2002 Annual Report of the Dental Care Plan Board of Management (NJC Component)

Health Plans

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 Component) during the period of January 1 to December 31, 2002.

INDEX

General Statement

Membership and Activities

Administration

Table 1

Table 2

Dental Care Plan

Communication

Training

Conclusion

GENERAL STATEMENT

The Dental Care Plan Board of Management (NJC Component) is pleased to present this report for the period of January 1, 2002, to December 31, 2002.

The Dental Care Plan completed 15 years of operation on March 1, 2002. 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 Treasury Board, the Employer.

The Dental Care Plan Board of Management (NJC Component) 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.

MEMBERSHIP AND ACTIVITIES

The Board of Management met four times during 2002, devoting its time to overseeing the administration and financial status of the Plan, resolving appeal cases and recommending improvements to the Plan. The Board reviewed 47 appeals; 19 were upheld, 25 were denied and the Board sought additional information in three cases.

It was with great sadness that the Board learned of the death on December 11, 2002 of Marie-Paule Scott, Chairperson of the NJC Dental Care Plan Board of Management at the time. The Board recognizes Marie-Paule's energy and passion and her contributions to the National Joint Council.  She will be truly missed.

Ms Adèle Lacroix and Lynn Malette, NJC Committee Advisors, served as Secretary on behalf of Mr. Dan Butler, General Secretary of the NJC.

The members of the Board as of the end of the 2002 reporting period are:

ADMINISTRATION

The Board of Management is satisfied that Great-West Life, 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 unions.

The Board noted that the Administrator maintained a claim turn-around time of under five days for routine claims.

The total cost of the Dental Care Plan (NJC Component) since 1998 is as follows:

• 1998 - $ 45.5 M
• 1999 - $ 47.5 M
• 2000 - $ 51.3 M
• 2001 - $ 55.0 M
• 2002 - $ 63.3 M

The total cost of $63.3 M for year 2002 includes $ 58.8 M or 92.9% for paid claims and $ 4.5 M or 7.1% for expenses. The increases in costs over the previous year were 15.1% compared to 7.2% in 2001, 8.0% in 2000 and 4.4% in 1999.

The principal reasons for the increase in Plan costs are the:

• increased number of members covered;
• increase in fee schedules;
• higher claim costs per member.

The number of covered employees increased during year 2002 by 4,492 or 4.4% from 101,747 at the beginning of year, to 106,239 at the end of the year.  A total of 87,067 employees (average of 82%) submitted at least one claim, either for themselves or an eligible dependant.

A total of 490,549 claims were resolved, representing an increase of 9.8% from 2001; the average cost per claim increased by 4.9% to $119.93; and the average benefit per member went up from $511.86 to $553.74, an increase of 8.2%.

Table 1

BREAKDOWN OF CLAIMS/RÉPARTITION DES RÉCLAMATIONS Plan Number 55555 - NJC/Numéro du Régime 55555 - CNM 5 year Claims Resolved Analysis/Analyse des réclamations réglées sur une période de 5 ans
YEAR/ ANNÉE	ROUTINE/ ORDINAIRES		MAJOR/ EXTRAORDINAIRE		ORTHO		TOTAL
	AMOUNT/ SOMME	%	AMOUNT/ SOMME	%	AMOUNT/ SOMME	%	AMOUNT/ SOMME
1998	31,484,157	73.9%	6,641,904	15.6%	4,501,733	10.5%	42,627,794
1999	32,758,448	74.1%	6,699,529	15.2%	4,744,814	10.7%	44,202,791
2000	35,431,022	74.2%	7,301,761	15.3%	5,008,159	10.5%	47,740,942
2001	38,032,210	74.5%	7,607,804	14.9%	5,429,040	10.6%	51,069,054
2002	44,238,576	75.2%	8,629,277	14.7%	5,961,305	10.1%	58,829,158

Since 1998, the Plan's costs have risen steadily. The increase appears to be due to an aging population that requires more dental services, and a younger labour force joining the Dental Care Plan.

In general, variations between years 1998 and 2002, concerning paid claims by type of treatment, are as follows:

Table 2

Comparative Table of Paid Claims by Type of Treatment for years 1998 to 2002 (percentage) /Tableau comparatif des réclamations acquittées par type de traitement pour les années 1999 à 2002 (en pourcentage)
Treatment/ Traitement	1998	1999	2000	2001	2002
Major Restorative/ Restaurations majeures	10.15	9.94	10.20	9.89	10.14
Minor Restorative/ Restaurations mineures	22.23	22.26	22.13	21.87	22.01
Oral Surgery/ Chirurgie buccale	4.33	4.39	4.27	4.42	4.48
Orthodontic/ Orthodontie	10.55	10.73	10.49	10.58	10.14
Periodontic/ Paradontie	14.50	15.10	15.86	16.47	17.76
Preventive/ Prévention	15.45	15.20	14.57	14.51	12.75
Adjunctive/ Soins complémentaires	1.20	1.04	1.12	1.05	1.12
Reline Rebase/ Rebasages	0.13	0.10	0.11	0.10	0.08
Dentures/ Prothèses	2.25	2.04	1.95	1.88	1.70
Diagnostics/ Diagnostic	9.66	9.68	9.68	9.79	10.78
Endodontics/ Endodontie	6.20	6.36	6.49	6.23	6.22
Fixed Bridge/ Ponts fixes	3.35	3.16	3.13	3.21	2.82
Total	100	100	100	100	100

The above table shows that the percentages have remained relatively stable for most services, with a few exceptions, over the past five years.

Periodontal services have continued to rise, climbing from 14.50% in 1998 to 17.76% in 2002.  As this increase seems to signal a tendency, the Board will ontinue to monitor the situation over the next year.

The chart found below represents the average amount paid by the Administrator to employees in 2002.  The age groups 40-44, 45-49 and 50-54 form the bulk of the amount paid last year.

DENTAL CARE PLAN

In December 2002, an agreement was reached between the Treasury Board and the Bargaining Agent Side of the National Joint Council on changes to the Public Service Dental Care Plan effective January 1, 2002 until December 31, 2003.

The maximum reimbursement amount for a calendar year per covered person for eligible dental expenses (excluding orthodontic services) increased from $1,300 to $1,400.

COMMUNICATION

At the same time as the announcement of changes to the Dental Care Plan, a series of practical reminders concerning the terms of the Plan were published on the NJC and the TBS web sites.

TRAINING

The Board recognized the importance of training for its members. Consequently, it covered the registration fees for the participation of members in educational or professional development activities.  In particular, members of the Board attended conferences organized by the International Foundation of Employee Benefit Plans.

CONCLUSION

In closing, the Dental Care Plan Board of Management (NJC Component) wishes to take this opportunity to thank the Administrator's representatives, Peter Foley and Vida Kudzma, for their ongoing commitment and contribution to the successful administration of the Plan in year 2002.

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