“We have worked very hard in an attempt to have this plan up and running by July of this year. That was our goal all along, but after a lot of work we have discovered it just cannot be done this year,” explains Association President Ralph White. “No one should look at this as a setback. Insurance is a complicated issue and it is going to take a little longer to do this right.”

Last year, with the support of the Governor and Legislature, the Association was successful in obtaining legislation and $150,000 in funding for the GIC to conduct a feasibility study for a retiree pay-all dental/vision plan. The hope, at that time, was for the study to be done and a plan established by July 1, 2001.

The Association has spent the past eight months working closely with the GIC and dental/vision consultant Boston Benefit Partners (BBP), in an attempt to construct an affordable quality dental plan for our members. A major factor in this effort is a retiree survey that was mailed to 5,000 retired GIC members last winter.

Typically, a survey of this type carries a 10-15% response rate. However, our members responded at an overwhelming 40%, providing 2,022 completed surveys for the study. Over 51% of the respondents are under age 71.

Among those responding, 77.45% indicated that they want a dental and or vision plan. Importantly, 43% said they could afford no more than $35 per month for individual coverage. Another 43% responded that the lowest premium, $35, was not affordable. In addition, 71% stated that “freedom of choice” in choosing a dentist was very important to them.

Next, BBP worked with a variety of dental insurance providers to establish hypothetical cost data. For indemnity dental and vision coverage the combined average monthly premium is $49.57 for individual and $98.31 for family coverage. When comparing the ability of members to afford the monthly premium with the hypothetical rates quoted by the insurance providers, it was obvious that more work needed to be done.

“I have to give credit to John Brouder of BBP, along with Robin Olson and Garen Corbit of the GIC. They have worked very hard on this project, kept the Association well informed, and sought our input,” says Association Legislative Liaison Shawn Duhamel. “All of the parties involved agree there is a strong need for retiree coverage. The difficulty rests with setting up a plan that will work.”

As the GIC works to develop a plan over the coming months, there are several key factors members should be aware of. Members should know that dental insurance does not operate like traditional health insurance. When a dental plan is made available, it will carry a maximum annual benefit and will not fully cover most dental procedures. Most plans have a maximum annual benefit of $1,000 per person.

This type of restriction exists in nearly every dental plan on the market today. Compared to health insurance, dental plans are relatively newcomers to the market place. In most cases, managed care has yet to infiltrate dentistry, leaving the free market to dictate price and coverage.

Further complicating matters are the strict enrollment preconditions set by dental carriers. For instance, Delta Dental requires that 40% of the eligible population of retirees/survivors enroll in their plans. Most plans will put waiting periods in place for certain procedures, because as they see it, retirees would otherwise join the plan in order to utilize services only to drop coverage upon the completion of the dental work.

“Surprisingly, we have found that the vast majority of retirees across the country do not have any dental or vision coverage. Medicare, Medicaid, and traditional health care plans do not cover most dental or vision needs,” continues Duhamel. “The plans that do exist are fairly expensive, or are heavily subsidized by the employer. Dental insurance is still viewed as a luxury in many jurisdictions.”

Where this leads the GIC as they develop the retiree plan remains to be seen. GIC Executive Director Dolores Mitchell plans to follow the directive given her by the Commission by including the retiree pay-all dental plan in the request for proposal being drafted for the active employees plan. The two plans would remain separate, with different benefit components, but would be bid together.

Due to the modest size of the active employee dental plan currently run by the GIC (approximately 8,000 nonunion enrollees), it was impossible to merge the two plans. According to BBP, rates would have risen substantially for active employees while still remaining out of reach for most retirees.

As members are aware, the state has not offered to contribute toward or subsidize the retiree dental plan. BBP has recommended that a stand-alone retiree dental plan will remain unfavorable to most retirees without a state contribution. They report that “[I]t is a simple economic fact that, in today’s dental marketplace, a voluntary retiree dental plan cannot succeed without a state subsidy.”

In a time of economic uncertainty, it is highly unlikely that the Legislature will help to fund a retiree dental plan. Additionally, the tax cut passed last year has placed current programs in jeopardy of being reduced or eliminated. If an appropriation were to pass, it would likely serve as a stabilizer in order to make the plans affordable.

In the states of Maine, New Hampshire, and New York the retiree pay-all plans have not been able to attract more than 15% of the overall retiree population. In Connecticut, where the state contributes 20%, over 60% of the retirees participate in the dental plan.

Until the GIC releases the RFI for dental carriers later this year, no further details on coverage or price will be known. It is the hope of the GIC that companies bidding for the active employees contract will also be willing to create an affordable retiree option.

“I know this is a confusing issue to which members simply want an answer. We are breaking brand new ground on this issue and creating something that typically has not been done before,” said White. “I can assure our members we are putting a lot of work into this issue with the hope that the end result will be something beneficial to most members. In the meantime, I must ask members to be patient.”