DENTAL INSURANCE

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP81-00261R000700020005-2
• Release Decision: RIPPUB
• Original Classification: K
• Document Page Count: 3
• Document Creation Date: November 16, 2016
• Document Release Date: March 7, 2000
• Sequence Number: 5
• Publication Date: November 9, 1978
• Content Type: MF

Approved For Relea 2000/05/16 : CIA-RDP81-0026UW00700020005-2
NOV
MEMORANDUM FOR: Chairman, ADMAG
FROM F. W. M. Janney
Director of Personnel
1. This is in response to your memorandum concerning the
feasibility of a Government Employees Health Association (GEHA)
dental plan.
2. As you may recall, GEHA offered dental insurance to
its members from 1963 to 1966. This dental insurance was
operated as a separate plan, independent of GEHA's Association
Benefit Plan (ABP) of health insurance. In its first year of
operation, the dental plan suffered financial losses primarily
because those employees who had immediate dental needs joined
the plan and those who did not ignored the plan.. It was appar-
ently a case of "adverse selection." Despite these losses, the
underwriter of the dental plan agreed to continue it for another
year, expecting that those employees who did not join the plan
before would be attracted to it because of the benefits paid
to the first year participants. On the contrary, however, the
increase in enrollment the second year resulted in increased
losses. With claims at 138% of premium, the underwriter can-
celled further operation of the plan. The plan could have been
a success if it had enjoyed enrollment by a major portion of the
Agency population - but allowing :participation by only those
who knew they would receive more in benefits than they would pay
in premium resulted in financial failure. The success of many
dental plans lies in the fact that they cover (and therefore
receive premium for) all of those eligible, as for example,
when a company pays for the dental coverage of all of its
employees as a result of a union negotiated fringe benefit.
3. The only way that we could produce the broad partici-
pation necessary in order to insure success of our own dental
plan would be to add the dental benefits to our own health
insurance plan. Ignoring for the moment the problems this would
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 Approved For Release' 2000/05/16 : CIA-RDP81-002648000700020005-2
create (e. g., personnel under cover would be forced into this
dental coverage whether they wanted it or not) we have explored
the possibility of a modest addition of dental coverage with
the U. S. Civil Service Commission with whom we must contract
annually. We learned from the Commission that for 1979, and
perhaps beyond, both the Commission and the Office of Management
and Budget preclude Federal Employees Health Benefit Program
benefit improvements (such as the addition of a dental plan)
which would require an increase in the government contribution
to a plan's premium. The Commission's Bureau of Retirement,
Insurance and Occupational Health further advised that the
projected expense of a conservative family dental plan (excluding
orthodontic) would add $10 $12 biweekly to the health insurance
premium.
4. GEHA's Association Benefit Plan does provide dental
benefits limited to dental services and treatment (including
initial replacement of natural teeth and dental x-rays) for re-
pair of accidental injury to the jaw or sound natural teeth.
Also covered is the removal of impacted teeth. These benefits
compare favorably with other major Federal health insurance
plans available to employees under the Federal Employees Health
Benefits Program. There are three federal employee health plans
(Aetna, Postmasters Benefit and Mailhandlers Benefit Plans) which
offer some additional dental benefits but their limitations and
special provisions should be carefully read and viewed in context
with the entire benefit structure of the plan.
h
l
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5. I am
are
oyees s
sure that many emp
interest in a
dental insurance plan but because of the signifi-
cant
impact on
premiums and the current restrictions on adding
such
benefits to a Federal Employees Health Benefits Program
plan,
it does not appear that GEHA can add a dental plan in the
near
future. This matter will, however, again be reviewed by
GEHA
during the 1979 contract year.
6. Your suggestion that an employee bulletin be issued on
this subject is a good one. The substance of this memorandum
will be issued as a bulletin in the near future.
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^ UNCLASSIFIED C INTERNAL COP'" IDENTIAL ^ SECRET'
`
ROUTING AND RECORD SHEET
SUBJECT: (Optional)
Dental Insurance
FROM: F. W. M. Janney
Director of Personnel
EXTENSION
NO.
~"_
5 E 58, Ha.
6825
DATE
TO: (Officer designation, room number, and
building)
DATE
OFFICIER'S
COMMENTS (Number each comment to show from whom
25X1 A
RECEIVED
FORWARDED
INITIALS
to whom. Draw a line across column after each comment.)
Chairman, ADMAG
o Office of Communi
zation
s
2. 3 B 14G,
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3.
4~ #-/ 07 )a
4.
5.
10.
12.
13.
14.
15.
FORM 61 0 USE PREVIOUS SECRET CONFIDENTIAL. INTERNAL UNCLASSIFIED
3-62 EDITIONS ^ ^ ^ USE ONLY ^
Approved For Release 2000/05/16 : CIA-RDP81-00261 R000700020005-2