Making your family’s dental care more affordable! Part 4: Your entitlements

“Health insurance” can be a misleading term when it comes to dentistry.

It makes little sense to be ‘insured’ for a chronic disease. Dental disease is a chronic, pre-existing disease in a large number of people. Any other health insurance would impose exclusions on these kinds of conditions, for which people are likely to make a claim or likely to do so frequently. Instead, dental insurance policies charge everyone the same premiums, whether they are healthy or unhealthy and makes no distinction (or it does only rarely) in the rebate values for those who only occasionally claim one expensive item and those who may claim such items regularly.  Even if there is such a ‘reward’ out there, it is usually fairly insignificant when compared to premiums paid by those ‘insured’.

Those who attend their dentist regularly, claim mainly on preventative care items and occasional minor restorations and never reach their yearly claim threshold, yet they pay for it. Those who don’t attend regularly, when they do claim, they invariably reach their claim thresholds, which may or may not cover a significant portion of their dental cost. Yet, they also may have been paying for the insurance policy and not claiming any items for years.

Dental ‘insurance’ is not really an insurance, it is more of a savings account with a very high account maintenance fee!

Luckily, dental problems are predictable. Your chances of more serious dental complications or need for complex treatment can increase every year if you:

• had your teeth restored early in life: restorations need constant maintenance and replacement to keep them safe and sound
• have a high risk of tooth decay and gum disease: this can be assessed by your dentist and hygienist and depends on your lifestyle, age, medical status, family history, etc.
• have heavily restored teeth, which cannot be re-treated if they become problematic: these teeth may need to be extracted in future and implant treatment may be the next step in your mouth’s rehabilitation
• have missing teeth: even though you may be used to having toothless gaps, if you continue to lose teeth you will find it more and more difficult to function, especially later in life.

It is important to understand your dental condition, your risk and need for future treatment before taking up dental ‘insurance’! Hence, the importance of getting a thorough treatment plan from your dentist. If you are likely to need some assistance from a health fund for future treatment, then you should consider the cost of premiums for levels of cover which would be suitable to your future treatments (i.e. major dental treatments).

Be aware that ‘extras’ cover in your health insurance often covers more than just dentistry and can include other disciplines of health, such as physio, chiro, nutritionist, optical, naturopathy, etc. Your yearly rebate limits often apply to all those claims, combined. If you use any of these other services, you may struggle to work out exactly what rebates you are entitled to and where. However, if you have your treatment plans in front of you, you are entitled to ask for a quotation from a health fund of your rebate amounts for each item number stated in your treatment plan. That way you can decide which health fund provider offers best terms for treatment YOU need.

Do you currently have any private health insurance, with ‘extra’ cover for dentistry?

It is a good idea to contact your health fund provider and obtain an estimate of rebates for each item on your treatment plan(s). At the same time, ask for your remaining ‘balance’, your yearly rebate limit and the date your cover ‘rolls over’ and the limit ‘renews’.

You can then work out your total ‘out of pocket’ expense for the year.

Will you spend more than $1500 ‘out of pocket’ on your total health care costs in this financial year?

If  you do, you will be entitled to claim any amount over the $1500 threshold in your tax return and are likely to get a 20% tax rebate (e.g if your total ‘out of pocket’ health care costs- medical, dental, chiro, physio, optical, pharmaceuticals, etc. (cost after medicare claims or rebates and private health fund rebates) are $2000 for this financial year, you can claim $500 in your tax return and are likely to receive a $100 tax rebate)

Now you can work out the ‘true’ cost of your yearly dental treatment and put it in your family’s budget.

Are you currently considering taking up private dental insurance?

Most health funds will allow new members to claim immediately on preventative care items. Even though this sounds great and often comes with other ‘sweeteners’ in the highly competitive market, consider shopping around for a health fund which suits your dental condition, to avoid getting ‘stuck’ in a fund and then ‘adapting’ your dental condition to suit their rebates!

Simple calculations to help when choosing new dental insurance cover

Will your total yearly extras premiums exceed your total yearly rebates?

If so, your family’s expenses will actually go up if you take on extras cover, you may be better off putting money aside for dental treatment. If you use a savings account for this, you can also earn interest.

Calculate your ongoing preventative care expenses:

• Work out what monthly or weekly amount you would be expected to put aside for your yearly preventative care cost without taking on health insurance.
• Work out what your monthly or weekly premiums would be on a range of different levels of cover and in a few different health funds (what you would pay the health fund).
• Ask the health funds what your rebates would be for the preventative care item numbers on each of those levels of cover (what the health fund would pay you or the dentist to cover parts of their fees).
• Deduct the rebates from the dentist’s fees and work out the total yearly ‘out of pocket’ cost.
• Divide the yearly ‘out of pocket’ cost into monthly or weekly instalments, add to that your monthly or weekly premiums and compare this amount to what your monthly or weekly costs would have been without dental insurance.
• IS IT WORTH IT? Are you better off putting your money into a savings account instead, until the time comes to pay for your preventative care visit?

Calculate true cost of your short term and long term treatment:

Considering that there are minimum 6-12 month waiting periods for all new health fund customers to be able to claim for dental treatment other than preventative care, you may be risking your health if you rely on this to kick in before you start your short term treatment plan.

However, consider the same calculation you completed above for your preventative care, this time for your long-term treatment plan. How much will you be spending on your premiums, how much will be your out-of-pocket expenses and what, if any, is the difference between having this dental insurance and not? To choose the health fund most appropriate for you, follow the best savings on the total expenses, but also look for a fund with least restrictions on item numbers and providers, as well as generous yearly limits.

THINGS TO ASK YOUR HEALTH FUND CUSTOMER REPRESENTATIVE:

1. Rebate for your level of cover for each item number in the treatment plan (don’t settle for an answer that you will get 50-90% of each item, some funds refuse to rebate for certain item numbers, make sure you get an accurate quotation for each item)

2. Your yearly rebate limit and your current balance

3. Are there any ‘bonuses’ available if you claim less than that yearly limit and how are these bonuses claimed?

4. Do you currently have any waiting periods or restrictions on the types of dental treatment you can claim for?