The provincial dental associations plan every year to create a suggested dental fee guide on what they recommend dentists charge for regular work – and this year’s fee guide adjustment is looking to be the highest increase in years.
- Ontario – 8.5%
- Quebec – 9.8%
- Manitoba – 5.25%
- PEI – 5.77%
- Saskatchewan – 5.62%
- Alberta – 6.0%.
What’s alarming here is that Ontario’s fees have risen by 8.50% compared to past increases of 4.75% in 2022, 4.60% in 2021, 1.27% in 2020, and 4.19% in 2019. That’s a significant bump over the last few years, and both dental patients and practitioners are feeling the pressure.
Why are dental fees going up?
Short version? Many contributing factors go into this spike in dental fees, and there isn’t a one-size-fits-all approach for every clinic.
- Delayed procedures from COVID: Employees/patients are heading back to the dentist to get work done that has been put off for a long time during COVID because there wasn’t a company plan to help.
- Inflation rates increasing: The pandemic has dramatically altered the fee guides due to pent-up, higher costs incurred over the last few years and the recent spike in the inflation rate.
- Increases in dental use: Dental trends are showing that more patients are coming back more often for procedures and check-ups while also staying for longer, which contributes to driving the costs up.
- Labour, materials, and overhead expenses: The cumulative overhead costs that many clinics face go into the service fee increase.
The ODA’s Suggested Fee Guide is also driving this.
The key word here is “suggested.” The Ontario Dental Association (ODA) Fee Guide is a benchmark for dentists and dental coverage providers to use these recommended fees to establish their dental procedures and services. Insurance companies will also use this framework to help determine the appropriate reimbursement levels for dental care provided to employees. This annual guide is designed to help set fair fees for the industry for various routine dental services.
There are a number of circumstances that influence dental fees. Everything from the clinic’s location to specialized equipment to the complexity of the procedure to onboarding/hiring new staff goes into the new rate guide.
Plan sponsors need to absorb more of the healthcare costs
“The effect of higher health care prices on plan costs will be phased in over the next few years as contracts come up for renewal and providers negotiate higher reimbursement levels.”
The cost-increase forecast focuses on healthcare affordability for plan sponsors this year. Meaning that raising deductibles or co-pays won’t bode well for employees who are seeing historically high inflation rates decimate their earning power. If plan sponsors increase these rates, patients may face higher out-of-pocket dental costs. Struggling to deal with widespread labor shortages, many employers must remain competitive by prioritizing an attractive benefits plan that absorbs more healthcare cost increases.
Cost containment and cost transparency are the new trends
“Today, employers realize ‘total cost transparency’ and holding the provider accountable are also essential” for lowering benefits expenses.”
– Heidi Cottle, head of cost-containment strategies at NFP.
According to a 2022 US Benefits Trend Report, when considering cost containment, roughly three-quarters of employers believe that each of the following are important factors:
- Increasing employee access to quality providers (83 percent).
- Making costs more transparent (79 percent).
- Reducing out-of-pocket expenses for drug costs (79 percent).
While many employers are not planning to increase employees’ share of dental coverage costs in 2023, it shows that rising healthcare premium costs are a pressing issue in the labour market and could be a deciding factor when attracting and retaining new talent. For a look back at last year’s dental fee guide and the outlook for 2023, read our blog on the steady (and alarming) increase in dental fees.