Insurance Reforms
Stand-alone dental plans are generally exempt from the insurance market reforms because the exception for "excepted benefits" applies. This includes the market reforms for: lifetime or annual limits; prohibition on rescissions; preventive health services; dependent coverage; uniform explanation of coverage and standard definitions; discrimination based on salary; quality of care; medical loss ratios; appeals; prohibitions on preexisting condition exclusions; premium rating; guaranteed availability; guaranteed renewability; health status nondiscrimination; comprehensive essential health benefits; and waiting period requirements. Apart from these market reforms additional requirements may be applicable to pediatric dental coverage offered in an Exchange.
Exchanges
The bill establishes state-based Exchanges that facilitate the purchase of health insurance coverage and related insurance products at an affordable price by qualified individuals and qualified employer groups. The legislation also allows for regional exchanges operating in a defined geographic area. Exchanges will be administered by a governmental agency or a not previously established non-profit organization. Initially, coverage through Exchanges will be offered only to individuals and small-group health plans (up to 100 employees). Stand-alone dental plans can be sold in Exchanges in order to meet the pediatric dental requirement of any coverage offered in the Exchange. Subsidies can be used in the purchase of the pediatric dental plan. Individuals may continue to purchase insurance outside of the Exchange structure but will not be eligible for subsidies. Exchanges will impose a surcharge (targeted at roughly 3 percent) on all participating plans. While state-based exchanges are enabled by the bill, the exact nature and operation of the various state exchanges, including the benefits to be offered through the exchanges, will depend in large measure upon decisions made by the individual states.
Benefit Tiers in Exchanges
The law creates four benefit tiers listed as bronze, silver, gold and platinum. All tiers include a pediatric dental requirement for all levels of coverage.
Essential Health Benefits
In order to be offered in the Exchange, a Qualified Health Benefit Plan (QHBP) must offer a package of essential health benefits. One of these specified benefits is a pediatric dental benefit. The HHS Secretary will define the essential benefits, controlling the specific plan scope of the pediatric dental benefit. In 2014, when the Exchanges are operational, all coverage in the Exchange must meet the essential benefit requirements. Essential health benefit requirements extend outside the Exchanges to individual and small groups at the same time (2014).
Stand-alone dental benefits
Stand-alone dental benefits can be offered in the Exchanges in order to satisfy the requirements of an essential health benefits package for providing a pediatric dental benefit. However, further work is needed to clarify the treatment of stand-alone dental outside of the Exchange, beginning in 2014.
Grandfathered plans
Any group health plan or health insurance coverage in which an individual was enrolled is considered “grandfathered,” and this status exempts the plan from a number of provisions contained in the bill including: annual/lifetime caps, meeting essential benefit requirements, premium ratings, preventive services cost-sharing and rescissions. An individual can renew this coverage and add dependents after enactment without changing the status of their grandfathered coverage. Grandfathered plans are subject to some of the reforms: uniform explanation and definitions; medical loss ratios; waiting periods; lifetime limits (annual limits for group); rescissions; extension of dependent coverage; and preexisting conditions (group only). But as an excepted benefit, stand-alone dental is not subject to these requirements.
Dependent Coverage
Plans offering individual or group coverage to a beneficiary’s dependent children must make the coverage available until the child turns 26. This provision applies to all plans 6 months after enactment. As an excepted benefit, stand-alone dental is not subject to this requirement.
Premium Ratings
Insurers offering individual or small group plans can base premium rates only on: whether such plan or coverage offers an individual or family, age (3:1), tobacco use (1.5:1) and geographic area based on rating areas as defined by the state insurance commissioner. As an excepted benefit, stand-alone dental is not subject to this requirement.
Excise Tax on High Cost Employer Group Health Insurance Policies
Beginning in 2018, high cost, employer-provided “Cadillac plans” will be taxed. Any amount of a plan value that exceeds $10,200 for single coverage and $27,500 for family coverage will be taxed at 40 percent. Those thresholds are indexed to inflation and are higher for retirees and employees in high risk occupations. Stand-alone dental and vision plans are excluded from the tax calculation in the reconciliation language.
CHIP
States are required to maintain current income eligibility levels for children in Medicaid and CHIP until 2019; benefit packages and cost-sharing rules will continue as under current law Beginning in 2015, states will receive a 23 percent increase in the CHIP match rate, up to a cap of 100 percent. CHIP eligible children who are unable to enroll in the program due to enrollment caps will be eligible for tax credits on the state Exchanges. Children’s parents will be using tax credits to purchase coverage which would include a pediatric dental benefit.
FSAs
Limits the amount of contributions to a flexible spending account for medical expenses (including dental) to $2,500 per year, effective in 2013.
No Lifetime or Annual Limits
Eliminates lifetime limits for individual and group plans six months after enactment. Eliminates annual limits for individual and group plans in 2014. As an excepted benefit, stand-alone dental is not subject to this requirement.
Annual Fee on Health Insurance providers
The legislation raises $70 billion over ten years, assessed by market share. Dental is NOT excepted from this annual fee. Here is a breakdown of how the fee will ramp up in the next ten years:
|
Year
|
Level
|
| 2014 |
$8 billion |
| 2015 |
$11.3 billion |
| 2016 |
$11.3 billion |
| 2017 |
$13.9 billion |
| 2018 |
$14.3 billion |
Subsequent years — Previous year plus rate of premium growth
The legislation provides a partial exclusion for tax exempt activities. Eligible non-profit organizations will pay a tax on 50 percent of net premiums.
Additional Oral Health or Dental specific provisions
- Oral Health Prevention Campaign – The bill establishes a five-year oral health campaign targeted at children, pregnant women and minorities.
- Grants for Caries Research – HHS will be empowered to award grants to demonstrate the effectiveness of research-based dental caries disease management activities.
- School-based Sealant Grants – Grants will be made available in all 50 states.
- Cooperative Agreements – HHS will partner with state, local and tribal governments to establish “oral health leadership.”
- Surveillance Activities – HHS will update and improve Pregnancy Risk Assessment Monitoring System with a specific focus on improving oral health.
- Workforce – Oral health was called out as a special area of need in the bill, and HHS will be empowered to extend grants to dental schools.
- Alternative Dental Health Providers – The bill calls for a two-year demonstration project that will look into the efficacy of mid-level providers.
Time line
6 months
- Eliminates lifetime limits for all plans. As an excepted benefit, stand-alone dental is not subject to this requirement.
- Requires dependent coverage through age 26 for all plans. As an excepted benefit, stand-alone dental is not subject to this requirement.
- Other "immediate" insurance market reforms. Dental plans are exempt as excepted benefits.
2011
- Limits on FSA contribution imposed (effective 1/1/11).
2014
- Mandates essential health benefits for small group or individual plans offered inside a state Exchange – AND – on all new small group or individual plans outside the Exchange. Stand-alone dental is exempt as an excepted benefit.
- Eliminates annual limits for new and grandfathered group plans (“restricted” annual limits permitted beyond 2014, as an excepted benefit, stand-alone dental is not subject to this requirement).
- All US citizens and legal residents are required to purchase coverage. A penalty will be assessed if they do not.
- General insurance "reforms" including premium rating rules apply on individual and small group. Stand-alone dental is exempt as an excepted benefit.
- Annual insurer fee begins.
- States must have Exchanges operational.
2017
- States may allow employers with more than 100 employees to purchase insurance in Exchanges.
- Mandates "qualified" health plan with essential health benefits for all large group plans (except for self-insured plans) offered in a State Exchange.
2018
- High-value, “Cadillac” employer-provided group health plans taxed. Dental plan value is exempted from calculated total value.
2019
- CHIP funding extended through 2019.