The recent introduction of a new dental plan by the Canadian government has sparked a crucial debate for Canadian companies when it comes to managing employee benefits. Although the government's initiative is aimed at providing dental coverage to a larger proportion of the population, it is not necessarily advantageous for companies to opt for this new plan and cancel the dental benefits they offer their employees. Several factors need to be taken into account before making such a decision.
Firstly, the quality and scope of coverage offered by the government dental plan may not correspond to the specific needs of a company's employees. Many private dental plans offer more extensive coverage, including orthodontic treatment and higher annual ceilings, which may not be available under the public plan. By purchasing their own dental insurance, companies can ensure that their employees have access to necessary treatments without limitations.
Furthermore, only people aged 65 and over, children aged 18 and under and disabled people are covered by the federal plan. Certain low-income families are covered with decreasing reimbursement coefficients, as indicated below.
Adjusted Family Income | Coverage under the CDCP | What you pay |
Less than 70 000 $ | 100% of the cost of eligible oral health care services will be covered according to the rates established by the CDCP. | 0 % of the cost established under the CDCP. |
Between 70 000 $ et 79 999 $ | 60% of the cost of eligible oral health care services will be covered according to the rates established by the CDCP. | 40 % of the cost established under the CDCP . |
Bewtween 80 000 $ et 89 999 $ | 40% of the cost of eligible oral health care services will be covered according to the rates established by the CDCP. | 60 % of the cost established under the CDCP . |
It's clear that, at the income level required to be reasonably covered (60 to 100%), you have to be one of the lowest-paid Canadians in the corporate environnement, and companies where salaries are among the lowest usually don't have a dental plan. For them, the federal plan is a lifeline.
However, benefits, including dental coverage, play an important role in attracting and retaining top talent within an organization. A comprehensive benefits package, including dental insurance, is often a key factor for jobseekers when evaluating employment opportunities, especially since in internal surveys, the dental plan often appears at the top of employees' concerns. By offering their own dental plan, companies can distinguish themselves as employers of choice and potentially reduce turnover rates.
In addition, the financial consequences of cancelling company dental plans need to be carefully assessed. While shifting the cost of dental coverage to the government may seem cost-effective at first, companies need to consider the long-term effects on their overall compensation strategy and employee morale. Investing in employee benefits, including dental insurance, means investing in the health and well-being of the workforce, which can ultimately lead to increased productivity and employee engagement.
To conclude, while the introduction of a new government dental plan may offer another option for dental coverage, especially for the more disadvantaged clientele, Canadian companies should carefully weigh the pros and cons before considering cancelling their own dental insurance plans for their employees. Employee retention, benefit customization, administrative efficiency and long-term financial implications are essential considerations that should not be overlooked in this decision-making process.
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