What does your dental insurance premium pay for?

Massachusetts voters face four statewide questions on the November ballot: Question 1 deals with taxing high-income earners, Question 2 with dental insurance, Question 3 with liquor licensing laws and Question 4 with who is allowed to apply for a Massachusetts driver's license.

The first three questions are listed, and explained, in the red "Information for Voters" booklet mailed out this week by Secretary of State William Galvin's office. Question 4 was a late starter; signatures to have the initiative placed on the ballot were not submitted to Galvin's office before the booklets went to press.

Also not in the booklet are local questions. Those are printed just on local ballots. There are a few: Belmont has two, Brookline, Hingham, Wrentham, Natick, Worcester, Westborough and Burlington also have local questions, according to Galvin's office. Some deal with fire stations (Brookline) a library and public skating rink (Belmont).

Binding questions come first on local ballots, non-binding public policy question are at the bottom of the ballots.

How much of dental insurance premium should pay for dental care?

In terms of statewide issues: Question 2 refers to the dental insurance industry and asks voters to decide whether insurance companies should be obliged to spend 83% of premium dollars on patient care.

In taking a closer look at Question 2, voters may wonder if it really matters how much of their dental insurance premiums end up in their mouths. Massachusetts already requires health insurance companies allocate 88% of premium dollars to patient care, called a medical loss ratio. Any overage is routinely refunded. This initiative would extend the same criteria to dental insurance companies.

The measure is supported by the Massachusetts Dental Society (MDS) and the American Dental Association (ADA). Patients, they claim, deserve to know how much of their premium is used for their actual care as opposed to much is allocated to administrative costs and how much is profit.

"We encourage voters across Massachusetts to vote YES on Question 2 to improve access to quality dental care and better dental benefits," said Dr. Andrew Tonelli, committee spokesperson and co-chair of the MDS' Government Affairs Committee and former chair of the Boston District Dental Society. "This ballot initiative would make dental insurers more transparent and accountable to the patients they serve."

It would guarantee patient premium dollars are spent on patient care, Tonelli said.

A study commissioned by National Association of Dental Plans looked at the costs and benefits of the proposal. It found most of Massachusetts dental insurers allocate between 60% and 79% of premiums to patient care; depending on the size of the company, with smaller companies allocating fewer dollars while larger companies allocate more. The remainder of premiums charged is used, in part, for administrative costs.

The study by the Milliman Research group found the proposal would impact companies with a smaller pool of clients as the administrative costs of insuring patients is shouldered by fewer clients. Also, the cost of fulfilling the 83% mandate, coupled with the cost of rebates, would impact company revenue.

In the "Information for Voters" booklet, an example to illustrate the need for this reform quotes a 2019 form prepared by Delta Dental (Form 990) that lists executive bonuses, commissions and payments to affiliates at $382 million and patient care costs of $177 million.

"We see approval of the ballot measure as a watershed moment in how dental insurance is provided for patients," said Cesar R. Sabates, D.D.S., president of the American Dental Association. "Dental plans should serve patients first and foremost, and the companies that offer them should welcome transparency and accountability, rather than hide from it."

State approval for premium increases

If passed, the measure would also require any increases in dental insurance premium costs to be approved by the state Division of Insurance, just as it does for medical insurance premiums.

At a recent meeting, the state's Health Connector Board approved a rate hike for medical insurance that averages out at 7.6% for insurance coverage purchased through the Health Connector. Some 85,474 unsubsidized customers or those who receive Advance Premium Tax Credits and purchase through the Health Connector would be affected by the rate increase.