Addressing the Affordable Care Act

Addressing the Affordable Care Act

Edward J. Vigna, D.D.S.*:
 
 
As I prepare this article for Northwest Dentistry, I realize this will be my last submission as your 10th District trustee. It has truly been my honor and privilege to serve as your trustee. Again,  I thank you for giving me this opportunity. 
 
The following is a response to House resolution 83 from the 2011 House of Delegates. 
 
Response to “Implications of the Affordable Care Act” (Res. 83H)
 
I. Background
The Affordable Care Act (ACA) has the potential to transform the U.S. health care system. However, the impact on the dental care delivery system is unclear. The ADA commissioned an  analysis of the potential impact of the ACA on dentistry, pursuant to Res. 83H1. An inter-agency staff group worked with an outside consultant to carry out the analysis. The analysis  addresses three broad questions: 
• What will be the potential impact of expanded Medicaid eligibility on the dental care delivery system?
• What will be the potential impact of the establishment of state health insurance exchanges on the dental care delivery system?
• What will be the potential impact of the growth of Accountable Care Organizations on the dental care delivery system?
 
This report summarizes the key findings from the analysis. The three full reports, including comprehensive state-by-state analyses and data, can be found in the appendices. 
 
II. Key Findings
Expanded Medicaid Eligibility
The ACA is expected to have a significant impact on the number of adults enrolled in Medicaid. The impact on children is expected to be much smaller. 
• These projections assume that all states will participate in the expansion to 133% of the federal poverty level.
• ACA is expected to add 20.8 million adult enrollees to Medicaid by 2018, an 84% increase compared to 2010. The benefits will continue to vary from state to state. 
• ACA is expected to add 3.2 million child enrollees to Medicaid, a 10% increase compared to 2010. 
Comprehensive dental benefits for children are already a required component of state Medicaid benefits. 
 
A significant share of the new Medicaid adult population will have no or very limited dental benefits. 
• Dental benefits for adults are not mandated under Medicaid. 
Thus, the impact of the Medicaid expansion on adult dental benefits will be a function of how each state’s Medicaid program covers adult dental services going forward. 
• Our analysis estimates that of the 20.8 million adults gaining Medicaid coverage, 37% will have no dental benefits, 13% will be covered for emergency care only, 20% will have limited dental  benefits, and 30% will have extensive dental benefits.
• This assumes that states will neither expand nor reduce adult Medicaid dental benefits from their current levels between now and 2018. Given the recent trend of reducing adult dental  benefits, this should be viewed as an optimistic scenario. 
A significant increase in dental Medicaid expenditure is anticipated. 
• The Medicaid expansion population is expected to generate 6.2 million new users of dental services, 10.4 million new dental visits, and $2.4 billion in additional dental expenditures per year.  This represents a 28% increase over current Medicaid dental expenditure, and a 0.6% increase in total Medicaid expenditure. 
• The above assumes the expansion Medicaid population utilizes dental services in the same pattern as today’s Medicaid population. 
• The cost associated with insuring the expansion population will be largely borne by the federal government. For the initial two expansion years, the government will fully fund the cost,  grading down to a 90% federal funding rate in 2020 and beyond. 
Overall, the increased number of potential dental patients in Medicaid will put further pressure on an already strained Medicaid dental care system. Some states may incur increased unmet  dental need as a result of Medicaid expansion. 
 
Establishment of State Health Insurance Exchanges
Among non-Medicaid children, the individual mandate is expected to have a small positive effect on the demand for dental care. 
• Pediatric oral care is part of the essential benefit package. All children must obtain dental benefits.
• The number of children with dental insurance is estimated to increase by three million, or roughly five percent, by 2018.
• States are likely to end up with a comprehensive pediatric oral care essential benefit similar to those seen in today’s commercial dental plans, even potentially including medically necessary  orthodontia. 
• Without the ability to utilize dollar annual or lifetime maximums on those services, dental plans will likely need to consider cost-reducing mechanisms such as higher deductibles, higher  coinsurance, or visit limitations to keep the benefit affordable. 
Among non-Medicaid adults, the individual mandate is expected to have a negligible effect on the demand for dental care.
• Oral care for adults is not part of the essential health benefit package. However, dental benefits will still be offered on the exchange and can be purchased voluntarily. 
• The dental benefit offerings in the exchange will likely take on characteristics different from today’s commercial plans in order to protect insurers against adverse selection. Unlike pediatric  dental benefits, cost-sharing restrictions such as annual and lifetime dollar maximums will still be allowable within adult dental benefit plans. Further, dental plans may incorporate innovative  approaches to manage cost in order to lower premiums and incentivize purchase.
• The net number of adults with dental insurance is expected to increase by 800,000. This accounts for adults purchasing insurance on the exchange, offset by adults previously insured in  the group marketplace who drop dental coverage.
• The overall rate of employer-sponsored dental insurance (ESI) is not expected to change significantly as a result of the new exchange marketplace. However, pockets of the ESI market,  including smaller employers and those with a predominantly low-wage workforce, may discontinue offering benefits and send their employees to the individual exchange to purchase insurance  coverage. 
Overall, the analysis estimates that for non-Medicaid adults and children, the ACA will lead to an additional 7.6 million dental visits, 17.4 million dental procedures, and $1.1 billion in dental  expenditure per year – a 2.1% increase in private dental expenditure and a 1.0% increase in total dental expenditure. 
 
Integration of Dental and Medical Care through ACOs
ACA reform is anticipated to expand the share of health care provided under the umbrella of accountable care organizations (ACOs). ACOs are designed to align provider incentives with  provision of quality, coordinated care rather than volume of services, and to improve the infrastructure underlying care delivery. 
 
According to the National Maternal and Child Oral Health Policy Center, dental care can be integrated with medical care within an ACO model in several different ways: 
Within today’s ACOs, dental care is not generally included as a core component. Where dental services are incorporated, it is mainly only at the level of facilitated referral or co-location. This  is due to several reasons: 
• ACOs are focused on Medicare-covered populations and Medicare does not have significant coverage for dental services.
• ACOs are focused on integrating their core medical services, particularly high-cost, high-risk procedures that have potential cost savings. Dental care is usually not viewed as a core  service. 
• There may be a perception that dental providers are outside the mainstream of medicine and that they have no need for health plan or ACO arrangements to stay financially stable. 
• Dental providers and dental benefit plans today do not mesh with an ACO’s evidence-based care approach. Most dental providers and plans are accustomed to providing care according to  frequency limits defined by dental insurance policies rather than a patient’s dental risk profile. 
 
Looking forward, as ACOs mature it is uncertain how rapidly dental care will be integrated, if at all. Key factors affecting this include: 
• Pediatric dental care is part of the essential benefits package, but not adult dental care. As a result, ACOs are likely to focus their attention on the basket of health care services that must  be provided. 
• For states where Medicaid provides dental benefits to adults, there may be interest in integrating dental providers into the ACO structure to better serve the Medicare/Medicaid dualeligible population. 
• Medicaid-focused ACOs may be interested in integrating dental providers into the ACO structure for pediatric dental care.
 
III. Next Step:
Appropriate agencies within the ADA will review the findings of the three analyses of the impact of the Affordable Care Act on dentistry and recommend appropriate action, including the  development of a strategic approach based on the analyses that will be used to guide ADA’s advocacy and activities and provide assistance to constituent societies.  
 
 
 
*Dr. Vigna is the Trustee to the Tenth District of the American Dental Association, representing Iowa, Minnesota, Nebraska, North Dakota, and South Dakota.