Showing posts with label Is Individual Dental Insurance a good idea?. Show all posts
Showing posts with label Is Individual Dental Insurance a good idea?. Show all posts

Sunday, December 04, 2011


By Dr. Henry Kim D.M.D.
December 4, 2011

Your friends that work for big business have dental plans. You hear them talk about it paying for so much of their dental needs: crowns to make their front teeth pretty, and braces for their kids. You are self-employed, or work for a small family-owned business. It’s only natural to want the same great deal your friends have. Then you see a poster on a telephone pole, advertising a great family dental plan. It will cost only $20 a month, but supposedly save you 30, 40 or even 50 percent on the cost of dentistry. Should you bite?

First, it is interesting to note that dental “insurance” (a misnomer if there ever was one) was not invented as a cost-efficient way to make dental care more affordable. It was an animal birthed by labor unions in the late 1950s. They correctly saw that high progressive tax rates of the era would wipe out a lot of any wage increases they negotiated. So instead, they pushed for dental insurance, which let them shield wages from taxes.So corporate dental plans were really a clumsy and inefficient idea that were not well conceived. At least 30%, and sometimes up to 50%, of dental premium dollars is eaten up by claims administration. Not a good deal at all!

Once instituted, dental insurance became a sought-after employee benefit in the non-union sector as well. It offered the same tax-shielding benefits for non-union employees. Unfortunately, no one ever examined the efficiency or wisdom of the convoluted claims administration process employed by dental “insurance” carriers.