The very first hurdle the vision and dental industries confronted was visibility: recognition by policymakers as significant players in the creation and implementation of healthcare reform.

Based on expenditures, vision and dental care are dwarfed by the estimated $2.5 trillion U.S. healthcare marketplace; insurance for vision and dental care together total a "mere" $50 billion a year —about $35 billion expended for dental plans plus around $12.5 billion spent on vision care plans. Those aren't the only numbers that count, though. "The vision industry insures about 119 million people and our company, VSP, has about 56 million people included in that," Rob Lynch pointed out.

"The legislative discussion was never really focused on supplemental benefits — dental and vision," said NADP's Evelyn Ireland as the roundtable discussion kicked off. "Congress was really laser-focused on medical and really didn't understand the implications of the few words that they included here and there about dental [and vision]. Except for us at this table and others that were lobbying, dental and vision probably would not have gotten any focus at all."

The roundtable panelists agreed that the ACA's inclusion of vision and dental benefits for children is, in principle, a positive step — but even with this mandate, legislators largely were oblivious to the ACA's disruptive implications for the vision and dental plan markets. A key concern is the potential for chaos created when healthcare plans are required to include vision and dental benefits for children, while the employed parents (whose standalone vision and dental policies previously covered the entire family) still need separate vision and dental coverage of their own. Panelists expressed concern that many families might drop adult vision and dental coverage altogether, especially if they find themselves paying for duplicate coverage.

"There is value to the fact that they recognize some of the preventive benefits of having [coverage] for children, so I do give Congress credit for that," said Julian Roberts of the NAVCP and NASHO. "But it is a complex market and I wonder if Congress really understood the market, the interplay of issues, and the some of the consumer aspects—particularly when it came to the impact on vision and dental benefits."

Furthermore, "the role that vision and dental have in overall wellness and chronic disease management and detection really wasn't well known, at least that's what we found when we were talking to people on Capitol Hill — especially the staffers who were involved in constructing the Affordable Care  Act," Lynch said.

The eyes have been called the windows to the soul — and increasingly, medical researchers as well as optometry and ophthalmology practitioners recognize that peering into patients' eyes reveals much more than ocular health. A key example is early detection of diabetes and circulatory system diseases.

"In a comprehensive eye exam where you actually do a dilation, it's the only part of examining the  human body where a clinician can look at the vascular system and see exactly what's going on," Lynch explained, adding that enlightened policymakers, employers, and consumers now are learning that high cholesterol, high blood pressure, and a number of other maladies "can be diagnosed or at least identified through a comprehensive eye exam."

The links between dental health and hygiene and overall wellbeing also are well-established by research and practice. However, it's the economics of these linkages among vision, dental, and overall wellbeing that have the potential to really turn the heads of policymakers (and regulators charged with implementing policy). According to Lynch, rigorous research data demonstrate a nearly 127 percent payback on comprehensive eye exams, in terms of reduced or avoided medical costs thanks to early disease detection and other beneficial outcomes.

"We found by sharing that information and showing specifically why a comprehensive exam contributes to savings on the medical side, this has gotten [policymakers] to say, OK, we really do need to take a look at this," he said.

VSP's chief of health policy, Al Schubert, cited a recently completed study that found 27 percent of vision patients presenting symptoms of chronic conditions had no separate medical spending. "So what that says is that eye doctors are doing their job by finding the chronic conditions, saving employers and the government downstream cost and improving the quality of life of these patients," he said.

Thanks to these extensive efforts to educate policymakers and the wise decision of the vision and dental plan industries to join forces, critical breakthroughs were made with legislators such as Sen. Debbie Stabenow (D-Mich.), resulting in last minute tweaks to the ACA favorable to supplemental benefits.

However, dental plans fared better than vision plans in the ACA's establishment of exchanges.

Enter the Exchanges: The Battle to Participate

Healthcare exchanges — slated for launch in 2014 — are a core provision of the ACA, intended to ensure consumer access and competitive pricing for the all healthcare coverage mandated by the law. The American Health Benefits Exchange (AHBE) will provide an individual coverage market where federal subsidies of premium are available to qualified consumers. States also must provide a separate Small Business Health Options Program (SHOP) exchange enabling employers with 100 employees or less to provide insurance to their full-time workforce.

Dental insurers can participate in the federal and state exchanges as stand-alone plans; however, thanks in part to disagreement between vision plan leaders and vision care providers (represented by the American Optometric Association and the American Academy of Ophthalmology), vision insurers are excluded as standalone plans from exchanges as the law currently stands.

"It's a little ironic that probably we're the largest health plan by covered members … yet we cannot participate directly in the exchange the way the law is currently structured," Lynch commented. This directly contradicts President Obama's oft stated promise that "if you like your doctor, you can keep your doctor," Lynch emphasized, going on to say that "even though standalone dental is included, I think you'd agree that there's still the potential for not being able to keep your coverage consistent" thanks to inclusion of vision and dental as pediatric but not adult essential benefits.

One imperfect workaround could come as HHS issues the detailed regulations that govern not only participation in the exchanges, but also whether benefits already purchased in the private market can supplant duplicate benefits that would be required of plans purchased within the exchange. If HHS gives greater latitude, employers and individual consumers can mix and match benefits in the process of complying with the ACA's mandated essential benefits (more on that shortly). NADP research, for instance, indicates that "almost 80 percent of employers intend to keep their dental benefits unless they're forced to do otherwise." (Dental and vision benefits are cost effective for employers and popular among employees — even when offered strictly as voluntary benefits.)

On the other hand, "we could have a lot of very unhappy consumers if they've got a dental policy, they've got a vision policy, it covers them, it covers their kids, and then they go to the exchange thinking they're going for medical, but they're told they have to buy medical and dental," Ireland said. "HHS has got to make some clarifications about whether this coverage that exists in the private market is going to be accepted."

However, she and other roundtable panelists were at best cautiously optimistic that HHS would make a determination favorable to vision and dental plans. And they dismissed outright the notion of any near-term legislative fixes for this or other problems in the ACA — Congress will not touch the hot potato of healthcare reform prior to November 2012 election.

But doors shut in Washington could be open in 50 state capitals.

"Where legislative activity is occurring is at the state level," said Jim Mullen from Delta Dental of California. There could be many opportunities for refinement as healthcare reform is implemented at the state level — particularly if, as anticipated, HHS regulators give broader latitude to the states to interpret and adapt the ACA's provisions.

Vision and dental plan leaders have forged common ground with the National Association of Insurance Commissioners (NAIC) — arguably the leading players in determining how SHOP exchanges and other ACA provisions take shape on the state level. "And so we were fortunate to get the NAIC to put together a model act, and we've had some provisions put in there that are very favorable to our cause," Mullen said. "It's really then following up to make sure the state is adhering to that."

At first blush, it seems daunting to move the education and lobbying effort from the nation's capital to 50 state capitals. However, Mullen emphasized the role of "what we call pace car states." Given its sheer size, his home state of California certainly is one pace car — but also perhaps an outlier. Reform pioneers such as Massachusetts also could be influential, but "if we held up a model piece of legislation at the state level, Maryland would certainly be it," he said.

"Maryland did a very good job in terms of being very definitive about the placement of dental and vision," Mullen explained. They were also definitive about the market reforms, which, of course, dental and vision are considered excepted benefits — we don't have to comply with those market reforms."

VSP and other vision plan providers will continue pursuing the goal of including standalone vision plans within exchanges — if not in the primary federal and state exchanges, then at least in secondary exchanges that they hope will be linked to primary exchanges as a way of extending their offering of benefits (potentially to include non-health benefits, such as retirement plans and life insurance). Roberts and other panelists pointed out repeatedly that standalone vision plan benefits are simpler to access and understand and therefore much more likely to be utilized by consumers.

What's Essential?

Defining the Essential Health Benefits Package

The next battle for vision and dental plans also is playing out on federal and state levels as HHS vets industry and public input, then issues regulations, many of which will then evolve into state legislation. This will continue the struggle to define what benefits actually make it into the essential health benefits package, or EHBP. These essential benefits will be mandated for all plans participating in the federal AHBE exchange and for plans offered by states that implement SHOP exchanges.

Last year, HHS Secretary Kathleen Sebelius asked the Institutes of Medicine (IOM) to weigh in with recommendations for the essential benefits package. Perhaps wisely, IOM responded in October 2011 with a set of guidelines, but not explicit recommendations, for EHBP.

"The key thing the IOM recommended was to use the typical benefit package of a small employer, not a large employer, because population you will serve is small employer and affordability is key," Ireland said in a follow-up conversation in late fall. "HHS can't include everything and make the package affordable, so regulators have to balance affordability with the demands of providers and specialty care groups. IOM also said that coverage should be evidence-based to the extent possible."

Likewise, the joint NADP/DDPA White Paper held back from making specific recommendations for essential health benefits. "Offering Dental Benefits in Health Exchanges: A Roadmap for Federal and State Policymakers" — a comprehensive white paper published in September 2011 by the two organizations — explores a range of benefit levels and their implications for cost and wellbeing, but kept its recommendations more broad:

HHS should define a core benefit level for "pediatric oral services" including the age encompassed by the term "pediatric" to create a consistent base for states to make both separate dental policies and dental services integrated with medical coverage available to consumers in Exchanges. This core or "essential" benefit for "pediatric oral services" should be affordable for consumers and administratively simple for Exchanges to administer.

Vision players clearly see their goal — optometrists, ophthalmologists, and the vision plan industry all will be back on the same page regarding essential benefits, having put aside their disagreement over participation of standalone vision plans within exchanges.

"I think we're beyond that now — we're pretty much focused on the fact that we really believe that this benefit should be a comprehensive eye exam," he explained. "If you're going to have pediatric eye care benefit in there, it should be a comprehensive eye exam. And we are in lockstep with the American Optometric Association on that."

Peering into the Crystal Ball:

What's Next for Vision and Dental Benefits?

The roundtable discussion delved repeatedly into the likelihood of various healthcare reform outcomes — the panelists' own predictions, as well as reports of other experts such as McKinsey & Company and Towers Watson. A key question — with too many variables to answer definitively — is whether or not exchanges will catch fire among consumers and employers. Another critical issue, Ireland said, is "the decision about minimal essential coverage," Ireland said. "Is everybody really going to be mandated to buy it or is the Supreme Court going to overturn that?" Lewin Group and others already are weighing in on whether the ACA can survive without the individual mandate. (Lewin says the ACA's implementation would be impacted if the mandate is struck down — but far less than many believe.)

Panelists also were concerned that the reform process preserve and extend competition rather than foster further consolidation in healthcare insurance. They feel strongly that vision and dental plans can compete favorably — on a level playing field — with medical insurance providers that lack their specialized focus and expertise.

Another key question: Could the clock be turned back on healthcare reform? The courts are filled with various legal challenges to the ACA and Republicans have been unanimous in saying they would seek to completely overturn the law if their party is victorious in the 2012 presidential and congressional elections. Panelists discussed various possibilities, but were optimistic that even if Republicans had a landslide, "saner heads would prevail" in preserving the best aspects of ACA and refining its most problematic features. Though a Republican victory in 2012 could make things interesting, panelists predicted there would be no way to turn back the tide of comprehensive healthcare reform.

Panelists indicated widespread uncertainty about the speed at which exchanges will rolled out and adopted. There are confident predictions that less than half the states even will be ready to deploy exchanges by 2014, meaning they will be reliant on the federal exchange or possibly regional exchanges involving collaboration across state lines.

"If we had the crystal ball, we'd all want to see, gosh, are the exchanges going to catch fire? Are they going to go right to 32 million [participants], are they going to go to 50 million, or are they going to go to five or seven million?" Schubert said. That, in turn, would more clearly define how reform and exchanges in particular would impact the purchasing dynamic of the overall healthcare industry.

"The industry, for the most part, plays in a group purchasing dynamic where employers are purchasing," Schubert continued. "With the exchange, you can have [our CEO] Rob going into the exchange and me as an employee of VSP saying, no, I'm not  going to do that, I'm going to take the employer-sponsored coverage. And so you have those varying push-and-pull dynamics that we're not going to know for a period of  time. [But] that could be a very significant shift in the industry just in terms of buying patterns and whether we shift ultimately from an employer purchasing dynamic to an individual purchasing dynamic."

Lynch responded by relating VSP's experience in Massachusetts, where mandatory healthcare and a state exchange have been in place for some five years.

"We were concerned. We thought maybe we'd see [a decline] in the small group market," he said. "You know what? We haven't seen any change in that marketplace for our coverage. … Our business, in fact, has continued to grow in Massachusetts."

Roberts expanded on this point by returning to the value that vision and dental benefits provide to consumers and especially to employers, who he said would continue, even in the midst of reform, to use supplemental benefits as a means of attracting and retaining employees. He predicted the trend would accelerate with an economic uptick.

"I think it's going to be an excellent opportunity for at least dental and vision and many other specialty and ancillary products out there to show to the employees that, hey, we're supporting you. We're providing you with the benefits that will encourage you to come and work for us," Roberts explained. "I think that's going to have a huge impact … as we move forward with the projections of healthcare reform."

Benefits Sellers: A Critical Role as Trusted Advisors

What does all this mean for those who sell benefits? A lot of uncertainty, of course — but also opportunity to do more of what you already do, according to roundtable panelists.

"The normal small employer is … out there focused on what their day-to-day business needs are," Roberts said. "They're going to need someone to provide them with guidance."

Indeed, in a purchasers study conducted by NADP asked employers who they would look to for advice.

"In resounding numbers, they said they were still going to look to their brokers and agents for advice," Ireland said. "The individual employers, particularly the small ones, are not going to be able to navigate on their own … to do the balancing act of 'what are my options?' … From what employers were telling us, they're not just going to mosey on over to the exchange. They're going to ask somebody they trust and have a relationship with to give them input on a decision."

Lynch concurred, while noting that compensation of benefits sellers will be an open issue. (The influential NAIC officially supports legislation to ensure commissions are taken into consideration.)

"I think it elevates the stature of benefits selling professionals, agents and brokers, in helping navigate [the landscape of reform]," he said. "In terms of how they get paid, we will have to see how that works out, but from a professional standpoint, it makes the profession even more critical as time goes on, not less."

So will healthcare reform ultimately result in good outcomes?

"In general, we think the effort around health reform is a good effort — and it was an imperfect bill," Lynch said in wrapping up the roundtable discussion. "The entire industry is trying to work within the confines of what we know today to move it forward. And, if we do get a couple of clarifications and tweaks to where things stand today, we think it could be hugely advantageous for the entire U.S. population and would not be a bad thing for the industry."

By John W. DeWitt

John W. DeWitt, an event moderator and contributing editor for

Summit Business Media and other insurance industry publications,

is principal and senior consultant for JW DeWitt Business

Communications in New Salem, Mass.

Download a PDF of this article.