When it comes to health benefits, more attention has always been given to medical, compared with dental and vision. And yet, there is a growing recognition that oral health is closely correlated with overall health, even though dental and vision benefits are often an afterthought.
While dental and vision benefits still don’t command either consumer or employer attention, some trends are fundamentally reshaping the market that employers should pay attention to. And some of these trends didn’t exist in the market just a few years ago, explained Tiffany Johnson, National Associate Director for dental and vision at Willis Towers Watson. She was speaking at the annual Transform Summit in Scottsdale, Arizona this week. The event is hosted annually by Skygen, a large dental and vision benefits administration company based in Menomonee Falls, Wisconsin, that serves 60 million members. (Editorial Note: The company paid for some of my travel expenses but had no input in editorial coverage.)
Even though fewer dollars go toward dental and vision benefits, conversations around value-based care — that are much more prevalent in the overall healthcare industry— are slowly making their way into the dental world, especially in state-run Medicaid, explained Larry Paul, chief dental officer of Skygen, in an interview.
Here are some of the key takeaways from the summit:
Network Volatility
Johnson routinely receives two kinds of emails from clients — one noting that employees are complaining that they cannot find a dental provider in their area or two, that all providers in the employer’s network are suddenly going out of network. She described this as “network volatility” and explained that it is one of the biggest “variances that I have not seen in the last two to three years.”
Employers feel that the only solution is to broaden their network so that they can contract with a carrier having the largest cadre of providers, but that may not be the right way to think about it, Johnson cautioned.
“You want to think about why the dentists are maybe leaving the network,” she said. “Is it carrier agnostic? And do they have an understanding that across the board … about 30% of dentists left the game during Covid. About 34% of dental hygienists did the same thing.”
And those dental hygienists that remained were able to charge higher salaries, which pressured providers to charge higher rates from carriers who in turn passed on the costs to employers and then ultimately to employees in terms of higher premiums or out-of-pocket expenses.
So the fact that there is network volatility may not have anything to do with the carrier but rather part of a larger trend that affects everyone equally.
Selective Contracting
Previously, dentists would accept all kinds of dental insurance. Those days are pretty much over, Johnson declared. They are much more selective these days with carrier contracts, and what’s unusual is that they are reaching out to consultants for recommendations on who to contract with.
“They are talking with consulting firms,” Johnson pointed out. “Consulting firms that didn’t exist in the market three or four years ago.”
And these consulting firms are leveraging AI, data, and other tools to say,”Hey, I can maximize your revenue by going through the four or five biggest employers in your area going over the plan design and seeing if it’s worth using inside the network,” she said.
That is appealing given that dentists’ overheads have gone up not only because of hygienists charging greater salaries, but tariffs as well that negatively impacted the cost of tools that dentists routinely use.
Vision Market Dynamics
It’s not just the dental market that is dealing with provider shortages. It’s happening in the vision world as well.
“If you’re not aware, the average age of eye practitioners in the country is about 50 years old,” Johnson said. “The graduation rate is not going to replace those who are about to retire out. They are concerned there will be a national shortage for eye practitioners similar to dental in the coming years. So that’s a trend that we are absolutely keeping our eye on.”
Just as dentists saw the cost of their tools jump because of tariffs the Trump administration imposed last year — though a year later the Supreme Court has found it to be illegal — the vision market has seen similar price increases for lenses and frames.
Another trend in the vision market is the demand by employers from carriers to see standalone vision plans instead of bundled together with medical and dental.
“… we’re seeing an uptick in carriers having to make exceptions to quote vision on a standalone basis because of all of the impacts of the cost of [total] care,” Johnson said. “I think that’s going to continue in the future.”
Vision is becoming a “feel-good” product
Certain companies are becoming successful by their strategies to provide discounted frames and lenses at a wholesale rate.
“We are starting to see a couple of players in the market who are sometimes filed as a discount plan, sometimes filed as a carrier depending on the state, but they’re offering frames and lenses at 30% to 40% lower through traditional carriers and they are very comfortable being offered alongside a traditional carrier and they are targeting employer groups and they’re getting quite successful quite quickly,” Johnson said.
While trying to control healthcare hosts, employers are still looking to keep employees happy. And so as they contend with higher medical and dental costs, they want to use the vision plan as a way to provide value without breaking the bank.
“Employers are coming forward saying, ‘Hey, I have to deliver some bad news on medical. Can I do an enhancement on vision?… Can you throw me a bone here? Can I up the frame allowance by 20 bucks and say, Hey, we’re able to do this,’” Johnson said. “And it’s becoming a feel-good product. And for that reason they’re turning their head towards vision, but we still have to do the cost in the office to see what that means for them.”
An Overall Interest in Value
Quantifying value and quality is hard in the dental and vision markets, but that doesn’t mean employers and others aren’t interested in who is providing the best benefits in the market for their employees/members.
“So employers are saying, ‘how do my employees know who are the best benefits [providers] in their network?’” she said. “And they want to answer that [by] bringing [the issue of quality] forth in the directories.”
Related to that request is the rising interest in value-based care arrangements.
“Now I will say that this conversation is more at the American Medical Association level, certain kinds of dental care organizations are kind of discussing this, but mega-size employers are also starting to engage this conversation,” Johnson pointed out.
Skygen’s chief dental officer, a former physician who still maintains his medical credentials, said that the company is developing a program called “Nice” — non-invasive carriers elimination — to help move the conversation about reimbursement towards outcomes as opposed to being dictated by the volume of procedures done.
“It is really intended to align dentists and payers as opposed to putting them on opposite sides of the equation,” said Larry Paul in an interview during the event. “Really align them around data and align them around what the outcome of the care is and if there is care avoidance and cost avoidance, to be able to share that. That really is a true value-based arrangement.”
Paul added that states in charge of Medicaid dental plans and insurance companies with Medicare Advantage plans are pushing “to have a certain number of patients and a certain amount of spend be under value-based arrangements.”
The challenge of course, is the pushback from dentists who might view this as threatening their earning capability.
“From the dentist’s perspective, we have to create a financial incentive to do that,” he said. “We are trying to promote that because I just think it’s a better way to look at care in terms of what the outcomes of the care really are.”
