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Dental Care and America Have Come a Long Way – Happy 4th of July!

Posted by Laura McMullen on Fri, Jul 01, 2016

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Tags: Healthcare, dental

As Dental PPO Penetration Increases, Is Market Saturation Near?

Posted by Aaron Groffman on Fri, Nov 30, 2012

Our analysis of the top 15 dental PPO networks revealed another important trend: market penetration is growing, with room for more growth in the future.

Dental PPO market penetration (contracted providers as a percent of the available number of providers) continues to grow. As of March 2012, the average national PPO plan contracted with approximately 72,000 providers, representing 37.8% of available providers, up from 37.2% a year prior. By comparison, in 2008, market penetration was only 28.1%, with fewer than 50,000 providers contracted. The recent growth seems due in part to an increase in the number of networks dentists are joining.  Networks per provider increased from 5.9 in 2008 to 8.4 in March 2012.

Of course, there’s still plenty of room for growth. With nearly 120,000 providers, on average, not yet participating, we expect dental PPO market penetration to continue to increase.

 DentalPPOTrends MarketPenetration Netminder1 resized 600

Tags: dental, dental benefits, dental insurance, dental insurer, dentists, dental provider, network growth, dental PPO networks

Is Growth of Dental PPO Networks Sustainable?

Posted by Aaron Groffman on Fri, Nov 16, 2012

We recently analyzed the top 15 dental PPO networks and discovered several important trends in the dental PPO market. One of the most notable trends is that, so far, dental PPO networks continue to grow.

More dentists are contracting each year. In March 2012, the average national dental PPO network[1] contracted with more than 72,000 unique dentists, up 8.7% from the prior year. Additionally, reported access points increased 22%, much faster than the growth in unique dentists. Based on these two factors, on average, the number of locations a dentist practiced at grew from just over 2 in 2011 to 2.25 in 2012.

We’ve heard concerns that some network directories might be overstating access, so we dug deeper into the claims data provided by many of our clients.  We found that, of the average 2.25 locations per dentist that directories claim, we were able to confirm an average of 1.34 practicing locations.  A practicing location is one where there was confirmed claims activity for the dentist during the last twelve months.  As we receive more and more claims data from clients, the number of practicing locations will most likely increase.

With all this growth of dental PPO networks in recent years, we have to ask: is it sustainable?


[1] The average of the top 15 national dental PPO networks.

Tags: dental, dental benefits, dental insurance, dental insurer, dentists, dental provider, network growth

Prudential Exits Dental Benefits Market; Others to Follow?

Posted by Aaron Groffman on Wed, Oct 17, 2012

Exit dental benefits marketOver the last few years we've seen a number of new entrants into the dental benefits market.  With many options for leasing networks and outsourcing back office functions, the barriers to entry seem fairly low. So far not many carriers have exited dental. However, one of the nation’s largest insurers recently announced it is leaving the dental benefits market to focus on other products. It may be too early to tell, but this news does spark the question: Could this be the beginning of an exit trend?   

Prudential Financial Inc. announced last week that it will discontinue the sale of dental coverage and concentrate instead on its bread and butter: life and disability policies. The second-largest U.S. life insurer said its group unit, Prudential Group Insurance, will continue to service dental clients until their current contracts expire.

In recent years very few carriers have left the dental industry. But times have changed and perhaps dental is not as easy as it seems.

What do you think? Will more insurers follow Prudential’s lead and strategically eliminate supplementary lines of business to focus efforts and resources on their core products?

Tags: dental, dental benefits, dental insurance, dental insurer

Counting providers: roundtable generates interesting discussion

Posted by Aaron Groffman on Fri, Sep 21, 2012

Healthcare 

I just returned from the National Association of Dental Plans annual conference in Phoenix, AZ.  In addition to catching up on industry trends and meeting with many of our clients, I was asked to moderate a roundtable session on counting providers.  The discussion generated interesting dialogue about dental PPO network growth, provider turnover, and sub-leasing of networks.

  • Dental PPO networks continue to grow at double-digit rates year over year. Even as penetration of the dental universe passed 40%, the group didn’t see growth topping out anytime soon.  The economy is encouraging providers to keep joining networks to replace lost income from fewer cosmetic procedures.
  • Turnover is not a big issue for dental plans.  Dentists usually stick with the plan unless something major (significant loss of membership or drop in fees) happens.
  • Dentists who join networks are increasingly getting “leased out” to other plans as part of network rental arrangements.  They often end up seeing patients from plans they didn’t actually join.  I thought this might be a confusing or annoying issue for dentists, but the group felt that the dentists and their staffs were handling it well, and that it was a non-issue.

Let me know if you agree with these trends or if you’re seeing something different in your market.

Tags: Healthcare, dental, Healthcare, employee benefits

How benefits are bought has changed. Have you changed how you’re selling?

Posted by Aaron Groffman on Thu, Sep 20, 2012

Prudential’s Sixth Annual Study of Employee Benefits finds that 40% of plan sponsors say the employee benefits decision-making process has changed in the past five years, with senior management being more involved.  According to John DeLorenzo, SVP or Sales for Prudential Group Insurance, decisions are moving as high as the C-Suite. After interviewing more than 2,000 C-level executives at 500 companies during and before the recent recession, Nic Read, president and CEO of SalesLabs agrees, and thinks it will stay this way for at least four more years.

To land these higher level meetings, Read suggests identifying the gatekeepers to help get you an appointment.  But certainly “cultivate multiple points of entry, and gauge who has “more influence than authority”.  Pursue all options.  Sam Fleet of AmWINS Group Benefits advises his sales staff to “never take a ‘no’ from somebody who can’t give you a ‘yes’”.

Sales representatives need to be more consultative and work with potential clients on a health care strategy:

  • Bring solutions to problems. rather than spreadsheets.
  • Give insights that provoke ideas.
  • Advise
  • Commit the person to something at the end of the meeting that only they can do. Know what that commitment is and propose it before you walk out the door.

It’s clearly more important than ever for the sales consultant to be prepared and armed. We constantly tweak our data to deliver reports that show thought-provoking insights. I’d love to know if you’ve noticed this trend and how you’re responding to it.

Tags: Healthcare, Medical, Vision, dental, employee benefits

Exchanges Mean Insurers Must Market Directly To Consumers To Compete

Posted by Aaron Groffman on Wed, Jul 18, 2012

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The recent SCOTUS decision makes it necessary for health insurers to rethink their business models.  This is shaping up to be the most competitive era in healthcare’s history. The ability to recognize and adapt to change is key to survival.  Charles Fine from the Sloane School of Management points out, “thinking cannot be outsourced," and lots of thinking needs to be done right now.

To capitalize on the opportunity presented by ACA, the majority of insurers plan to participate in state health insurance exchanges.  Suddenly, consumers become a crucial vast market which adds a whole new dimension to how insurance companies view their business. PwC estimates health policies sold through exchanges could be worth nearly $60 billion in premium revenue by 2014 and grow to nearly $200 billion by 2019.  Marketing to consumers will change from the current employer-based B2B model to an exchange-based B2C model.

Insurers won’t find much help about how to compete looking within their own industry.  Instead they should be thinking about what companies like Amazon and Zappos and other online retailers did right to get where they are.  They must walk the tightrope between control and speed.  How will insurers reach this crucial market, what will their message strategy be to differentiate themselves from other insurers, and how will they be sure their infrastructure is in place to deliver on marketing promises made?

According to the following article from Employee Benefit Adviser, the insurers surveyed expect it will take approximately 15 months on average to get their businesses ready for exchange certification by the federal government, with 60% expecting it to take 18 months or longer.  How do you think these new challenges will affect insurers?

Providers will need to shift toward consumer-focused model post-reform - Articles - Employee Benefit Adviser.

Tags: Healthcare, Economy, Medical, Vision, dental, Medical, Healthcare

Employers reaching out directly to providers to build networks.

Posted by Aaron Groffman on Thu, Jul 12, 2012

I just read Emily Berry’s recent article in amednews about some employers attempting to manage their own provider networks. Just imagine the redundancies and inefficiencies if all employers decided to contract directly with healthcare providers.  Not to mention the time providers would spend time dealing directly with employers regarding contracts rather than treating patients.

Building and maintaining provider networks is not and will never be a core-competency for employers, and therefore should be delegated to those who do it all the time.  It would be a better use of an employer’s leverage to insist on better contracts and narrow, high-performance networks that the carrier could turn around and market to others, rather than having a “single-use” network built for an individual employer.

There is no official count of how many employers are contracting directly with providers, but industry insiders say there is certainly growing interest.  Am I wrong about this, or does this sound like an idea that may have merit in certain limited situations, but is clearly not scalable?  What are your thoughts?

Tags: Healthcare, Economy, Medical, Vision, dental, Medical, Healthcare

With a few tweaks, ObamaCare might actually work.

Posted by Aaron Groffman on Fri, Jul 06, 2012

While it received most of the attention due to the SCOTUS decision, the individual mandate is not the main problem with ObamaCare.  In fact, from an insurance perspective, having (almost) everyone in the pool is better.  The problem is when you combine the individual mandate with a required minimum benefit that's often too expensive for the new entrants.  The result is too many people opting out and paying the tax, leaving them uncovered for serious illness or injury, and keeping the rest of us on the hook to foot the bill. This clearly defeats the purpose and intention of the mandate.

I agree with Holman Jenkins' assertion in his WSJ piece "ObamaCare—Upheld and Doomed" that a reasonable tweak to make ObamaCare more successful at covering more people without bankrupting the system is to "modify the Affordable Care Act so buying any health policy authorized by the new charter, no matter how minimalist, satisfies the employer and individual mandate." Read the article and let me know if you agree.

Tags: Healthcare, Economy, Medical, Vision, dental, Medical, Healthcare

No end in sight for rising costs.

Posted by NetMinder -Ignition Group on Sat, Jun 30, 2012

 

Georgetown University Center on Education and the Workforce just came out with a comprehensive report on the state of healthcare and its impact on the healthcare workforce by 2020.  Bottom line, in spite of new legislation, there is no end in sight for rising costs. While costs are expected to increase at a slightly slower pace over the next decade, they are still predicted to amount to 20% of GDP by 2020. Because of this rapid growth, the healthcare industry has the p0tential to create 5.6 million jobs between 2010 and 2020.

Our industry clearly has many challenges. They say that every big problem is solved with small steps. Which ones should we be taking to address these predictions of costs that exceed anyplace else in the world?

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Tags: Healthcare, Economy, Medical, Vision, dental, Medical, Healthcare

 

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