DENTISTRY is one of the fastest growing sectors of private healthcare. The 7 per cent cut in NHS dentists' fees in July, 1992 led to an exodus of dentists from the public sector. Department of Health statistics show a total of 661,281 dental patients have so far deregistered with the NHS.

The government's response to Sir Kenneth Bloomfield's review of the NHS dental system, published in December 1992, is due. It is expected to require NHS patients to shoulder an increasing proportion of the costs of their dental treatment. And medical insurers are rushing to fill the void left by the shrinking public sector.

In November Private Patients Plan bought Denplan, the UK's leading private dental healthcare business with 4,900 dentists - 25 per cent of the UK total - as members. Denplan, set up in 1986 by two dentists, pioneered the capitation scheme of payment. Dentists assess the state of a patient's teeth and charge a monthly amount to cover long-term preventive care.

Stephen Noar, co-founder of Denplan and its chief executive under PPP, hated the 'piece-work' dentistry of the NHS which he believed encouraged dentists to do unnecessary work.

Denplan has five fee categories, with discounts for children and other groups. More than 90 per cent of its patients pay between pounds 5 and pounds 15 a month for treatment. Sup plementary insurance cover includes pounds 300 per claim for emergency treatment world-wide; pounds 5,000 per claim for treatment resulting from an accident; pounds 50 for every night spent in hospital due to dental treatment.

Bupa and Norwich Union are also rolling out capitation schemes. Bupa expects to be nation-wide by September, after launching two pilot programmes in January in Bristol and Nottingham.

Jonathan Walsh, managing director of Bupa Dentalcover, said that more than 1,000 dentists have signed up and interest has been shown by 25 per cent of UK dentists: 'It is very exciting. It has surpassed our wildest dreams.'

He accepts that Denplan first sold the capitation concept, but said there was room for additional players as the market was growing so rapidly. Some of the dentists who have joined Bupa are also Denplan members.

Fenella Pound, dental marketing manager of Cigna, one of the largest underwriters of dental insurance in the UK, believes capitation works for the individual but is expensive at a corporate level. Insurance is more cost effective. She says increasing numbers of companies are providing dental insurance for employees as a simple, low cost perk with a high perceived value.

Cigna is unusual in offering stand-alone dental insurance rather than as part of comprehensive medical insurance. It provides insurance to companies with as few as 20 employees, but the costs per employee are higher than for companies with hundreds of employees.

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