January 1 to December 31, 2016

In accordance with the NJC By-Laws, the undersigned submit this annual report regarding the performance and the management of the Dental Care Plan (NJC Part) during the period of January 1 to December 31, 2016.

Chairperson of the Board of Management

Peter Cooney

Employer Side Members

Hilary Flett, Health Canada
Christine Haapanen, Treasury Board Secretariat
Hélène Nadeau, Citizenship and Immigration Canada
Sean Ross, Treasury Board Secretariat

Bargaining Agent Side Members

Paul Cameron, International Brotherhood of Electrical Workers
Joy Thomson, Canadian Merchant Service Guild
Dejan Toncic, Professional Institute of the Public Service of Canada
Claude Vézina, Canadian Association of Professional Employees

General Statement

The Dental Care Plan Board of Management (NJC Part) is pleased to present this report for the period of January 1 to December 31, 2016. The Dental Care Plan completed 29 years of operation on March 1, 2016. The Plan covers reasonable and customary dental treatment necessary to prevent or correct dental disease or defect provided the treatment is consistent with generally accepted dental practices.

The Dental Care Plan is private and its cost is fully paid by the Treasury Board of Canada, the Employer.

The Dental Care Plan Board of Management (NJC Part) is composed of management and union representatives. It is responsible for the overall administration of the Plan, balancing the overall needs of the members within the allocated funding, resolving members’ complaints regarding eligibility or claims disputes, monitoring the claims settlement performance of the Administrator, and recommending changes to the Plan.

The Board met five times during 2016, devoting it’s time to overseeing the administration and financial status of the Plan, resolving appeal cases and recommending improvements to the Plan.

Administration

The Board is satisfied that Great-West Life (GWL), the Administrator, adjudicated and paid claims in accordance with the Plan Document, which has been agreed to by the Treasury Board and the participating Public Service Bargaining Agents.

The Board noted that the Administrator maintained a claim turn-around time of less than five calendar days for all claims.

Activities

The number of appeals fluctuates from year to year. In 2016, the Board reviewed 42 appeals; 11 were upheld, 30 were denied, 1 was denied, but overpayment reimbursement not asked for. The Board granted 2 requests for coverage of a dependant. The Board had reviewed 44 appeals in 2015, 57 appeals in 2014, 45 appeals in 2013, 36 appeals in 2012, 29 appeals in 2011, and 25 appeals in 2010.

The total cost of the Dental Care Plan (NJC Part) since 2010 is as follows:

Between 2010 and 2012, the Plan’s costs rose steadily. In 2013 and 2014, the plan costs decreased by 2.4% and 0.1% respectively mainly due to decrease in membership which was partially offset by an increase in the provincial fee guides and utilization of services. In 2015, the Plan’s costs increased by 1.6%, which continued in 2016 with a rise of 2.8%. These growths were due to increases in the number of services per claimant and in the average amount per service. The administration expenses increased proportionately in relation to the number of claims processed and the taxes increased in relation to the value of paid claims and administration expenses.

The total cost of $119.38M for 2016 includes $111.38M or 93.3% for paid claims and $8.00M or 6.7% for expenses.

Year to year increases are:

The number of covered employees at the end of 2016 was 125,439, of which a total of 116,636 employees (89.0%) submitted at least one claim, either for themselves or an eligible dependant.

A total of 732,170 claims were resolved, representing an increase of 1.7% from 2015; the average cost per claim in 2016 increased by 1.1% to $152.12. The average benefit per member in 2016 increased from $875.58 (in 2015) to $887.92, an increase of 1.4%.

The total amount charged by dentists to Plan members was $211,146,335 compared to $111,379,587[1] in net benefits paid to employees, for a reimbursement ratio of 52.7% (see Table 1).

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[1] Amount does not include the exchange portion of claims in US dollars.

Table 1

Breakdown of Paid Claims
Plan Number 55555 - NJC
5 year Claims Processed Analysis

Year

Routine
$

%

Major
$

%

Ortho Amount
$

%

Total Amount
$

2012

87,618,900

79.9

12,478,405

11.4

9,554,849

8.7

106,652,154

2013

86,717,836

80.9

10,914,414 

10.2

9,498,926

8.9

107,131,176

2014

87,184,702

81.5

10,206,576

9.5

9,621,980

9.0

107,013,258

2015

88,538,137

81.7

10,348,265

9.5

9,497,837

8.8

108,384,239

2016

91,014,337

81.7

10,211,167

9.2

10,154,083

9.1

111,379,587


Variations between years 2012 and 2016, concerning paid claims by type of treatment, are as follows:

Table 2

Treatment

 2012
%

2013
%

2014
%

2015
%

2016
%

Major Restorative

 7.86

 7.07

  6.53

  6.67

  6.44

Minor Restorative

21.39 

21.42

21.36

21.39

21.36

Oral Surgery

 5.21

 5.10

  5.02

  4.87

 4.90

Orthodontic

 8.71

 8.87

  8.99

  8.76

 9.12

Periodontic

23.18

23.83

24.20

24.43

24.53

Preventive

11.96

12.36

12.50

12.50

12.50

Adjunctive

 1.38

  1.33

  1.36

  1.32

  1.31

Reline Rebase

 0.03

  0.03

  0.03

  0.03

  0.02

Dentures

 0.82

  0.73

  0.72

  0.67

 0.60

Diagnostic

12.30

12.55

12.92

13.32

13.49

Endodontic

  4.49

  4.32

  4.08

  3.83

  3.60

Fixed Bridges

  2.67

  2.39 

  2.29

  2.21

  2.13

Total

100

100

100

100

100


Table 2 shows that the percentages have remained relatively stable for most services over the past five years.

Periodontal services and Diagnostic services have continued to rise, reaching 24.53% and 13.49% respectively of the total amount paid for dental services in 2016. As of 2012, Endodontics, Fixed Bridges, and Dentures, continued to decrease and represent the following percentage of overall services: 3.60%, 2.13% and 0.60% respectively in 2016.

In 2016 the age groups 40‑44, 45‑49, 50‑54 and 55-59 have the highest amount paid per employee. The change in the average paid amount from 2015 varied between 2.3% and 4.9% in many age groups. There was however, a negative change in the 55-59 and 60-64 age groups, where the average paid amount decreased by 1.8% and 3.0% respectively.

In all categories, there has been an increase in the average paid amount from 2013 to 2016 with the greatest increase in the 25-29 and 30-34 age categories at 3.0% and 3.9% (compounded annually), respectively. Furthermore, the average amount paid for Endodontics and Crowns decreased in all age categories with Crowns decreasing between $0.84 and $6.63 depending on the age category. There was a continued increase in the amount paid for Periodontics in all age categories with average increases between $19.46 and $27.01 for members between ages 35 and 59.

Overall, compared to 2013, the Plan showed a compound average cost increase per employee in all age bands. The Plan cost increase per employee from 2013 to 2016 was mainly attributable to the fee guide increase and a utilization increase in the number of services claimed. Demographics had a minimal effect on the cost of the Plan.

In 2016, the cost per employee increased by 1.4% compared to 2015 based on membership as of December 31, 2016. This increase was attributable to an increase in the number of services per claimant and an increase in the average amount paid per service even though there was a decrease in the number of claimants per covered employee.

Total costs for the Dental Care plan (NJC Part) in 2016 increased by 2.8% driven by the increased costs per employee as well as a membership increase of 1.3%.

Review of performance of the level of service provided to the Plan members:

Throughout the year, the Board continues to monitor the performance of the Plan and the level of service provided to the Plan members. For 2016, the performance was as follows (note: the call centre performance is based on the results for the dedicated line only):

 

Targets

Results

Calls answered in 30 seconds or less


70%


92.02%

Wait time for calls

30 seconds or less

11 seconds

Claims turnaround time

7 calendar days

2.82 calendar days

Abandon rate

5% of total calls or less

0.47% of total calls


Currently, there are 145,955 (40.8%) Public Service Dental Care Plan members registered for member portal access, 58,044 (39.8%) of these being NJC members. Of those registered for member portal access, 80,159 members (54.9%), (33,648 are NJC members) have elected for direct deposit. In 2016, 75.5% of total claims resolved were submitted electronically (78.1% NJC members).

Table 4 denotes the Plan’s operating expenses for 2016. Expenses have increased by 2.8% over 2015, with the majority of the increase as a result of taxes (3.0%).

Table 4

Public Service Dental Care Plan
Operating Expenses
55555 PSDCP (NJC)
January 1 - December 31, 2016

  2016 2015
  $ % $ %
Claims Settlement Expense 3,000,556.90 37.5097 2,928,680.30 37.6307
Taxes 4,998,558.78 62.4865 4,853,706.52 62.3654
Other 300.00   0.0038 300.00  0.0039
Total Expenses 7,999,415.68 100         7,782,686.82 100        


Training

When possible, the Board of Management regularly participates in conferences and learning sessions held by the International Foundation of Employee Benefit Plans (IFEBP) as a means to develop Board member expertise and to stay current with trends in the dental care field. Investment in Board member development will continue as an on-going priority.

Communication

The Administrator periodically presented usage statistics to the Board.

Conclusion

In closing, the Board wishes to take this opportunity to thank the Administrator,
Great-West Life for their contribution to the successful administration of the Plan in the year 2016.

The Board is pleased to oversee and provide advice on the management of this important employee benefit.