The high cost of dental treatment and a lack of NHS dentists are driving take-up of oral health benefits, but voluntary schemes may not succeed during the recession, says Tom Washington
Anyone who has visited the dentist and walked away with a huge bill will know just how costly poor oral health can be. This fact, coupled with a lack of National Health Service (NHS) dentists in the UK, has seen the dental benefits industry prosper as employers seek to include the perk in their health and wellbeing offering. Pam Whelan, corporate sales manager at Denplan, says: “Awareness of oral health [perks] is increasing as [staff] are experiencing how much dental treatment costs. Employers cannot ignore that and it is driving dental benefits’ popularity.”
The recession is tightening many employers’ and employees’ budgets, but so far it has not impacted on business within the industry, says Kirsty Jagielko, head of product management at Cigna. “We have seen a steady stream of corporate deals and in the last few months they are higher than they were last year,” she says. “I think what we are seeing is employers paying for dental benefits as a cheaper alternative to funding other company-paid health perks.”
Dental benefits are geared primarily towards reimbursing policyholders for the cost of maintaining good oral health, depending on their level of cover. This can include minor treatments, such as check-ups, hygienist visits and fillings, or major treatments, including crowns and bridges.
Employers can choose to cover the cost of the perk on their employees’ behalf, or simply offer staff access to a dental plan on a voluntary basis. Employers could also do so through a flexible benefits plan. The Employee Benefits/Towers Perrin Flexible benefits research 2009 showed 78% of employers that have a flex scheme offer dental insurance. “We have just been through April’s scheme renewals and certainly in flex plans, we have seen a trend of an increase in take-up,” says Whelan. “Whether that is being driven through the recession, I am not sure. It could be due to employees looking to offset potential costs in the future when money is tight, or maybe awareness and communication are getting better.”
But Jagielko thinks offering dental perks on a voluntary basis is unlikely to succeed during the downturn, because employees may ignore the benefit in favour of seeking treatment independently. “”It depends on the design of the package,”” she says. “If there is a cash alternative, employees might be more likely to take that at the moment and if the perk is funded through salary deduction, then they are less likely to sign up to the additional spend. But where people do have dental insurance, they do not want to give it up.”
The threat of employees turning their backs on dental health plans and seeking cheaper NHS treatment does not appear to worry providers, however. Jill Davies, chief executive at Westfield Health, says: “Although the NHS may be cheaper, it could now, as a result, be a lot more difficult for people to register with an NHS dentist. A cash plan gives people more choice by offering money back towards the cost of dental treatment, whether they visit an NHS or private dentist.”
Co-insurance plans, meanwhile, usually include an excess. Jagielko says some employers want to offer staff higher levels of cover during times of financial hardship. In March, Cigna launched its Oral Health Optimum plan, which provides 100% reimbursement on preventative treatment up to £300, and 80% of minor and major treatments up to £2,000. This is an increase on its previous limit of 80% of up to £1,000-worth of treatment.
Plans that reimburse staff for check-ups have long-term benefits. Dental examinations can detect signs of gum disease, cavities and conditions such as Bruxism (teeth grinding) and, if action is taken early enough, dentists can prevent more serious problems developing. Ultimately, employees who have regular check-ups could save themselves the unnecessary costs of additional treatment, while employers could cut their sickness absence rates and save money in the long run.
Some employers, particularly those that are working to cut employment costs or even make redundancies, may shy away from dental benefits at the moment. But Davies points out: “Helping the workforce with costly dental bills in a recession, and at a time when there is a shortage of NHS dentists, could have a positive effect on staff morale and productivity.”
If you read nothing else, read this…
- Dental perks, such as insurance policies and cash plans, are primarily geared towards reimbursing policyholders for the cost of maintaining good oral health, depending on their level of cover.
- The high cost of dental treatment, along with the lack of NHS dentists, has seen dental benefits increase in popularity.
- Offering dental benefits on a voluntary basis in the recession may be unsuccessful because staff want to keep hold of any expendable income.
- Employees who have regular check-ups could save themselves unnecessary costs in additional treatment, while employers could cut their sickness absence rates.