Backed by children’s health advocates, California Insurance Commissioner Dave Jones is challenging the state’s health insurance exchange over the way it wants to provide children’s dental benefits.
At issue is whether pediatric dental care should be part of the basic health insurance package sold through the exchange or sold separately. The exchange has proposed selling it on a stand-alone basis to parents.
Jones says the exchange, called Covered California, is running afoul of federal and state laws and increasing costs for consumers by going that route. The elected commissioner said Covered California is doing so even though the federal Affordable Care Act includes pediatric dental services as one of 10 “essential health benefits.”
In a letter this week, three California lawmakers also urged the exchange to include children’s dental benefits in regular health plans to expand access to care and to hold down costs.
Covered California’s executive director, Peter Lee, said the exchange is still examining various options for children’s dental coverage and that its current proposal represents a good mix of plans at affordable prices. He flatly rejected any notion that the exchange is skirting the law.
“Covered California is very much following the spirit and intent of both the federal law and all applicable state laws,” Lee said. “A lot of the issues around pediatric dental are complex and confusing. The board has not made any final decisions.”
The dispute has already prompted healthcare groups to line up on both sides of the issue. Some dentists support the exchange’s approach because they say it enables parents to better see their dental options, while some children’s health organizations echo the insurance commissioner’s complaints.
Health insurers have pledged to work with state leaders on whatever the final rules may be, but they caution that time is running short before open enrollment begins Oct. 1.
Despite being labeled an essential benefit, this dental coverage for children up to age 19 is optional to buy. In contrast, most Americans are required to buy health insurance starting in January or pay a penalty.
Last week, Covered California selected six companies to offer pediatric dental coverage through the state exchange. In most cases, they are available as stand-alone plans that can also be bundled with medical insurance for a single premium.
The six companies were Anthem Blue Cross, Blue Shield of California, Delta Dental of California, Health Net Inc., Liberty Dental Plan and Premier Access Dental.
The exchange said stand-alone premiums range from $9 a month for a dental HMO to about $35 a month for a dental PPO plan depending on where a consumer lives.
Jones said a stand-alone or bundled dental policy will be more expensive than if the benefit were embedded in every health insurance policy, thereby spreading the cost across a broader pool of people.
For instance, he said, pediatric dental benefits would cost about $6 per month as part of one insurer’s overall health plan, but it was $26 per month on a stand-alone basis. Families could also face separate limits on out-of-pocket spending for medical and dental care, Jones said.
Lee said it remains unclear whether consolidating health and dental benefits into one policy will save policyholders substantial money. The inclusion of dental coverage in some health plans and not others may also complicate the exchange’s goal of setting uniform benefits across insurers so consumers can easily comparison shop.
In a letter last week, Jones called on the exchange and its five-member board to reverse course before enrollment opens Oct. 1.
“I object to Covered California telling health insurers and HMOs that they are restricted from including pediatric dental coverage as part of their major medical insurance” both inside and outside the exchange, Jones said in an interview. “I believe Covered California has exceeded its authority.”
Separately, a group of five children’s advocacy groups also urged Covered California to reconsider its stance and take more public input on the issue.
Wendy Lazarus, co-president of the Children’s Partnership in Santa Monica, said she is primarily concerned about Covered California’s approach making dental coverage too expensive for families.
“We’re not talking about a rarely used service,” Lazarus said. “Kids need dental care as much as they need immunizations. This is a decision that affects hundreds of thousands of kids.”
Paul Reggiardo, a pediatric dentist in Huntington Beach and a spokesman for the California Dental Assn., said he supports the idea of stand-alone dental plans because it helps parents shop for benefits and provider networks.
But he said he’s disappointed the state hasn’t made pediatric dental coverage mandatory given the recognition it was granted as an essential health benefit. It’s up to states to decide whether to make pediatric dental a required benefit.
Lee said the exchange board will probably discuss that idea and these other issues at an upcoming meeting.
This latest criticism from Jones adds to previous disagreements with Covered California. In May, Jones complained about the exchange’s selection of 13 health insurers, saying there weren’t enough plans offered statewide and that the lack of competition could drive up rates for consumers.
Then Jones ratcheted up the pressure even further last month by asking the exchange to bar insurance giant Anthem Blue Cross from its small-business market because of what he called unreasonable rate increases on employers. Lee said the exchange will consider that request along with other factors before announcing its health plans for small employers next month.