Question 2: New Rules for Dental Insurance

The idea behind dental insurance is relatively straightforward. You pay the insurance company a certain amount every month; they agree to cover some of the costs of your dental care.

But what happens if they're collecting a lot more from those monthly premium payments than they’re paying out for treatment.

Is that unfair? Or just part of the business model? And should the state get involved, perhaps by requiring dental insurers to spend a certain percentage of their monthly premiums on patient care — just as we already do for medical insurance?

Voters will get to answer these questions in November as part of Ballot Question 2, which would set new rules for dental insurers, including a requirement that 83 cents of every dollar collected in premiums is spent on patients' dental work.

This 83 cent standard is referred to as the "loss ratio." And as part of our mission to help voters understand state ballot questions, we have reviewed relevant research and spoken with a variety of experts about the potential impact a minimum loss ratio could have on dental insurance and care in Massachusetts. We found that:

• This ballot question is built on relatively thin information. It's not clear whether dental insurers are currently close to — or far from — the proposed 83 percent require- ment. Indeed, there’s no clear basis for the 83 percent figure, and imposing it would make us the only state with a fixed loss ratio for dental insurance.
• The limited information we do have sug- gests dental insurers could probably adapt to the 83 percent standard, just as medical insurers did with the similar standards set by the Affordable Care Act. Those most likely to struggle are the smaller, less-effi- cient dental insurers.
• Insurers could meet the 83 percent loss ratio in a number of ways, including by covering a wider range of procedures or by allowing dentists to charge higher prices for dental services. Some price increases might then pass through to patients.
• Question 2 also includes a number of reporting requirements that would shed useful light on the dental insurance market and allow for better-grounded regulations moving forward.