Taking the bite out of dental insurance

While many agencies are reducing employee benefits, the Dundee Township Park District administers a successful and an affordable insurance program.

By Rick Bemm

In 1982, the Dundee Township Park District purchased conventional dental insurance for its 29 full-time employees and their dependents. This program was continued for two years at an annual premium of $4,350. Facing a sizeable premium increase for 1984, the district began to examine alternatives.

It quickly became apparent that the insurance company had gained the most from its program. Benefits paid out for two years did not exceed 57 percent of the premium costs. In fact, if all claims submitted were paid at 100 percent, the cost would not have exceeded the premium payout.

The alternative was to establish a self-insurance dental program. Unlike major medical insurance with its "unknowns," the dental program had an established individual maximum benefit of $1,000, which was in our means. Experience during the past two years substantiated the unlikeliness that such a payout would be made. For 1984 this again proved to be true.

During its first full year of self-insurance, the park district made payments on 26 claims totaling $2,600. This reflects a $1,700 savings over the 1983 conventional premium cost.

How the program works

Our policy is probably similar to that of conventional insurance carriers. The cash deductible is $50 per insured person during the calendar year. However, 100 percent of a claim with no deductible applied is paid for diagnostic and preventive services and supplies. Restorative and surgical services are paid at 80 percent, with the exception of gold restoration and prosthetics. These services are paid at 50 percent.

Claim forms can be designed to meet both the agency's and the dental community's needs. Because dentists use code identification to describe their work, a procedures and nomenclature manual should be acquired from the American Dental Association, 211 E. Chicago St., Chicago, IL 60611. This will help identify the type of service rendered and the percentage of payment to be made.

Our program has required a minimal amount of administration. All claims are processed through an insurance coordinator, with final approval on payouts made by the park district director. Because the district is able to act on claims immediately, the employee or dentist receives reimbursement sooner than what our former group carrier could provide.

Dentists and employees receive prompt payments.

There is an ulterior motive for reimbursing dentists immediately. With a self-insurance program, we do not have access to a data bank which would help determine if the rates charged for specific services exceed the average for an area. For reoccurring claims, references can be made back to prior records. However, when claims are extraordinary, we have to rely on the assistance of dentists with whom we regularly have contact. By phoning a few of them for a cost analysis, we are better able to determine if fees are in line. We have yet to encounter an uncooperative dentist.

Illinois Parks and Recreation 18 March/April 1985

Employee understanding

Because the park district is now administering this insurance plan, there is potential for strained employee relations if benefits do not meet expectations. Therefore, it is imperative that employees understand exactly the extent of their coverage. They should also be encouraged to obtain estimates on major work prior to receiving care. This helps eliminate any surprises.

Overall, we have found the merits of a self-insurance dental program to far outweigh the minimal amount of time required to administer it. Problems can be held to a minimum by carefully supervising claims and closely working with dentists with whom there is regular contact.

ABOUT THE AUTHOR: Rick Bemm is the executive director of the Dundee Township Park District.

Arbor Day is April 26

Governor James Thompson has proclaimed April 26 as Arbor and Bird Day in Illinois.

Statewide planting ceremonies by many citizen groups will mark Arbor Day activities. The 275 garden clubs affiliated with the Garden Club of Illinois will spearhead the observance.

In issuing his proclamation, Thompson said, "State highway rights-of-way make the Illinois Department of Transportation the largest single landowner in the State. There is no better place to fight for tree resources and wildlife habitats, struggle against pollution, provide windbreaks and stabilize watershed than on land held in trusteeship for the people of Illinois."

Arbor Day was first officially recognized in the United States in 1872 at the suggestion of J. Sterling Morton. Morton instilled his love of trees in his son, Joy, who founded the Morton Arboretum in Lisle, IL. The arboretum is an internationally known botanical landmark.

Illinois Parks and Recreation 19 March/April 1985