'It could create this very weird misalignment where employers assume employees are covered, cancel the benefit, and now the employee's left with nothing' says CEO of dental plan rollout
When the federal government launched the Canada Dental Care Plan (CDCP) last year, it was hailed as a win for public health. But its limited scope and confusing rules have continuously left employers and workers alike scrambling for answers.
Andrew Ostro is hoping to solve some of these answers for plan sponsors. While he believes the CDCP is a well-intentioned step in the right direction, he emphasized that dental care should be treated like other publicly funded health services.
“In theory, it’s the right thing to do. The objective of the plan is great but I think the rollout and the way it's been designed is very poor and isn't really accomplishing what it's set out to do,” said Ostro, CEO and co-founder of PolicyMe, a Toronto-based tech-forward insurance company.
“There are some people who will benefit greatly from this. I suspect most people will not and will get hurt by this. It's very important that everyone understands their situation carefully. Employers shouldn’t rush to cancel plans.”
Ostro pointed to a few flaws that render the Canada Dental Care Plan “sub optimal,” with eligibility being his primary concern. Although the plan is technically available to households earning under $90,000, he argues that its real value diminishes significantly once income exceeds $70,000, due to escalating co-pays.
“Between 70 and 80 [thousand], you have a 40 per cent co-pay, and above that, you have 60 per cent,” he said. “At those levels, it doesn't do a whole lot. You’re getting 40 per cent or 60 per cent of something that already is under-covered.”
He also takes issue with how the income threshold excludes many working-class families.
“That's $35,000 in pre-tax income per person,” he noted. “If you have a household of two hard-working individuals who are working full-time, even at minimum wage, they'll be disqualified from this benefit.”
Ostro also sees a troubling incentive problem built into the policy as he noted the structure misfires on its intended target.
“It almost incentivizes you not to work full-time because you get more benefits otherwise. I'm not sure the eligibility really drives after the right cohort of people,” he said.
A second, critical flaw with the CDCP in Ostro’s view is the plan’s incompatibility with private insurance. Unlike public health plans that complement employer coverage, the CDCP overrides it, creating confusion and risk for employers.
This setup, he warned, may lead employers to drop dental benefits under the false assumption employees are covered elsewhere. As the current rollout stands, Ostro underscored it creates a dangerous illusion of security that could mislead both employers and plan members into making decisions that ultimately strip away better private coverage.
“If I'm an employer, I might be thinking, ‘Why do I pay for something that the employee might not value because they could get it for free anyways’,” he said. “They’re not necessarily getting it for free but it could create this very weird misalignment where employers assume employees are covered, cancel the benefit, and now the employee’s left with nothing. What you end up left with is a lot of people now in way worse shape than they were before this rolled out."
Beyond eligibility, Ostro sees serious cracks in the design of the plan. He points to three core limitations: the types of procedures covered, the share of costs paid by patients, and the low reimbursement rates offered to dentists. And while some services are included, key procedures like dentures are entirely excluded.
But the most concerning piece for Ostro is the fee schedule itself. What the government is willing to reimburse dentists per procedure “is quite low relative to both what dentists typically charge and also what the associations, like the Ontario Dentist Association, suggest the dentist charge,” he said.
Additionally, patients expecting full coverage could still face significant bills. For instance, if a dentist charges $300 and the CDCP only reimburses $150, the patient is stuck paying the rest. Even those who qualify for full coverage could be blindsided when they visit the dentist as “there's a really strong chance that you're gonna have to pay significant dollars out of pocket,” Ostro noted.
Ostro also acknowledged a less obvious but equally troubling consequence: dentists may become reluctant to treat patients covered by the CDCP. Since the plan reimburses well below standard market rates, providers could begin turning those patients away.
He explained that dentists are allowed - and in some cases instructed - to charge their standard fees regardless of whether a patient is covered by the CDCP. They aren’t obligated to offer discounted rates based on government coverage. While a few might choose to, most likely won’t and in fact, some may decide not to accept new CDCP patients at all.
“From a pure economic standpoint, you'd probably rather cover a patient who's fully covered by a plan versus one who's partially covered and needs to pay out of pocket,” said Ostro. “It's a capitalistic society. People tend to optimize towards running a business and making money, and they have their costs, and that's just the reality of the world we live in.”
Going forward, Ostro emphasized the CDCP should integrate with private insurance rather than operate in isolation. In his view, the role of government programs should be to support those who can’t afford coverage; not to discourage people from taking personal or employer-sponsored responsibility.
Consequently, he acknowledged the government should hit pause for the rest of the rollout, acknowledge that its current design is flawed and reassess. He wants to see a clear and public message that discourages both employers and individuals from canceling their existing dental coverage based on misinformation. He underscored that it's not enough to forge ahead while ignoring the current issues, asserting the government needs to own the missteps, admit the issues, and start fixing them.
“I think that's going to be a humble message to give because you're essentially admitting that a mistake was made, which we know governments aren't great at doing, but that's what I like to see happen, and then bring in some people to rethink this,” he said.
“I want to make it very clear that I fully support the concept of this type of program, but it needs to be done properly.”
