and vision plans are among the most popular voluntary benefits that employers offer. In fact, most people covered by dental or vision plans in the U.S. get that coverage through an employer, MetLife's Dr. Guarrera said. But workers often don't understand or take full advantage of those plans.
In 2014, Rancho Cordova, California-based VSP Global and its VSP Vision Care unit released results of a study showing that employers saved $5.8 billion over four years in reduced health costs, productivity losses and turnover when they offer a stand-alone vision plan.
The study suggests that employees who have annual eye exams, which can detect other health problems such as diabetes, are more likely to receive early treatment, reducing the long-term cost of care.
Likewise, multiple studies link poor oral health to chronic conditions including diabetes and heart disease.
Employers “more and more” are leaning on their vendors and benefits administrators to improve post-open enrollment communications, Mr. Bradley said. And new digital tools make it easier to reach employees after open enrollment, he said.
EyeMed Vision Care, a unit of global eyewear manufacturer Luxottica Group S.p.A., offers a mobile app that Lukas Ruecker, president of the Mason, Ohio-based vision care company, likens to OpenTable.com. Employees can tap a button to see what their benefits cover. The app can search nearby providers and employees can schedule an appointment online.
“Consumers want to make an informed choice about what they're getting, even in something as simple as vision,” Mr. Ruecker said.