“Insurance” Math for Patients Who Don’t Like Math or Insurance
We have a guest columnist for this issue of the Fisher Jones Family Dentistry Blog. He is Marshal Brickeen. We like his perspective on dental plans and their role in your dental care.
This has become an important issue as plan benefits decrease and restrictions and exclusions increase. We hope you find this article informative and enlightening. If you have any questions, please feel free to drop us an email or plan to discuss it at your next dental appointment.
“Insurance” Math for Patients Who Don’t Like Math or Insurance
Last night at our dental study club I got on a rant. I rant enough to be diagnosed with Tourettes, and last night’s hit a special nerve that caused more irritation
than a knock-off mystery metal implant through the alveolar canal. Somebody brought up insurance–not real insurance, but dental insurance.
Dental insurance is NOT insurance. It’s so ridiculously not insurance that it deserves lame air quotes. Dental “insurance” is a very simple scam, far less complicated than
the common Bernie Madoff ponzi or “you’ll get Social Security some day” schemes. Here’s how I explain dental “insurance” to patients:
• If a rock strikes my head (and many people are throwing strange objects at me now), Blue Cross says: “Marshall, go get yourself fixed. You pay the first $500 andyourinsurancewillpaytherest.”
• If a rock strikes my car, State Farm says: “Marshall, go get the Prius fixed. You pay the first $500 and your insurance will pay the rest.”
• If a rock strikes my teeth, Delta Dental says: “Marshall, go get your teeth fixed. Delta will pay the first $500 and you pay the rest.”
That is not insurance! Insurance insures against something catastrophically expensive, like the night I had kidney stones and spent four hours in an ER bed with a morphine shot for a total of $16,500. Dental “insurance” gives patients a little bit of
money to pay for a large bill, namely up to $1,500 if you have a “good” plan, or more commonly $1,000. What was the average dental insurance reimbursement back in 1967, you may ask? (Coincidentally I have that data.) It was $1,000. Also in 1967 a gallon of gas cost $0.33, an ounce of gold was $35, the median US house cost $16,500 (now the price of a 4-hour ER visit and some watered- down morphine), and a dental crown was $65. Today that crown is at least $1,000 (anything less and its core was a junked car battery in China two weeks ago). Everything else in the country has inflated in the last 44 years; gas is up 1,320%, gold 4,750%, homes up 1,495% even after the housing crash. Yet dental“insurance”benefits remain exactly the same.
Of course dental “insurance” premiums are up. So are dental “insurance”“company” profits and executive salaries. In 2007 and 2008 Delta CEO Thomas Fleszar brought home $5.5 million in salary and benefits–at least that’s what he reported to shareholders, and I have no reason to believe that a dental “insurance” executive wouldn’t be totally honest. And he deserves every million. Tommy Boy Fleszar and the rest of those geniuses running the “non-profit” known as Delta are all doing a bang-up job!
Let’s get back to the “benefits” of dental “insurance” (and I hate using air quotes, but I hate dental “insurance” more and it’s oddly “appropriate” in this case). As a small business owner (I do own a CBCT dental imaging center and consider its four employees my responsibility) I recently went dental “insurance” shopping. It was almost exactly NOT like shopping for a new car. I didn’t see anything I wanted and the sales people could care less what I bought.
As stated I can get at most $1,500 in dental “insurance” benefits. Does that mean they’ll cover all of my $1,200 crown? Of course not–that’s as likely as the DMV lady enjoying her job. Dental “insurance” will pay an undisclosed portion of
each procedure, based on a top secret equation averaging the Usual and Customary Rates of dentists in my home of San Francisco, the nearby cow-town of Lodi, somewhere in eastern Kansas, and the US territory of Guam. That’s why my dentist, with 25 years of experience and $30,000 of practice management software, has no clue what my dental “insurance” will cover. I finally figured out that if I get enough dentistry done, eventually my “insurance” will pick up about $1,500 of the bill. If I’m lucky.
For this “benefit” I pay only $175 per month. Let me save you a trip to the calculator. $175 per month, times 12 months, equals $2,100 per year I pay to my dental “insurance” for the awesome benefit of wrestling a maximum of $1,500 in dental reimbursement each year. That’s the kind of math that sunk the Greek economy. It also sunk my allegiance to dental “insurance,” and I’m now paying out of pocket (or in CEREC blocks… I “found” a few).
I recently cornered a mid-level executive from a well-known dental “insurance” company and asked a few questions. I can’t say which company, but I can say it rhymes with “smelt ya!”
It went something like this (I changed his name to protect the guilty):
• Me: “Why are my maximum annual ‘insurance’ benefits less than my annual premiums?”
• Thief:“They’re pretty close.”
• Me: “No, I lose about $600 per year if I max out my benefits.” • Thief:“Uh…most clients don’t do that much math.”
• Me: “I multiplied my monthly payment by 12. It’s not quantum physics.”
• Thief: “Still, most people don’t think that way.” (see my We’re Stupid post)
• Me: “That’s not much of an answer… why do I seem to be
losing so much each year.”
• Thief: “[Smelt-Ya] is a big company. We need to cover overhead expenses, and shareholders.”
• Me: “Your executives and shareholders are doing well?”
• Thief: “Very well! We’re a solid company.”
• Me: “But wouldn’t I–and all of your ‘clients’–be better off without you, just pocketing our $2,100 and paying your ‘up to’ $1,500 worth of coverage?”
• Thief:“Like I said, most clients don’t do that much math…”
My We’re Stupid blog post is becoming more all-encompassing, and not just because we’re approaching an election circus. Dental “insurance” is only for people who are really bad a math. Dental “insurance” should be sold at 7-11 with lotto tickets. However, there’s a reason why it cheats all of its clients. With normal insurance, like fire or auto theft, the insurance company charges everybody a little and then gives payouts to the few people who suffer those events. I don’t know anybody who
has had a house burn down or a car stolen, yet I (and all of my friends) have home fire and car theft insurance.
Our mouths are a different story. We use them every day, and humans (for the first 99.5% of our existence) didn’t usually live past our 40s. Now we do… but were our teeth made to? Were our teeth made to withstand chewing ice cubes and opening beer bottles at parties and nail-dissolving soft drinks and hard candy we sadistically label jaw breakers? Our teeth break. And they’ll continue to break, annually, regularly, completely, either by fracture or decay. And we’ll need some level of dental care every year. Dental “insurance” companies can’t spread the risk when there’s a better than average risk that we’ll all need a lot of expensive care. It’s like a life insurance company targeting a leper colony. Bad business…unless you raise the annual rates to exceed the annual coverage, and hope nobody does the math.
I just did the math for you, and it isn’t pretty. Neither is dental “insurance.”
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