“Broken System” Aiding Dental Insurers, Coalition Says

Ballot Question Opponents Claim It Will Push Costs Up

Ray Bennett of Shawmut Strategies (left) and proponents of the dental insurance ballot question haul boxes of signatures down to Boston Common ahead of a press conference Wednesday afternoon. [Sam Doran/SHNS]

STATE HOUSE, BOSTON, JULY 6, 2022….A ballot question on track to go before voters in November would address “a broken system” that allows dental insurance companies to wring excessive profits from patient premiums, supporters of the measure said Wednesday.

Before dropping off a final batch of voter signatures required to make the ballot, dentists, patients and advocates backing the campaign to impose new limits on insurer spending pitched the measure as a consumer protection mechanism.

While opponents contend the proposal would in fact increase costs, supporters argued that requiring dental insurers to spend at least 83 percent of their dollars on patient care and improvements would more closely align restrictions on dental plans with those that health plans already face.

Dianne Morad, a lobbyist working with the ballot question committee, said during a State House press conference that some large dental insurance carriers spend as much as 40 percent of what they collect in premiums on “executive salaries, bonuses and other administrative expenditures” rather than on patient care.

“A yes vote would help fix a broken system in which insurance companies benefit from denying claims and limiting coverage,” Morad said.

The ballot question would require dental insurers to spend at least 83 percent of their dollars on “dental expenses and quality improvements, as opposed to administrative expenses,” according to its text. Carriers with medical loss ratios — a term that refers to the distribution of spending on claims and care — below 83 percent would be required to refund members for excess premiums.

Backers say in Massachusetts, many health insurance plans are required to steer at least 88 percent of revenue into patient care expenses, a limit that effectively caps how much money from premiums goes toward executive compensation.

Daisy Kumar, a registered nurse and founding member of the ballot question committee, asked Wednesday, “Why are consumers not equally protected when it comes to dental premiums?”

Arnold Weiss, a retired pediatric dentist who practiced in Brookline for 45 years, speaks in favor of the ballot initiative Wednesday on Boston Common. [Sam Doran/SHNS]

We do not expect dental insurance companies to waste our premiums by overpaying officers, having giant, wasteful commissions, sneaking payments to affiliates or gifts to parent companies that just add another layer of waste,” Kumar said. “Our insurance payments are not meant to be gifts to dental insurance companies. They are meant to help families like mine and yours.”

Morad said several industry groups representing practitioners — including the American Dental Association, the Massachusetts Dental Society, the Association of Independent Dentists, and Massachusetts Association of Orthodontists — have lined up in support of the question.

Arnie Weiss, a veteran pediatric dentist who spoke at Wednesday’s event on behalf of the Association of Independent Dentists, said the question is “something that will regulate the industry and help the consumer.”

The question, if approved by voters, would be the first law of its kind in the country, according to opponents.

The Committee to Protect Access to Quality Dental Care, which is a coalition of dental plans, health plans, life insurers and trade associations organized in opposition to the initiative, said it’s concerned the question would drive up health care costs for consumers and small businesses.

“The proponents of this ballot question are not being straight with the voters,” the committee said in a statement. “What they aren’t telling you is that their anti-consumer proposal will increase costs for Massachusetts families and employers — a nearly 40% premium increase in one recent study — and can result in thousands of residents being denied access to much-needed dental care.”

A new study conducted by Milliman Research and commissioned by the National Association of Dental Plans concluded that small carriers and those focused on small groups and individuals would have to increase premiums by almost 38 percent, from $35 to over $50, and increase claims by over 60 percent to meet the new spending benchmarks and still retain enough revenue to administer the business.

Increasing claims, the report said, could require adding benefits “beyond what is competitively offered and/or beyond what consumers desire or want to pay for — or by increasing reimbursement to providers.”

Unlike traditional health plans, Milliman Research said dental carriers tend to have similar fixed administrative costs but fewer members paying lower premiums over which to spread the expenses.

Nationwide, approximately 78 percent of dental carriers have loss ratios under the proposed 83 percent, and in Massachusetts small group plans average roughly 68 percent, while large group carriers operate at around 79.3 percent.

The report and opponents warned that passage of the ballot question could spur some dental insurers to stop operating in Massachusetts or eliminate some lines of business, reducing access and consumer choice.

“With consumer prices soaring to all-time highs, the Commonwealth doesn’t need this added regulation that will only increase costs and decrease choice for patients across the state,” the opposition committee said.

The campaign behind the ballot question to this point has been entirely funded by orthodontist Mouhab Rizkallah, who has poured half a million dollars into the effort, according to state political finance records.

If Secretary of State William Galvin certifies that the campaign submitted enough voter signatures by Wednesday’s deadline, the question will officially go on the Nov. 8 ballot.