Another Look at Dental Insurance Market Share
Earlier this year in Action, we took a look at the National Association of Insurance Commissioners’ (NAIC) rate filings for a few years preceding 2025 to see what we could learn about Georgia’s local dental insurance market. The Government Accountability Office (GAO) recently released a new 50 state analysis of the fully insured dental market. The analysis relies on NAIC data and offers some insight into dental benefits across the nation.
States’ Competitiveness in Dental Benefits Markets
Before diving into the analysis, it is important to note that it lacks information on a major chunk, about 46%, of the dental benefits market since it does not reflect self-funded plans. Still, the analysis captures information on the dental benefits market for about a quarter of Americans. Overall, the analysis indicates that the median market share of the single largest insurer in the group market is 38%, with a range of 13.6%-95.1%. The individual market is similar, with a median of 34.5% and a range of 14.4%-95.1%. Group markets are made up of a median 39 insurers per state, and individual markets have a median 22.
The analysis also looked at market concentration among the top 3 insurers in each state. Nationally, group markets show a median concentration of 66.8% and individual markets 69.5%. The ranges were 37.9%-97.5% and 37.5%-97.5%, respectively. Some states have extremely concentrated markets, and these states are distinct in part because of their size. Delaware, Hawaii, Vermont, and Iowa all have market concentrations of 90% or above among the top 3 insurers. Notably, several of these states have populations on the smaller side, like Vermont, which ranks 49th out of 50.
States of a similar size are for the most part at or above the median; however, it is obvious that other characteristics are to blame for elevated concentration. Regulations can make a big difference. Just across the border in Alabama, a single company, Blue Cross Blue Shield of Alabama, is dominant, and it holds a 50% market share in the group dental benefits market, a 60% market share in the individual dental benefits market, and a 94% market share in the large group health insurance market. To compare with Georgia, Cigna holds a 21% market share in the group dental benefits market, United a 23% market share in the individual market, and Elevance a 41% market share in the large group health insurance market.
Insurers have clear incentives that drive them toward concentration. There is an inverse relationship between size and risk. There are economies of scale in claims processing, and there are size advantages in contracting. However, increasing concentration is bad for health care providers and their patients. For providers, carriers’ leverage drives down reimbursement (see above, “advantages in contracting”). Mergers also tend to raise premiums.
Plan Design is Also a Factor in Benefits’ Functionality
Dental benefits function differently from health insurance in the United States. Rather than a max-out-of-pocket cost for the patient, prioritizing their health and well-being, dental benefits plans typically use an annual maximum benefit in their plan design. The effect of the annual maximum is to curb costs, by reducing shared risk, but it also delays and prevents adults (about 46%) from seeking dental treatment. The likelihood of reaching an annual maximum also increases with age, and the United States' population is aging.
While annual maximums do decrease the up-front price of dental benefits, they decrease the downstream value of said benefit, and their impact is less than one might expect. One Anthem plan rate manual submitted to NAIC’s filing system in December of 2024 indicates that raising the maximum benefit to unlimited would adjust the monthly premium by 41.63%, or about $14 for an individual and $42 for a family.
Looking to the Future
Georgia is better off than some states, and preserving its existing level of competition while driving more competition should be a policy priority, as should developing market conditions for plan design that works for dentists and their patients. Advocacy related to dental insurance is always ongoing. If you are interested in getting involved, consider becoming a contact dentist, donating to GDAPAC, and attending LAWDay 2027.