Nebraska dentists tout bill as path to better patient care; insurers say it will be costly

LINCOLN — Nebraska dentists are backing a bill they said will help patients get more out of their dental insurance. Insurers, however, say the move could raise premiums and push some insurers out of the state.

Legislative Bill 639 from State Sen. Stan Clouse of Kearney would require dental insurers to disclose how they spend premium dollars and spend 85% of the premiums it receives on patient care. If the insurer doesn't reach that 85% threshold, it must return the difference to policyholders. The dental loss ratio mirrors the medical loss ratio codified in the Affordable Care Act.

About a dozen states have bills with similar legislation, and Massachusetts and Rhode Island have enacted dental loss ratios, according to the Nebraska Dental Association.

David J. O'Doherty, president of the association, said up to 40% of premiums in Nebraska go toward administrative costs, executive salaries or profits instead of patient care. He said less than 3% of patients reach the annual maximum of their plans.

"We want you to get what you paid for," O'Doherty said. Oral health issues are largely preventable, O'Doherty said, so a person visiting a dentist once or twice a year, as their plan allows, wards off problems that may cost more to treat.

Members of the association said dental care is the health care that people are most likely to skip.

"I routinely see patients delaying care, kind of waiting till the next year because they've just unfortunately run out of benefits," said Dr. Beth Kampschneider, a dentist in Bellevue.

"And if it's a situation where 60 cents (of each dollar) is being spent on their care, and 40 cents is being spent on something else, that increase of 25 cents is going to be huge for them," Kampschneider said. "I think patients really deserve to know where their premium dollars are going, and right now there's really no mechanism for us to understand exactly what they're paying for."

Clouse said his hope is for the bill to make dental care more affordable and accessible.

Sen. Mike Jacobson of North Platte chairs the Banking, Commerce and Insurance Committee and introduced similar legislation last year. He pulled it back because he learned the margins for dental insurers are smaller than medical insurers and because he worried about insurers leaving Nebraska. He said that could be a big problem in sparsely-populated areas of the state, which already have fewer care options.

In a hearing about the measure, Kate McCown, a vice president of insurer Ameritas Life, said dental premiums are about one-twentieth the cost of medical plans but have similar administrative obligations.

The National Association of Dental Plans said on its website a dental loss ratio may force insurers to raise premiums to cover those costs.

The association also asserts a loss ratio of 80%, the ratio under consideration in other states, is too high and arbitrarily based on the medical loss ratio. It said it is open to studying dental plan information to set a proper ratio in the future.

McCown said most states that have considered implementing a dental loss ratio backed off after studying the cost impact and learning that insurers may leave their states. Massachusetts adopted its loss ratio through a statewide ballot initiative. McCown said seven carriers, including her company, stopped operating in Massachusetts after the state implemented the ratio.

O'Doherty said 85% is a reasonable dental loss ratio. He shared data from a California study of the percentage of premiums that went to care from 2017 to 2021, and several providers reported exceeding 85%. Most were between 60% and 80%.

Dr. Liz Papineau, a dentist in York, pushed back on insurers who said the bill would force them to raise premiums. She said insurers put profits over care and should strive to be more financially efficient.