Extracting the true cost of universal dental care

Something to chew on: why do governments spend less on dental services? illuminaut

The recent decision to means test the tax subsidy on private health insurance was made on the grounds that we provide more help to those who need it most and not subsidise those who can afford to take care of themselves.

At the same time, some of the savings from this decision have been set aside to fund public dental care - again on the grounds that this will assist those with the greatest dental health problems who are perceived as being unable to afford private dental care.

We have a poor comparative record of adult oral health in Australia: we are ranked 18th among 21 OECD countries in overall caries. One quarter of Australians have untreated decay, this figure rising to almost 60% in the indigenous population.

One in four Australian adults visits a dentist less than once a year, usually for a dental problem rather than prevention. There is substantial inequality in oral health outcomes: the percentage of middle-aged adults with inadequate dentition was seven times higher in the lowest (12.4%) than the highest (1.7%) income quartile.

For over thirty years, we have funded a universal system of health care that provides free specialist hospital care and free or heavily subsidised GP and pharmaceutical services. Yet we spend far less public money on dental care than other health services. Of the $6.7 billion spent by individuals on dental care in 2008-2009, government paid around 20% of these costs, compared to around 80% of hospital and medical costs.

Over 80% of dental care is provided by private dentists, paid for by patients - some of whom are covered by private insurance. The poorest do not receive adequate, timely care, with substantial waiting times for adult general dental care in the public sector - 17 months in Victoria in 2011, for example - with over 46% of health-care cardholders and the uninsured reporting that they avoided or delayed a visit because of the cost. While very few people in the highest income quartile have no natural teeth, over 17% in the lowest income group have none.

So what is different about dental health that it is not provided through public clinics or covered by a universal health care scheme?

It does seem arbitrary to consider disease in the mouth as different from disease in any other part of the body, especially as poor dental health is associated with chronic diseases that have substantial costs to the health system, such as cardiovascular disease and diabetes. Yet Australia is by no means unique among comparable countries, where almost none have a universal dental health scheme. In part, it may be due to the relative status of the profession internationally, but perhaps more likely it is due to a perception that dental health is not the same as overall health and, unlike health care, does not require insurance or deserve a public subsidy for most of the population.


The argument is that unlike most illnesses, dental health is both predictable and a more direct result of personal behaviour. As such, there is no need for the public to pay for the results of personal failures in preventive health. This line of thinking leaves the only arguments for public subsidy as: there are those who are not responsible for their dental health (children) or through no fault of their own cannot afford prevention or treatment (the “deserving” poor); and some treatments are not predictable or preventable.

This reasoning results in the current system, where over 90% of dental care is purchased privately by patients and the residual public dental care is provided to health-care cardholders through state-run public dental schemes.

Four questions arise: is current funding for public dental care adequate to meet the needs of those who can’t afford care; are the arguments for funding dental care differently from general health care reasonable; what level of means testing is acceptable; and is it efficient to have a universal coverage of health care or to cordon off those aspects of care that are predictable or avoidable?

What will it cost?

Part of the resistance to universal coverage for dental care is the cost. There is no consensus on what such a scheme would cost because it is not clear what would be covered. Most estimates of the cost envisage that it would cover only preventive and restorative services (not bridges and crowns, for example). The National Health and Hospital Reform Commission estimated a total cost of $5.2 billion per annum, with additional government expenditure of $3.9 billion per annum from universal subsidy of 85% for adults at current fee levels. This is about equivalent to the cost of the subsidy to private insurance provided by the tax rebate.

This is probably an overestimate as it is calculated by assuming that lower income people and those without insurance would consume the same level of services as those who currently do have insurance. It is true that 43% of non-insured people delay or avoid dental care, but it is not clear that a public subsidy would lead them all to get the same level of treatment as those who have insurance. Another issue is the uncertainty on how the scheme will be designed to deal with the market response of dentists to the increase in demand.

It would be possible to have a more targeted scheme - focused on prevention of disease - that would cost much less. Indeed, the expansion of the states’ public dental scheme bargained for by the Greens suggests an alternative way of providing better access to a wider range of dental care.

There are strong efficiency reasons for a universal scheme with coverage of services that are rational and evidence-based in terms of net benefits, rather than arbitrary cut-offs for cover (whether they are financial, age or co-morbidity related) that are not clinically relevant. The wider the group, the less effort needs to be placed on criteria for testing for eligibility - and consequently the support and political durability of the scheme will be stronger.

Barriers to a national scheme

Apart from the perceived financial burden to governments with a fetish for budget surplus and the real opportunity cost of that money to other priorities in health care and the economy as a whole, the other barrier is dentists. They may be unwilling to take part if the fees are insufficient to reward them for additional work or to persuade them to work in a new environment. The supply of dentists is a long-term problem of training, although it is worth noting that dentists appear, on average, to work less than 35 hours per week. Short-term expansion may be possible at least in the private sector with the right incentives.

Can we afford a national scheme?

In some ways, this is the wrong question. As a wealthy nation with a national health scheme, we can afford to pay for universal dental coverage if we choose to do so. Whether we choose to pay for this is really about how much we are willing to give up consumption through taxation or other areas of public expenditure in return for improved access to dental care and ultimately an improvement in health for those we choose to help.