Small Business Owner’s Guide to Dental and Vision Insurance

If you’re reading this article, you might have already read our guide on how to provide medical insurance for your employees. This guide is going to break down how to provide dental and vision insurance into manageable pieces, such as why you’d provide it, the benefits of providing it, what your options are (the who, what, and how), and what all of the kinds of dental and vision insurance plans are, along with best practices and how to break down costs.

Our guide to dental and vision insurance is best for companies with 50 or fewer employees who want to provide them (or one of them) as a value-add to their employees.

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In this article, we are going to explain:

• Do I Need to Provide Dental & Vision Insurance for My Employees?
• The Benefits of Providing Additional Insurance
• What Are My Options for Providing Dental & Vision Insurance?
• What Makes a Good Dental or Vision Plan?
• How Much Will It Cost Me?
• What Do I Need to Do Next? Get a Quote
• Our Story- How did FSB Go Through This Process?

Do I Need to Provide Dental & Vision Insurance for My Employees?

The answer is no. Regardless of company size or location, you are not legally required to provide dental or vision insurance to your employees.

However, many companies who already offer medical insurance choose to offer dental and vision insurance as value add-on benefits. Since the company already has an insurance partner, such as SHOP, a PEO, or a broker, these plans should be readily accessible and affordable.

Am I Required to Pay for Dental or Vision Insurance if I Offer It?

Again, the answer is no. However, dental and vision premiums tend to be quite small (dental can be as small as $14-50/month, vision as little as $9-30/month), so if you are looking for a way to retain talent, paying for a portion of the premium or the whole premium would be a great way to do that.

The Benefits of Providing Dental & Vision Plans

Providing dental and vision insurance can provide great benefits to your employees and to you as an employer.

Why Would I Want to Provide Dental & Vision?

The top 3 benefits of providing dental & vision insurance as an employer are:

• Attracting talent: Dental & vision insurance, be it included in your benefits plan at the employer’s expense or at the employee’s, will be an exciting prospect for your top candidates.Since 2008’s recession, visits to the dentist have greatly decreased as many view this as an “optional” expense; providing this insurance would help take this burden off of your employee’s plate.
• Keeping your current talent: If your current talent’s life has changed (kids or a spouse maybe), where dental and vision are necessary and someone in the family needs this kind of insurance, you can retain good employees by providing this coverage.
• Differentiating yourself from your competition (as an employer): On the flip side, when you are recruiting new talent, you can be the employer that looks more attractive to potential employees because you offer extra benefits that other employers are not offering.

What Are My Options for Providing Dental & Vision Insurance?

Your options for providing dental & vision insurance depend on two main factors:

1. The who – who will you work with to provide dental & vision for your employees?; and
2. The what – what are the dental & vision plans you might choose to provide your employees with?

First, we will address the who aspect and tell you about the kinds of organizations that can provide your small business with dental and vision insurance plans.

Who Can Provide Dental & Vision Insurance to My Business?

Small businesses have 3 main options for a partner in providing dental or vision insurance:

1. A broker, or agent, who is a licensed insurance salesperson
2. A Professional Employer Organization (PEO), which is an outsourced service provider
3. The SHOP marketplace*, which is the government-sponsored health insurance marketplace (you can also get a SHOP-specific broker, rather than doing it on your own)

*Please note that SHOP only provides dental insurance; vision is not available yet.

Basically, whoever you chose to provide your employees with health insurance is who you should go to first for dental and vision.

What Kinds of Dental & Vision Plans are Available?

In general, most dental and vision plans are just like medical plans – they are either an HMO, which is known as a DMO with dental insurance, or a PPO. The biggest difference between a DMO and a PPO is the size of the network.

With an HMO/DMO, the network is much smaller, and you need to stay in the network in order for your insurance to cover your exams and treatment. You’ll also need a primary in-network doctor or dentist to provide referrals if you need specialist care. With a PPO, you enjoy a much larger network. You can stay in-network or see out of network doctors and dentists for a higher cost. No referrals are needed to see a specialist.

A final difference is the cost – an DMO will be cheaper than a PPO in monthly premium amount.

Some dental insurance providers appears to also do a hybrid of a DMO and PPO. It is known as a Participating Dental Network, or PDN. PDNs are similar to a PPO, but have a smaller network than a PPO with lower costs.

Types of Dental Coverage and Major Providers

In addition to being a DMO or PPO, dental coverage is typically classified as:

1. Full coverage – covers small percentage of major dental events like root canals; covers minor procedures like filling a cavity; covers annual exams/cleanings (or even every 6 months)
2. Minor coverage – partial to full coverage of minor procedures like a filling a cavity; covers annual cleanings/exams (or every 6 months); does not cover major procedures
3. Basic coverage – partial to full coverage of cleanings & exams on a pre-determined basis (annual, biannual, or smaller periods); doesn’t cover other procedures

Here are some more details on the major providers of dental insurance nationwide and what they can provide:

Major Dental Insurance Providers Nationwide

Types of Vision Coverage and Major Providers

Vision coverage is typically classified by the number of times in a year you might need to see an eye doctor for an exam, change your glasses, or change your contact lenses. Some plans are more generous, for instance, covering new glasses or contacts every year. Others may only cover eye exams or new glasses/contacts every two years.

Here are some more details on the large providers of vision insurance and what they can provide:

Major Vision Insurance Providers Nationwide

What Makes a Good Dental or Vision Plan?

Similar to a good medical insurance plan, a good dental or vision plan should be clear on:

1. What providers are covered, or what doctors are in-network?
2. What services are covered, especially preventative services like annual exams?
3. How much you will pay if something catastrophic happens, like a deductible or what procedures are not covered (e.g. major dental work)?

Customer service should be readily available to help you and your employees answer these questions, so so that you can administer the plan effectively.

Check the customer service options of your provider and see what support they offer, including live chat, email support, and a customer support line.

How Much Will It Cost to Provide Dental & Vision Insurance?

Your cost of providing dental and/or vision insurance is going to depend on two main factors:

1. The percentage of the premium you’ll pay for or the flat amount you’re willing to pay each pay period towards your employees’ dental and vision coverage
2. Who you are going to cover – Is it the just the employee, employee and spouse, employee and dependents, or full family coverage?

The Percentage of Premium or Stipend for Your Employee

You’ll need to determine how much you as the employer want to pay for regarding dental and vision premiums.

In general, dental hovers around $20-$60/month total and vision is around $10-$30/month. This is pretty affordable, both for you as the employer to cover as a benefit or for the employee to pay out of his pocket.

Employers in general choose to cover either a percentage of the premium or provide a flat amount towards the insurance premium per pay period.

Who Are You Going to Cover?

You as the business owner can choose to just cover your employees, but you may need to consider their spouses and children too (or dependents, as they are known). Due to the affordable premiums, this is one case where dependent coverage does make sense because it’s children who need more frequent dental and optometric visits, making it a great perk for your employees.

If you offer a flat amount, then this takes this off your plate – the employee can just use that flat amount for covering whatever health costs he or she wants. However, if you cover a percentage of the premium, then your cost will go up or down depending on how many people are covered, and might be affected annually as premiums rise.

What To Do Next: Get a Quote

If your business already has a broker or PEO you work with, asking them for quotes on dental and vision should be easy and they should be eager to help you expand your offerings.

If you work with SHOP, you can currently only get dental through them and you would need to find a broker to help you to get vision plans quoted.

If you don’t have anyone for medical insurance yet, then you’ll want to check out your options, which we talked about earlier in the story.

Our Story – How Did FSB Choose to Provide Dental and Vision Insurance?

Here at Fit Small Business, we were in a situation similar to yours. We wanted to provide our team with access to dental and vision insurance in order to provide a complete benefit package (since we already were ready to offer health insurance).

Since we chose to work with a PEO as a co-employer for all of our insurance needs, we had ready access to dental and vision plans. We made a decision to have our employees pay for dental and vision at their own expense since we cover the premium for health insurance. Here are our recommendations on the best PEOs for small business.

The Bottom Line

Offering dental and vision insurance can be a great value-add for your employees and can be affordable for even a small business owner like yourself. It can differentiate you as an employer and be a nice perk for your team.

Don’t forget to check out Gusto, a payroll and HR services provider that offers hundreds of benefit packages from top insurers through brokers licensed in your state. Click here for a free trial.

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