A positive change for California's exchange

By the CDHP team

This guest blog post was co-authored by senior officials at three California-based organizations advocating for children, families and consumers. The co-authors are: Kathleen Hamilton, Director of Sacramento Governmental Affairs at The Children's Partnership; Julie Silas, Senior Attorney at Consumers Union (West Coast Office); and Eileen Espejo, Director of Media & Health Policy at Children Now.

Last fall, when California opened its state insurance exchange (Covered California), the only way families could secure dental coverage for their children was to make a separate purchase of a stand-alone dental plan.  There was no “embedded plan” — a plan they could purchase that included all 10 essential health benefits: medical, children’s vision and children’s dental benefits.

Because children’s dental coverage is among the Affordable Care Act’s “essential health benefits,” we felt it was problematic not to build this benefit into all the plans offered in Covered California. Just recently, Covered California agreed with us and voted to offer embedded plans starting in 2015.

This is very good news for California families for many reasons:

  • Offering the children’s dental benefit in embedded plans will make health plans more affordable for families by counting this benefit in the federal tax credit calculations. Staff of Covered California reported that without children’s dental embedded in plans, Californians were “foregoing an estimated $8.6 million to $21.2 million tax credit dollars per year.”
  • Embedded plans help to spread the cost for children’s dental coverage across the broader population. This is the same approach applied to children’s vision services and all other essential health benefits. Analysis shows that embedding children’s dental only slightly increases the cost of each Qualified Health Plan (QHP). Offering only stand-alone children’s dental coverage substantially increased the total costs for families buying both medical and dental coverage.
  • Embedded plans ensure that all eligible children will receive dental coverage. Having to take the extra step to purchase a separate dental policy, and pay the extra cost, reduces the likelihood of families getting coverage. In fact, our state’s experience so far bears this out: currently, only 27% of children enrolled in Covered California also had a children’s dental plan purchased for them. By offering embedded plans, 100% of enrolled children will have access to dental coverage.
  • Embedded plans reflect the intent of the Affordable Care Act. Under both state and federal law, children’s dental is an essential benefit, not a supplemental or incidental benefit. It only makes sense that it be offered as part of a comprehensive package of benefits.
  • Finally, offering embedded plans secures the competitive position of Marketplace issuers. Currently, California plans in the outside market are required to cover all 10 essential health benefits, including children's dental. Yet Covered California plans don’t cover children’s dental. Requiring policies with embedded children’s dental benefits puts all plans on an equal playing field and will help ensure all families purchasing plans — inside and outside the Marketplaces — have access to all 10 of the ACA required benefits.

The recent decision by Covered California also brings good news for adults. Although adult dental benefits are not classified by the ACA as “essential” benefits, Covered California expects to offer stand-alone dental plans for adults starting in 2015, so long as those plans include children’s dental benefits as well. If issuers step up to the plate, Covered California could soon provide an important new coverage option.

As details are worked out, our organizations will continue to monitor implementation of this significant shift in policy — and we welcome the opportunity to share our experience in California with other states.

Here is the document we submitted to Covered California, requesting this change. It includes a list of the diverse California consumer, health, and children’s organizations that co-signed this request.

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Did you know?

75% }
of American Indian/Alaskan Native children have experienced caries by age 5.
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