Is private dental insurance worth it in Australia?

In the past 10 years, average dental insurance premium increases have been higher than the increase in general dental fees. Faced with an increasing cost of living, the question has to be asked;

Is it worth having private dental insurance in Australia?

Private dental insurance, like most insurances, is a safety net for when you need it, in the expectation of avoiding large out of pocket expenses when things go wrong.

Yet, whereas you might pay a $500 excess to get your completely smashed car restored, your dental insurance seems to work in reverse and will largely be capped at a fixed dollar or percentage value amount, and you are expected to pay the difference.

Say for example you need a dental implant, but the health fund you are with has an annual cap of $400 on dental implants. Your health fund pays $400 to your dentist. Out of pocket expenses for you could be several thousand dollars depending on the work you have had done.

Plus, some insurers offer annual limits, but cap the amount per visit that can be claimed. So you have a $300 general dental limit, but it’s limited to $55 per plaque removal and $25 per x-ray, meaning that you need to visit 4 – 6 times to get your full entitlement. But you are limited to 2 cleans per year, so you will never get your entitlement unless you need additional work done.

The dental insurance plans are relying on patients to incur regular out of pocket expenses to reap the full benefit of their entitlements.

Some insurance plans offer no-gap dentistry when you visit their own practice or a ‘preferred’ supplier. FirstBite Dental doesn’t participate in any of these arrangements, as we are constantly investing in the latest technology for our patients, and keep all staff abreast of advancements with regular training and further education. These options would not be possible by agreeing to ‘no gap’ dentistry.

Your Insurance provider should allow you to see the dentist that you want to see. A senate enquiry into health insurance in late 2017 was applauded by the ADA for recognising that,

“The Private Health Insurance Act be amended to prohibit private health funds from paying lower rebates to policyholders whose preferred healthcare provider is not in a contract arrangement with their health fund”.

The car repair industry has already outlawed this practice and we support that it should be applied to the dental industry as well. A patient should see whoever they wish to see and not be penalised for it.

You can read more about this on the ADA ebsite in their article Senate Inquiry into Private Health Insurance hands down report.

So what should you do?

Before you jump in and cancel your private cover, do a bit of homework:

  1. Identify how much of your cover is for extras. This is not straightforward as insurance providers bundle up their cover in different ways.
  2. Review your claims for the past 12 months.
    Are you claiming back more than the cost of your cover?
    How much of this is dental related?
    You can ask your insurance provider this question. “How much did I pay in premiums and how much did I get back from insurance?”.
  3. Assess your dental needs for the years ahead. Do you think that you will be claiming more based on your knowledge of your dental health?
  4. Shop around. It takes time and it is confusing, but it can make a difference to your hip pocket.
  5. Pick an insurance provider that doesn’t penalise you for wanting to see your own dentist.

Australia’s leading dental body, the Australian Dental Association (ADA) agrees that health funds are not meeting the needs of many Australian families, and are ripping off their patients. The ADA recommends that you put your money in the bank and save it for when you need it rather than paying health funds.

We tell our clients that a visit to the dentist every 6 months for a hygiene and health check is better insurance for your hip pocket. You will more than likely avoid any major work in future, plus guarantee the health of your teeth and gums.

To help you decide if private dental insurance is right for you, talk to us or take a look at these related articles:

SBS News: ‘Not value for money’: Dentists slam private health insurance

Choice: Tips to save on extras insurance

Choice: How to save on health insurance

Choice: Why your extras health cover policy is losing value

Choice: Should you get health insurance for braces?