There’s passion and commitment in his voice when Joseph A. Nagle, president and CEO of Delta Dental of Rhode Island, talks about dental insurance and national health care reform. These days, he is on a mission to change what he terms an unintended consequence of health care reform – the fact that dental-insurance companies that don’t offer a separate health insurance product may find themselves at a competitive disadvantage when the planned health care exchanges begin operation in 2014.
For the last two years, as the nation has moved forward on health care reform, Nagle has often found himself immersed in the nitty-gritty details of the new law and its frequently shifting political realities.
PBN had a chance to catch up with Nagle after he attended a session hosted at a Boston law firm about the expected legal challenges and outcomes of health care reform.
PBN: Beyond the ideological debate, what are the practical concerns you have about the ability of the planned health exchanges under health care reform to deliver affordable services in the marketplace?
NAGLE: While the dialogue about health care reform is quite strident and politically divisive, the contentiousness centers mostly on how to pay for expanded coverage and not on a defense of the status quo. As I see it, there are three essential tenets that impact the affordability of care under health care reform: individual mandates to purchase insurance; tax credits; and cost control measures.
The fundamental principle of insurance is to spread the risk. If we don’t include the youngest and healthiest in the exchanges, then the cost of caring for the sick and elderly becomes unaffordable. The individual mandate is the key lever to ensure a broad risk pool. That’s why the recent decision of a federal District Court judge in Virginia to contest the constitutionality of the mandate is so important. If this decision is upheld by the U. S. Supreme Court, I believe it will be highly unlikely that reform will be successful, since those covered via the exchanges will be much less healthy than the overall population.
The second critical factor of success will be whether the tax credits offered to small businesses are effective as incentives to provide employer-sponsored health benefits. Employer-paid health benefits lessen the strain on the total cost of care provided via the exchanges. Republican threats to “starve” the funding of health care reform are expected to target these credits and, if successful, will seriously jeopardize the success of reform efforts.
Yet even if the individual mandates and tax credits are implemented and prove to be effective, they do not address the issue of runaway costs. Without effective cost controls, health care reform is doomed to fail. We need to change the financial incentives to over-treat, and health care reform will encourage new approaches. However, it is far too early to predict whether any of these “experimental” approaches will have the desired results.
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PBN: You have voiced concern about how separate dental-insurance plans are treated under the new law. What’s the problem?
NAGLE: The impact of health care reform on standalone dental benefits is an unintended consequence of the legislative process. Today, outside the proposed exchanges, dental insurance is purchased separately from health insurance 98 percent of the time. The two largest dental insurers in the country are Delta Dental and MetLife – neither of which offers health insurance.
While we support the inclusion of pediatric dental benefits as part of the essential benefits package, the problems lies with the structure of the exchanges. Dental benefits are permitted to be offered separately on the exchanges – but they are not required to be separately priced and offered. Consequently, even if companies like Delta Dental are permitted to offer dental benefits, unless health insurers are precluded from bundling dental benefits with their health insurance offering, an individual will never have the opportunity to select Delta Dental – or MetLife, for that matter.
The individual will have been forced to select the dental coverage embedded in the health insurance package. In some cases this may require them to change their dentist. This is simply not good public health policy.
The way to fix this unintended flaw is quite simple: require that dental benefits be priced and offered separately from health insurance on the exchange. Doing so promotes transparency and competition – and competition leads to a better value.
PBN: Delta Dental of Rhode Island is currently the largest player in the Rhode Island market, with about 600,000 members. Do you welcome competition from others in the market?
NAGLE: Delta Dental currently has more than seven times as many members as our next largest competitor. We’ve achieved such market leader status precisely because we welcomed the challenge presented by our competitors. We face formidable competition every day – whether it’s MetLife, Aetna, CIGNA, Blue Cross & Blue Shield of Rhode Island or a host of other competitors.
This competition has inspired us to provide the highest levels of service at the lowest possible price and we’ve done so. Our customer satisfaction survey results report in excess of 96 percent of satisfied customers. And, over the last 18 years our annual premium increases have averaged less than 4 percent, and our administrative costs per subscriber are actually lower today than they were 18 years ago. So, we not only welcome but thrive on meeting the challenges presented by our competition.
PBN: Both the R.I. Senate, with its new commission looking at hospital costs, and Gov.-elect Lincoln D. Chafee, with his plan to create a new task force headed by Lt. Governor Elizabeth H. Roberts, have put the issue of health care reform implementation front and center. What kind of role do you envision for yourself and Delta Dental playing in these efforts?
NAGLE: I expect to be integrally involved in the process of designing and implementing health care reform in Rhode Island. While dental benefits are only a small piece of the overall reform package, I believe my experience in the industry will be helpful.
I have been a leader in the health and dental benefits industry in Rhode Island since 1985 – serving in senior management roles in United HealthCare and Blue Cross & Blue Shield of Rhode Island, as a board member of Neighborhood Health Plans of Rhode Island, and as a health care benefits consultant before my tenure with Delta Dental began in 1992. And, dental benefits, which emphasize the importance of preventive care and affordability, should serve as a model for health care reform.
PBN: The importance of oral health care of teeth, gums and mouth is sometimes overlooked in conversations on overall health concerns. Do you think there needs to be a strategic communications effort to change that? How would you accomplish that?
NAGLE: Focusing on preventive care and providing oral health education is central to our mission. The body of scientific knowledge that connects oral health to overall health grows every day.
We’ve long known that the mouth is a window into the rest of the body and that many diseases first become evident via an oral examination. One example is the connection between periodontal disease and diabetes.
We are currently partnering with the University of Buffalo Dental School on a clinical research project that seeks to determine whether the dental office is an effective setting to screen for previously undetected diabetes or pre-diabetes. The premise is that individuals see their dentists usually twice as often as their physicians, so early detection may be possible.
The study is nearing its completion, and we will be sponsoring an oral health symposium in 2011 to present our findings – but the preliminary results are very promising. In excess of 10 percent of those screened to date have been confirmed by their physician as having either diabetes or pre-diabetes. If the early findings are confirmed when the final tally is tabulated, the implications are very significant, since early diagnosis can lead to lifestyle and diet changes which could have a profound effect on the health and quality of life of our members.
