RISING DENTAL COSTS CONTINUE INTO 2023

TYPICAL COST INCREASES IN THE PAST FEW YEARS, AND THIS TREND IS EXPECTED TO CONTINUE WITH THE RELEASE OF THE DENTAL FEE GUIDE ADJUSTMENT FOR 2023.

The dental fee guide is maintained by provincial dental associations. Its purpose is to recommend appropriate fees for various dental services. The fee guide serves as guidance for dentists (i.e., they are not mandatory). However, most dentists follow the recommendations in the Dental Fee Guide and align their fees to the Guide. For group dental plans, most insurers will establish reasonable and customary reimbursement rates based on the Dental Fee Guide, which means any adjustments will have a direct impact on dental plan costs.

2023 Fee Guide Adjustments

Early each year, most provincial and territorial dental associations publish their respective dental fee guides. The weighted adjustments across all types of services available in British Columibia for 2023 are illustrated in Figure 1.

The British Columbia dental fee guide cost adjustment for 2023 results in increased costs of 5.99 per cent. This means plan sponsors can expect their dental costs to increase by roughly 5.99 per cent in 2023 if their utilization (i.e., frequency and type of services used) remains consistent compared to 2022 utilization.

This is the second consecutive year BC plan sponsors have experienced increased costs due to increases in the Dental Fee Guide (the 2022 adjustment resulted in a 7.35 per cent increase). There could be a variety of reasons that the recent increases are substantially higher than prior years, but there are a few potential drivers:

• Upward inflationary pressures have been observed in the broader Canadian economy.

• Reduction in revenue to dental offices due to Covid-19 (fewer patients, more time and costs associated with maintaining PPE protocols).

• Irregularities in data in 2020 and 2021 due to Covid-19 restrictions. Dental Fee Guide increases could be addressing insufficient increases from 2020 and 2021.

• Talent shortages in the dental industry leading to higher cost structures within service delivery.

Apart from the first bullet regarding inflationary pressures, several of the possible reasons identified are short-term in nature.

WHAT CAN PLAN SPONSORS DO?

Plan sponsors do not control the Dental Fee Guide. Therefore, it is important to review the levers under your control to manage your dental costs. It may be prudent to your plan design (reimbursement levels and calendar year maximums for basic and major coverages) to ensure you are not exposed to undue risk, while also considering whether your delivery model is as efficient as it could be. Managing these two aspects of your plan effectively should help navigate these periods of higher service costs.

About The Author

This article has been drafted on behalf of the UBCM Benefits Plan, a collective of approximately 130 municipal and affiliated groups across British Columbia. If you have any questions about the Plan, please contact Elvira Khismatullina (GroupBenefitsPlan@ubcm.ca) and we would be pleased to assist you