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Public Policy Options for Better Dental Health: Report of a Study (1980)

Chapter: Benefit Priorities and Their Estimated Costs

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Suggested Citation:"Benefit Priorities and Their Estimated Costs." Institute of Medicine. 1980. Public Policy Options for Better Dental Health: Report of a Study. Washington, DC: The National Academies Press. doi: 10.17226/9921.
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Suggested Citation:"Benefit Priorities and Their Estimated Costs." Institute of Medicine. 1980. Public Policy Options for Better Dental Health: Report of a Study. Washington, DC: The National Academies Press. doi: 10.17226/9921.
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Suggested Citation:"Benefit Priorities and Their Estimated Costs." Institute of Medicine. 1980. Public Policy Options for Better Dental Health: Report of a Study. Washington, DC: The National Academies Press. doi: 10.17226/9921.
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Suggested Citation:"Benefit Priorities and Their Estimated Costs." Institute of Medicine. 1980. Public Policy Options for Better Dental Health: Report of a Study. Washington, DC: The National Academies Press. doi: 10.17226/9921.
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Suggested Citation:"Benefit Priorities and Their Estimated Costs." Institute of Medicine. 1980. Public Policy Options for Better Dental Health: Report of a Study. Washington, DC: The National Academies Press. doi: 10.17226/9921.
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Suggested Citation:"Benefit Priorities and Their Estimated Costs." Institute of Medicine. 1980. Public Policy Options for Better Dental Health: Report of a Study. Washington, DC: The National Academies Press. doi: 10.17226/9921.
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Suggested Citation:"Benefit Priorities and Their Estimated Costs." Institute of Medicine. 1980. Public Policy Options for Better Dental Health: Report of a Study. Washington, DC: The National Academies Press. doi: 10.17226/9921.
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Suggested Citation:"Benefit Priorities and Their Estimated Costs." Institute of Medicine. 1980. Public Policy Options for Better Dental Health: Report of a Study. Washington, DC: The National Academies Press. doi: 10.17226/9921.
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Suggested Citation:"Benefit Priorities and Their Estimated Costs." Institute of Medicine. 1980. Public Policy Options for Better Dental Health: Report of a Study. Washington, DC: The National Academies Press. doi: 10.17226/9921.
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Suggested Citation:"Benefit Priorities and Their Estimated Costs." Institute of Medicine. 1980. Public Policy Options for Better Dental Health: Report of a Study. Washington, DC: The National Academies Press. doi: 10.17226/9921.
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Suggested Citation:"Benefit Priorities and Their Estimated Costs." Institute of Medicine. 1980. Public Policy Options for Better Dental Health: Report of a Study. Washington, DC: The National Academies Press. doi: 10.17226/9921.
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Suggested Citation:"Benefit Priorities and Their Estimated Costs." Institute of Medicine. 1980. Public Policy Options for Better Dental Health: Report of a Study. Washington, DC: The National Academies Press. doi: 10.17226/9921.
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Suggested Citation:"Benefit Priorities and Their Estimated Costs." Institute of Medicine. 1980. Public Policy Options for Better Dental Health: Report of a Study. Washington, DC: The National Academies Press. doi: 10.17226/9921.
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Suggested Citation:"Benefit Priorities and Their Estimated Costs." Institute of Medicine. 1980. Public Policy Options for Better Dental Health: Report of a Study. Washington, DC: The National Academies Press. doi: 10.17226/9921.
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Suggested Citation:"Benefit Priorities and Their Estimated Costs." Institute of Medicine. 1980. Public Policy Options for Better Dental Health: Report of a Study. Washington, DC: The National Academies Press. doi: 10.17226/9921.
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Below is the uncorrected machine-read text of this chapter, intended to provide our own search engines and external engines with highly rich, chapter-representative searchable text of each book. Because it is UNCORRECTED material, please consider the following text as a useful but insufficient proxy for the authoritative book pages.

Chapter 6 BENEFIT PRIORITIES AND THEIR ESTIMATED COSTS Estimating expenditures for dental services under a national health insurance proposal is difficult in the current political and economic climate. Also, projecting such expenditures is hampered by the in- adequacies that attend projecting costs of any national program and the inaccuracies that usually accompany initial estimates for new health programs. These problems notwithstanding, estimates of expenditures are required if there is to be a thorough national policy debate on the feasibility of dental benefits. This chapter presents the rationale and methods used by the com- mittee to obtain cost estimates for the four benefit plans outlined in Chapter 1. To provide a broader view of potential dental care expendi- tures, the estimates are compared with projections of current expendi- tures and with estimates based on actuarial data. The four priorities of benefit plans are explained here in more detail and assigned estimated costs by procedure. The estimates of their costs are developed from national population-based measures of clinical needs for dental services, and are not the demand-based esti- mates commonly made from actuarial data on private dental insurance plans. The determination of the population's treatment needs was made by examiners who would not benefit directly from decisions to recommend the delivery of expensive high technology services rather than preventive and conservative treatment. The data to facilitate financially unbiased estimates of national dental needs were collected in the 1971-74 Realth and Nutrition Examination Survey and have been discussed earlier in this report. Plan Priorities for Coverage of Dental Care Priority One has as its goal the reduction of the incidence and prevalence of dental disease in later life by instituting coverage of preventive services for children and adolescents. Preventive services for children reduce caries, although the degree to which caries are reduced is not completely clear when services are delivered with limited frequency. 93

Priority Two emphasizes comprehensive services for children. There is need for treatment of decayed teeth in children, and much of it represents a backlog of neglect. Continued neglect of decayed teeth would lead to premature tooth loss. Orthodontic care in Priority Two has been limited to services for the five percent of adolescents who have seriously handicapping malocclusions. Lessened handicap could improve not only physical health, but also emotional well-being for adolescents to whom self-image is particularly important. Priority Three provides preventive services for adults 18 years and over. For young adults below the age of about 35, prevention is mainly directed at reducing the incidence of caries. It has been shown that the benefits of preventive services for children carry over to younger adults. The major question about the effectiveness of prevention for adults is the degree to which preventive services reduce periodontal diseases. The evidence is not clear. The clinical research mentioned in Chapter 3 strongly suggests that prevention will reduce periodontal diseases. However, there are few population-based studies to document reductions in periodontal diseases after preventive services are introduced. The optimal frequency of services required for presenting and controlling periodontal diseases is currently thought to vary for different individuals. Priority Four would provide diagnosis and treatment for adults. A major issue in treatment for decayed teeth in adults is the extent to which crowns are the treatment of choice. Crowns are very ex- pensive, and their routine use could lead to large national expendi- tures if patients were treated according to current demand. The choice of this plan would represent a priority for making National Health Insurance dental benefits available to older members of the population and would thus include replacement (prosthetic) services for adults. There is considerable need for full dentures, per tia1 dentures, and bridges, particularly among the elderly population. For the U.S. population as a whole, 10 percent of adults are estimated to need upper and/or lower dentures, and 6 percent need full dentures. Restricting consideration to adults with no teeth, almost one quarter of them need full dentures. Slightly more than one-third of edentulous adults have no dentures, defective dentures or at least one absent or defective denture. These figures demon- strate a substantial need, largely among the elderly who have limited resources and opportunities to seek appropriate care. Re- placement services, particularly for the elderly, improve their quality of life, nutrition, and self-esteem. However, the cost of a full set of dentures can vary greatly. At the present time, the fee for a complete set of full dentures, both upper and lower, in a private dental office is estimated at $660. But dentures also can be obtained for about $360 ($180 for an upper and $180 for a lower). The situation for bridges, also included in the replace- 94

ment package in Priority Four, is similar to that for crowns. Costs would rise sharply if services were delivered according to current demand. A Model for Projecting Expenditures A need-based model for projecting expenditures has been developed for estimating the costs of various components of a comprehensive dental plan for national health insurance. Figure 1 shows the seven sets of variables used to project the total costs of each component. Need-based cost estimates of projected health care expenditures can only be made when there are valid and reliable measures of the national need for services available. In most instances such data are not obtainable for medical care. But for dental services, speci- fic needs can be determined objectively. To project expenditures, the national estimates of dental treatment needs were translated into expenditures for each of the four coverage plans. Expenditures are based on fees charged in private dental offices. For FY 1980 an attempt is made to compare the projected expenditures based on needs with expenditures expected if the current financing mechanisms continue. Alternative projections based on the demand experience of the California Dental Service also are presented to help assess the validity of the estimates based on needs. All expenditures are presented in dollars for the year to which they refer. Inflation of dental fees for 1981-84 is taken to be the (geometric) mean of the inflation rates observed or projected for the period 1975-1980. Benefits and coverage are defined in detail by the services included under each of the four plans. The national data that make it possible to calculate the cost of meeting the population's dental treatment needs have been gathered in the Health and Nutrition Examination Survey (HANES) of the National Center for Health Statistics conducted during 1971-74. 378/ This survey documents dental treatment needs based on dental examinations for a sample of about 20,000 persons selected according to random sampling procedures. Each survey response is weighted so that, in aggregate, the sample reflects the U.S. population of noninsti- tutionalized individuals aged less than 75. A summary of estimates of U.S. dental treatment needs based on HANES is presented in Chapter 2, Table 1. The treatment needs for each benefit for each age group of interest in the U.S. have been estimated using HANES where available. In addition, more specific RANKS data, such as measures of total number of teeth to be extracted, were used. The projected U.S. civilian population by age for each of the years 1980-84 379/ has been calculated and used in these cost estimates. 95

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In the case of needed restorations, the HANES survey may under- estimate these needs, because there were no radiographs used in the dental examinations. Based on studies of examinations performed with and without dental radiographs, an adjustment of the HANES estimate of number of teeth to be filled resulted in an average increase of 36 percent. The services estimated to be required by the entire U.S. popu- lation were multiplied by the projected median price for each service. Prices largely were the fees in private dentists' offices reported in a 1975 survey by the American Dental Association 380/ and were inflated to give projected 1980 fees. The inflation rate was based on the Consigner Price Index (CPI) for dental services compiled by the Bureau of Labor Statistics. Thus, ADA median fees reported for 1975 were inflated by 47.3 percent to obtain a projected FY 1980 fees in terms of 1980 dollars. These fees are the prices indicated in the four dental plans computed in Table 39. For the Fiscal Years 1981, 1982, 1983, and 1984, expenditures are projected in terms of current dollars under the assumption of an annual inflation rate of 8 percent in dental fees from 1980 onwards. The (geometric) mean in- flation rate for dental fees during the period 1974-1979 was 8 percent. An overhead that includes costs of administering the dental compo- nent of any national scheme and monies needed to ensure the quality of services rendered must be built into projected National Health Insurance costs. The California Dental Service Denti-Cal (Title XIX) program, which covers approximately 2.8 million persons, has an ad- ministrative cost of 6 percent 381/. According to Delta Plans Associa- tion this figure is below the usual administrative cost experienced by conventional insurance companies for dental programs 382/. But these data suggest that an administrative cost of 6 percent is realistic for an efficient organization. For a national program, one might ex- pect further economies due to the large scale of operation. On the other hand, the extent of the quality assurance mechanisms in a national program have not been defined; an elaborate system to prevent the over- utilization of dental services would be costly. Allowing for a moderately expensive quality assurance system, and assuming that a national program may not be able to achieve optimal efficiency in its administration, an administrative and quality control overhead of 10 percent seems reasonable. A review of private health insurance plans 383/ lists operating expenses as percent of premium income for private health organizations in 1976. Operating expenses and profits ranged from 5.0 percent to 46 percent of premimum income. For all private plans, the average figure was 12.8 percent. Excluding the category "individual policies" with an operating expense of 46 percent as being out of line with the other categories, the overall figure for operating expenses becomes 9.7 percent. An overhead of 10 percent rather than 6 percent was assumed to allow for unexpected contingencies and for additional quality control mechanisms. .— 97

Table 39. DENTAL CARE SERVICES AND PROJECTED UNIT COSTS BY PRIORITY PLAN FY 1980 , , Pr iority Plan and Services Amount PRIORITY ONE - Prevention services for children and adolescents a) Screening, prophylaxis (age 12-17 only), and fluoride application as appropriate b) Health education/plaque control c) Sealants: 4 per child at ages 6 and 12 PRIORITY TWO - Comprehensive services ( excluding prevention) for children and adolescents from birth to 17 years, and orthodontic services for those with a seriously. handicapping malocclusion a ) Examination b) Radiographs Ages less than 7 years: 2 per year Age s 7-11 years: 4 per year Ages 12-17 years: 1 complete set every 3 yrears c) Space Maintainers d ) Extrac Lions e) Restorations Pr imary tee th 1 surface 2 surfaces 3 or more surfaces Permanent teeth 1 surface 2 surfaces 3 or more surfaces f ) Crowns 98 $21.38 7.37 34.99 8.35 8.84 11.78 29.46 68.74 17.68 14.73 22.10 30.93 14.73 23.57 34.62 51.56

TABLE 3 9 . ( continued ) Endodontic treatmen t Pulp capping, vital pulpotomy, and root canal therapy h) Treating handicapping malocclusions Diagnosis and treatment planning Initial appliances, fixed plus 18 months treatment PRIORITY THREE - Prevention services for adults a) Screening examination and prophylaxis PRIORITY FOUR - Comprehensive services ( excluding prevention) for adult s a ) Examination b) Radiographs 1 complete set every 3 years c) Extractions d ) Periodontal treatment Gingival curettage/quadrant Periodontal scaling and root planing ( entire mouth) Per lad ontal Burger y/ quad ran t Restorations 1 sur face 2 surfaces 3 or more surfaces Crowns g ) Endodontic treatment Pulp capping, vital pulpotomy, and root canal therapy h) Replacement services (bridges and dentures) Full d en Lures Upper arch - low cost Lower arch - low cost Partial dentures (including six months post-delivery care) Br idge s Repair denture ( full or partial) Rel ine denture ( f ull or par tial ) 123.25 73.65 1, 502.46 19.15 8.35 29.46 20.62 29.46 58.92 11t) .48 14.73 23.57 34.62 226.21 123.25 209.95 209.95 368.25 773.33 28.24 91.33 ~9

Expenditures derived under the need-based method would project the amounts required to alleviate the entire need for the specified services. In practice, not all members of the population needing services would utilize them even if they were available, and so specific utilization rates were assumed. Further, not all patients utilizing services would have all their needs met; there would not be 100 percent completion of services. The utilization rate and completion rate can be combined to form an overall rate, commonly referred to as the utili- zation rate. An adjustment for completion of services could contemplate 45 percent for adults and 55 percent for children regarding all services except full dentures and orthodontics), the rates experienced by the California Dental Service. For full dentures, a utilization rate of 97.4 percent is assumed for the projected expenditures. Although this rate is high, it appears to be the experience of England and Wales under the National Health Service 384/, and is supported by data from the Health Insurance Plan of Greater New York 385/. A utilization rate of 60 percent was assumed for orthodontic care of handicapping malocclusions. Although no evidence was available to justify the choice of any particular figure, the committee as a whole judged 60 percent to be reasonable. If other utilization rates are found more appropriate, the expenditures projected under the assumptions stated above should be adjusted to reflect alternative choices. Figure 1 and Table 39, respectively, summarize the model and costs per service used to compute expenditures. In Table 40, expenditures for each plan are projected for each of the years 1980-84. The utilization rates for the various services are assumed constant throughout the five years. However, needs may change as services are rendered. The need for preventive services for children and adolescents (Priority One) are assumed to remain constant, as are needs for comprehensive care for children (Priority Two) and for adults (Priority Four). Preventive services should reduce needs for comprehensive services in successive years, but the impact of increased prevention is not likely to be felt in the short term. Further, the impact will be dissipated if utilization rates are low, such as 45 to 55 percent, and reduction in need for comprehensive services may not be realized without behavioral changes on the part of the covered population. Some of the services in Priorities Two and Four cover a backlog of unmet needs that will not recur. However, with a fairly low utilization rate, the backlog may never disappear, in which case a reduction in expenditures because of fewer unmet needs might be overly optimistic. Further, incidence rates for dental con- ditions needing treatment may change in unknown ways as prevalence changes. 100

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For orthodontic care in Priority Two, it is assumed that only children with a seriously handicapping malocclusion are eligible. The usual time for this treatment is at about twelve years of age, although the treatment might occasionally be made available at a younger age. Making this benefit available at a younger age would not change the aggregate cost projection. If the program were phased in during the first three years, children aged 11-17 in 1980 will receive needed care in 1980, 1981, or 1982, twelve-year aids becoming eligible in 1981 and 11-year-olds in 1982. The total need for the 11-17 age group, multiplied by 60 percent as a realistic utilization rate, is costed out and spread over the three fiscal years 1980, 1981, and 1982. For FY 1983 and FY 1984, expenditures are projected respectively for 10- year-olds (in 1980, becoming 13 in 1983) and 9-year olds (in 1980, becoming 13 in 1984), again assuming a 60 percent utilization rate. Thus, the steady state is reached in FY 1983 and expenditures for sub- sequent years would stay constant except for inflation and changes in the size of entering cohorts. For each year, projected expenditures include the entire course of orthodontic treatment. Replacement services in Priority Four would, in the first year, satisfy only part of the current need. For full dentures, it is assumed that current need could be met over a five-year period. During 1980-84, some new persons not currently needing full dentures would become needy, but to offset this some persons needing services would die, because the people most needing these services are elderly. The projected expenditures for full dentures do not necessarily correspond to the steady-state situation that would ulimately develop. Approximate calculations suggest future steady-state costs may be quite close (except for inflation and changes in population size of age cohorts) to the projected 1980-84 yearly expenditures. The remaining replacement services in Priority Four, partial dentures and bridges, were projected somewhat differently, separate expenditures being derived for incidence of new needs and backlog of unmet needs. Analysis of numbers of teeth needing to be replaced by partials and bridges for successive age cohorts in the HANES data (see Appendix II, Priority Four Incidence Calculations) allowed approximate estimates to be derived for the yearly incidence of new needs for partial dentures and bridges. Expenditures for treating these new needs were derived assuming estimated incidence rates applied to the projected population for each of the years 1980-84, and that the utilization rate would be 45 percent. The backlog was taken to be needs by the 1980 population, as predicted by BANES. Further, it was assumed that only 45 percent of the backlog would be treated as a result of the prevailing utilization rate. The backlog was then spread evenly over the five years 1980-84 and expenditures estimated accordingly. 102

Projected Expenditures for Four Dental Plans A summary of the projected expenditures for dentists' services based on a delivery system that is responsive to total population needs is given in Table 40 for each plan for each FY 1980-84. Table 41 gives detailed projections, for each covered benefit, of expenditures during FY 1980. All figures are in millions of dollars inflated to represent the actual buying power of the dollar for the appropriate year. The FY 1980 expenditures for dentists' services for the aggregate of all four plans is projected to be $20.3 billion dollars. The pro- jected expenditures assume that service delivery would be in private dentists' offices under the fee-for-service mechanism. Other delivery mechanisms are possible in some cases. One is the delivery of preventive care to children in a school-based program by salaried dental hygienists as recommended in Chapter 1. The services in Priority One, which involve screening and prophylaxis (including fluoride application, plaque control, and dental health education) could be delivered by dental hygienists who travel to schools routinely. On the basis of one visit per child per year of school age (6-17 years), the operating expenditures in FY 1980 for Priority One excluding emergency costs would be about 0.18 billion dollars. For two visits per year, operating expenditures would double to approximately $.36 billion. These expenditures do not include costs for capital equipment during start-up. A school-based program offers substantial savings compared with the $670 million dollars projected for services delivered in dentists' private offices under a fee for service mechanism. However, a school program would have to be phased in slowly, perhaps over a period as long as seven years. It is estimated that nearly 8,000 dental hygienists would be required to staff a national program of one visit per year to each participating child. A feasible plan could begin with pilot programs in communities already fluoridated and build up to national coverage. At the 1980 rate of dental hygiene graduates, there would be no need for an increase in auxiliary education programs. Dental Expenditures Now and in a Future National Program Estimates of total national health expenditures are reported annually by the Health Care Financing Administration (previously by the Social Security Administration). Dentists' services in FY 1977 are estimated at $11.65 billion, but no itemization of these expenditures by types of dental care is published. However, recent estimates of percent of total charges by general practitioners that correspond to specific types of dental services are available from a study by Nash, et al. 386/. Charges for each of the categories--diagnosis, prevention, operative removable prosthetics, fixed prostethics, surgery, periodontics, endo- dontics, and orthodontics--were estimated and the estimates adjusted for charges made by specialists. These adjusted estimates were applied to the expenditures for dentists' services for FY 1980, projected under lQ3

the assumption that there is no change in the present system, and that growth in expenditures to FY 1980 is similar to the pattern for the years FY 1975 to FY 1977. The itemization of services used by Nash, et al. 387/ was related to specific services in the four priority plans. A direct comparison of expenditures for dentists' services during FY 1980 between the current system and a system under national health insurance is given in Table - ~ this table appropriately as the 41. Care must be taken to Interpret two columns of projected expenditures relate to different case mixes. The first column presents total expenditures for dentists' services in FY 1980 under the current utilization system. The second column gives a hypothetical distributor of expenditures in which services iden- tified in the four plans are delivered according to population needs. Table 41. PROJECTED EXPENDITURES FOR DENTISTS' SERVICES UNDER CURRENT DENTAL CARE SYSTEMS COMPARED WITH EXPENDITURES UNDER NATIONAL HEALTH INSURANCE FY, 1980 Under Current Systems ( in millions ) Cover ed by t he Fo ur Plans When Delivery is Based on Need in millions ~ Total* $17~677 $20~011 Diagno si s 1 ~ 503 1~952 Prevention 1, 250 2,359 Operative 4,465 3,831 Removable Prosthetics 1,523 2,638 Fixed Prosthetics 5,445 4,084 Surgery 1, 057 1,411 Periodontics 347 2,801 Endodontics 1,148 345 Orthodontics 938 591 *May not add due to rounding The pro jected expenditures under National Health Insurance do not account for all expenditures that would occur for dentists ~ services . 104

Orthodontics under the current system includes services delivered in cases where the malocclusion is not severely handicapping. Under National Health Insurance, expenditures for orthodontics are solely for seriously handicapping malocclusions. Full dentures were included at a low-cost estimate in the projections for National Health Insurance expenditures and thus the figure of $2,638 million for removable prosthetics is not based on the same unit price as the figure of $1,523 million for projected expenditures under the current system. Expenditure: Demand v. Need-based Projections Table 42 is a comparison of FY 1980 projected expenditures based on need and projections based on the demand experience of the California Dental Service (CDS). These latter projections were prepared indepen- dently by the staff of CDS and were determined by the demand experience of 195,000 employees, 140,000 employee spouses, and 200,000 children of employees. California dental fees were used in the calculation, but fee differentials among states were taken into account when projecting to national expenditures. The demand rates observed by CDS were applied to the projected 1979 civilian population of the United States. To obtain FY 1980 expenditure projections, the CDS estimates were increased by an additional 8.9 percent to account for inflation, and population-specific items are different in some cases. Priority Four shows particularly divergent projections. The difference is due mainly to the large discrepancy in expenditures for crowns. CDS projections reflect a much greater proportion of crowns as the treatment of choice rather than amalgam restorations. This suggests that expenditures for crowns could escalate sharply in a national program unless reimbursement for them was restricted. Expenditures for Priority Four also show differences for indi- vidual services. Bridges result in a greater total in the CDS projections, as might be expected from the CDS bias toward crowns. For dentures, the need-based estimate is somewhat higher. It would have been much higher if the same fees had been used as for CDS projections. Only low-cost prices were used for full dentures in the case of projections based on needs. The CDS projection for dentures is likely to be low because of the population served: workers and their families. The elderly are under-represented, although they have the greatest denture needs. As previously men- tioned, the HANES data do not include persons over 74 years old, and thus even the need-based projections of expenditures may be low. Finally, the demand-based projections for Priority Four excludes the estimated amount of $1.1 billion for periodontal surgery. To permit a valid comparison of the two sets of estimates, the demand-based projections for Priority Four and the totals have been increased by this amount. A national health insurance program may alter demand and thus invalidate projections based on observed demand. However, need- 105

based pro jections rely heavily on assumed utilization rates ( taken to be 45 percent for adults and 55 percent for children), and thus any changes in these rates may change projected expenditures sharply. In any event, the greater of the two projections for individual services may give an upper limit for anticipated expenditures for dental services under national health insurance, although the need- based estimates would appear to provide a valid basis for comparing expenditures projected by other methods. Table 42. EXPENDITURES FOR DENTISTS' SERVICES BASED ON NEED AND DEMAND, FY 1980 Need-based Demand-based Priority Plan Projections Projections . (in millions) Comprehensive Dental Benefits--Total $20,011 Priority One--Prevention for Children 702 $22,945 1/ 955 Priority Two--Comprehensive Services for Children 3,398 2,090 Services, excluding orthodontics 2,807 Orthodontics for seriously handicapping malocclusion 591 Priority Three--Prevention for Adults 1,643 Priority Four--Comprehensive Services 14,268 for Adults 1,703 387 2,497 17,431 1/ Crowns 1,682 4,987 All other services 7,603 7,344 1/ Bridges 2,345 3,312 Partial and full dentures 2,638 1,788 _/ To permit a valid comparison, Priority One and Priority Four and total figures for the demand-based projections are raised by $28 million and $1.1 billion, respectively, the amount estimated for sealants and periodontal surgery included in the need-based projections. 106

Summary and Conclusions A model was developed for projecting expenditures for a compre- hensive dental plan under national health insurance. This model was based on dental treatment needs identified in the National Health and Nutrition Examination Survey (HANES) conducted by the National Center for Health Statistics during 1971-74. Expenditures are based on fees charged in private dental offices and projected to 1980. Alternative projections also were developed based on the demand ex- perience of the California Dental Service. Estimated expenditures for dental services in 1980 under the current dental delivery system amount to $17.7 billion. Projected expenditures for the proposed four priority plans using the need-based approach amounted to a total of $20 billion. Priority One, prevention for child- ren and adolescents, was estimated at almost three quarters of a billion dollars. Comprehensive services for children and adolescents amounted to $3.4 billion. Priority Three, which covers prevention for adults 18 years and over, is estimated at $1.6 billion. The most costly part of the comprehensive proposed program is Priority Four, comprehensive ser- vices for adults, estimated at $14.3 billion. Based on the demand experience of the California Dental Service Corporation, projections of total expenditures of the four plans amount to almost $23 billion. The committee felt that the range of $20 billion to $23 billion is a reasonable measure of the costs of a comprehensive plan for dental benefits. The highest priority given to preventive services is justified not only by their impact on controlling dental disease but also by their relatively low costs. Crowns and bridges are two of the higher technology services for which the expenditures for current demand appear to be significantly greater than estimates based on need. This imbalance results in their lower priority for introduction, raises a need for reimbursement systems that can contain costs, and suggests the importance of sound mechanisms of quality and utilization review. 107

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