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One Way to Use Your Tax Refund Wisely: Buy a Dental Insurance Plan

One Way to Use Your Tax Refund Wisely: Buy a Dental Insurance Plan

Posted Apr 18, 2016 by Jenifer Dorsey

If you received a federal tax refund this year, you are among the nearly 8 in 10 U.S. tax filers who received one.[1] So, what’s the best way to spend it? On car repairs or a much-needed vacation? As a deposit in your savings account or as an extra student loan or credit card payment?

The answer depends entirely on you, of course. However, we would like to suggest one smart way to use some or all of your tax refund (for the record, in recent years, the average tax refund has been $2,800)[2]: Buy a dental insurance plan.

It may not seem like the most exciting way to use your refund, but it could help you save money on dental care this year.

Average dental expense amounts vs average dental insurance plan costs

On average, the annual dental expense for Americans younger than age 65 is $683—this includes children.[3] For adults 65 and older, the average annual dental expense is $833.[4] For preventive care alone, Americans paid an average of $370 out of pocket for two exams and cleanings and a full set of X-rays in 2011.[5]

In comparison, the average (i.e., dental insurance premium) cost for individual and family dental insurance plans through healthedeals.com is around $30 per month, which is about $360 per year.[6] It has been about seven years since the National Association of Dental Plans collected national data for estimated average monthly and annual dental premiums—the 2009 data shows that individual and family dental insurance premiums ranging from $4 to $15 and $20 to $35, an annual average of $48 to $180 for individuals and $240 to $420 for families.[7]

Why buy dental insurance?

Obamacare may not require you to have dental coverage, but dental coverage can help your oral health as well as your household’s bottom line.

In addition to potential savings on dental visits, dental insurance can make you more likely to visit the dentist in the first place. Studies show that Americans are more likely to seek dental services when they have dental benefits.[8]

If you have healthy teeth and gums, preventive dental exams and cleanings can help you keep them that way.[9],[10] And, maintaining good oral health could mean you spend less on dental services such as fillings and root canals. Because dental benefits are largely related to preventive care, many dental plans cover two annual exams and cleanings at or near 100 percent—some even cover a set of X-rays and pediatric sealants at or near 100 percent as well.

Dental plans vary, but generally include several options to meet your budgetary and oral care needs. In addition to plan premiums, copay and coinsurance amounts, preventive care benefits, networks, and waiting periods, look for plans that have additional discounts for services you may use (e.g., vision care and orthodontia).

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[1] Sahadi, Jeanne. “Nearly 8 Out of 10 U.S. Taxpayers Get Refunds.” CNN Money. Jan. 15, 2015. http://money.cnn.com/2015/01/13/pf/taxes/taxpayer-refunds/

[2] Ibid.

[3] Agency for Healthcare Research and Quality. Dental Services-Mean and Median Expenses per Person with Expense and Distribution of Expenses by Source of Payment: United States, 2013. Medical Expenditure Panel Survey Household Component Data. Generated interactively. Accessed on April 14, 2016.

[4] Ibid.

[5] American Dental Association. “2011 Survey of Dental Fees.” December 2011. http://www.ada.org/~/media/ADA/Science%20and%20Research/HPI/Files/11_sdf.ashx

[6] Numbers based on IHC Specialty Benefits dental insurance plan data for all plans.

[7] National Association of Dental Plans. “What Do Dental Benefits Cost on a Group Basis or If I Buy Them Directly as an Individual.” http://www.nadp.org/Dental_Benefits_Basics/Dental_BB_7.aspx

[8] Bloom, Barbara, et al. “Dental Insurance for Persons Under Age 65 Years with Private Health Insurance: United States, 2008.” NCHS Data Brief. No. 40. June 2010. http://www.cdc.gov/nchs/data/databriefs/db40.pdf

[9] American Dental Association. “Decay.” http://www.mouthhealthy.org/en/az-topics/d/decay

[10] American Dental Association. “Gum Disease.” http://www.mouthhealthy.org/en/az-topics/g/gum-disease

This document is for general informational purposes only. While we have attempted to provide current and accurate information, this information is provided "as is" and we makes no representations or warranties regarding its accuracy or completeness. The information provided should not be construed as legal or tax advice or as a recommendation of any kind. External users should seek professional advice from their own attorneys and tax and benefit plan advisers with respect to their individual circumstances and needs.


About The IHC Group
The IHC Group is an organization of insurance carriers and marketing and administrative affiliates that has been providing life, health, disability, medical stop-loss and specialty insurance solutions to groups and individuals for over 30 years. Members of The IHC Group include Independence Holding Company (NYSE:IHC), American Independence Corp. (NASDAQ: AMIC), Standard Security Life Insurance Company of New York, Madison National Life Insurance Company, Inc. and Independence American Insurance Company. Each insurance carrier in The IHC Group has a financial strength rating of A- (Excellent) from A.M. Best Company, Inc., a widely recognized rating agency that rates insurance companies on their relative financial strength and ability to meet policyholder obligations. (An A++ rating from A.M. Best is its highest rating.) For more information about The IHC Group, visit www.ihcgroup.com.

“IHC” and “The IHC Group” are the brand names for plans, products and services provided by one or more of the subsidiaries and affiliate member companies of The IHC Group (“IHC Entities”). Plans, products and services are solely and only provided by one or more IHC Entities specified on the plan, product or service contract, not The IHC Group. Not all plans, products and services are available in each state.

About IHC Specialty Benefits, Inc.
IHC Specialty Benefits, doing business as Health eDeals Insurance Solutions is a full-service marketing and distribution company that focuses on small employer, individual and consumer products. Health eDeals markets products through general agents online, telebrokerage, advisor centers, private label, and directly to consumers on