Open wide – fresh impetus for dental plans

Although the government bowed to patient pressure by accepting NHS top-ups last November, it remains committed to a health service that is free at the point of use. But, while paying for all of your medical treatment may be a long way off, employers offering help with those areas of healthcare that have already moved towards private provision can reap valuable goodwill from staff.

For many years, if you have had your eyes tested or wanted new glasses or contact lenses you would be treated as a private patient and expected to pay. And, although NHS dentistry is still available, more and more people are finding themselves having to go down the private route.

While this may be a personal expense, for corporate advisers, this drift towards private provision is also a business opportunity. In particular, as it gets tougher to find an NHS dentist, demand for affordable dental cover is booming. Matt Reeves, corporate channel manager at Denplan, says that since the introduction of the new NHS dental contracts in 2006, Denplan has seen the number of employees covered under its schemes increase by just short of 100 per cent. “This reflects the findings of the Citizens Advice Bureau survey that of the 7.4 million respondents unable to access an NHS dentist since 2006, 4.7 million had sought private treatment and 2.7 million had gone without,” he says. “There’s a real demand for cover.”

The introduction of the new NHS dental contract was certainly a catalyst for a lot of change in NHS dentistry. At the time around 10 per cent of NHS dentists decided they didn’t want to sign the contract and moved over into private practice.

Further, according to the Department of Health’s own figures (NHS Dental Statistics, Q1 2008-09), since the new contract a million fewer adults and more than 200,000 fewer children have been able to access an NHS dentist in England.

However, while this isn’t good news for NHS dentistry, many believe the real crunch will come this April. Glenn Rhodes, head of B2B marketing at HSA, explains: “Dental funding was only ringfenced until April 2009. After that it will have to compete with other healthcare services funded by the primary care trusts such as coronary care and hip replacements. This will probably mean less favourable contracts for NHS dentists so more will go private.”

Another factor that will make dental cover more important is the phasing out of child-only contracts. With these, dentists were able to treat adults as private patients but deliver free NHS care to children. “Many PCTs are phasing out child-only contracts. This will force dentists to decide whether they want to be completely NHS or completely private,” says Reeves. “This will also make plans that include cover for dependent children more important.”

A number of options are available for employers looking to cover their employees’ dental health. Cash plans are a popular way, allowing employers to offer dental and optical cover, which are the two most popular benefits, as well as a number of other benefits such as physiotherapy, consultations and, often, employee assistance programmes.

“The beauty of a cash plan is it’s inclusive of a range of maintenance and wellbeing benefits,” says Jill Davies, chief executive of Westfield Health. “This can help with motivation, reducing absence and increasing productivity. It also gives employees choice about their healthcare, which is a valuable benefit.”

Cash plans often include cover for children too. For instance, dependent children are automatically included on the schemes of the leading providers HSA, Westfield Health andHealthsure. There are other options available too. Many of the medical insurers including Bupa, Norwich Union and Standard Life Healthcare now offer dental and optical benefits alongside more traditional PMI benefits.

As an example, on Standard Life Healthcare’s Business Healthcare planyou can add a dental module that covers a variety of dental treatments including routine examinations and scale and polish. Alternatively, employers can include a health cash plan module, which includes both dental and optical.

Brian Mulreany, managing director of health insurance brokers Essential Healthcare, favours these medical insurance options as a means of selling dental and optical cover. “It’s a very cost-effective way to cover these areas if you already have medical insurance,” he explains. “If you’ve got your own teeth and eyes you can easily claim back more than the cost of the medical insurance scheme each year.”

For instance, Mulreany recently provided some quotations for a husband and wife business that also wanted to extend cover to their two teenage children. “The price to cover them with a top of the range medical insurance scheme was £163 a month with a scheme from Norwich Union. Add in the dental and optical module and it only adds a further £9 a month to the premium. You have to question why someone wouldn’t include dental and optical in this instance,” he explains.

There are also plenty of options if an employer only wants to offer his employees access to dental benefits, whether on a company paid or a voluntary basis. Denplan is the largest provider of dental schemes and it offers six different plans with cover ranging from accident and emergency only right up to a fully comprehensive scheme.

HSA also offers a dental scheme, available either voluntary or company paid. Its company paid scheme has three levels of cover, costing £7, £10.50 or £12.60 a month per employee. “We’re seeing a lot of demand,” adds Rhodes.

“Employees are saying they want it and we’re also seeing employers using them as a way to retain employees, especially where a recruitment freeze is in place. Likewise, where pay rises are low, a dental or cash plan has a much higher perceived value than it costs the employer.”

Dental cover can also suit some demographics much better than medical insurance. Glen Smith, managing director of specialist intermediaries Healthcare Partners, explains: “If you have a young workforce then a cash plan that covers dental, optical and physiotherapy can work well as the benefits are very tangible. Employees will use the dental and optical benefits at least once a year and, if someone suffers a sports injury they can use the physiotherapy benefit to get it fixed.

With medical insurance they have to be ill to use it and this isn’t so common with a younger age group,” he explains.

And, while premiums and commissions for dental and optical cover are only small, Rhodes argues that this shouldn’t turn brokers off. “You’re selling a lot of a little,” he says. “As well as getting the volume, there’s no overlap with other products such as medical insurance and it meets the employee demand. It’s an easy sell.”

FOCUS

A closer look at optical
Paying for optical care has become the norm in the UK, and although Scotland reintroduced free NHS eye tests in April 2006, most people north as well as south of the border still need to foot the bill for glasses and contact lenses.

But, under the Health and Safety Display Screen Equipment Regulations 1992 (amended 2002), employees that work with visual display units (VDUs) such as computer screens are entitled to free eye tests and basic glasses where they’re required for VDU use.

However, according to a survey by Specsavers Corporate Eyecare, many employers are failing to meet these requirements. It found that 81% of the employers it interviewed were failing to meet their requirements because they were only making a contribution towards the cost of the eye test and glasses, rather than meeting the cost in full.

It’s not surprising employers are falling foul of the rules as they’re not completely transparent. For instance, although employers must pick up the cost of eye tests for employees using VDUs they do not need to insist that they have an eye test. Further, although many companies fund for annual check-ups, the regulations state that the professional guidance of the optician should be followed and often this stipulates an eye test every two years.

There are a number of ways a corporate adviser can help an employer cover off their optical health and safety duties. As well as using the benefit on cash plans or through a dental and optical option on a medical insurance policy, a common method is through an eye care voucher scheme.

These are operated by a number of companies including Accor Services, Specsavers and Vision Express and enable employers to give out vouchers to staff that will cover the cost of an eye test and basic glasses. For example, Specsavers charges £17 for each voucher, but this covers the eye test plus a pair of glasses from its basic range. It’s also possible to put together tailored schemes. For example, specialist intermediaries Healthcare Partners works with a local optician to provide optical services to clients. Glen Smith, managing director of specialist intermediaries Healthcare Partners, explains: “We arrange for his staff to go into companies and test employees’ eyes. This helps to reduce the cost to employers and is a valuable add-on service that benefits our relationship with clients.”