In 1973, the typical dental insurance plan came with an annual maximum benefit of $1,000 to $1,500. That was the ceiling on what your insurer would pay for your dental care in a given year. In 2026, more than five decades later, the typical dental insurance plan still comes with an annual maximum of $1,000 to $1,500.1 The world has changed beyond recognition since 1973. Dental insurance has not.
This is not an oversight. It is not a market waiting for innovation to catch up. It is a system working exactly as designed — for everyone except patients.
The Inflation Gap No One Talks About
Let us put the $1,500 annual maximum into perspective. In 1973, $1,500 had the purchasing power of roughly $9,000 to $10,000 in today's dollars, depending on which inflation index you use.2 National dental expenditures have increased approximately 12.5 times since the mid-1970s, from around $13 billion to over $160 billion annually.3 Yet the plan maximum that was supposed to cover meaningful dental care has stayed flat.
Think about what else cost the same in 1973. The average home in the United States sold for around $32,500. The average new car was about $3,500. Nobody would accept those numbers today for a house or a car. But the dental industry has trained us to accept them for the ceiling on our oral health coverage.
According to the National Association of Dental Plans, 32.8% of in-network PPO maximums remain between $1,000 and $1,500.4 That is not a rounding error. That is a third of the market anchored to a half-century-old number.
Why the Maximum Never Moved
If you are looking for a technical or regulatory explanation for why the annual maximum has not increased, you will not find one. There is no actuarial law that pins the number at $1,500. The answer is simpler and less flattering: the current structure is profitable.
Dental insurance carriers collect premiums from employers every month. They pay out claims until the annual maximum is hit, then stop. The lower the maximum, the more premium dollars the carrier retains. And here is the detail that makes the math even more striking: only about 2.8% to 3% of PPO enrollees actually hit their annual maximum in a given year.5 The maximum functions less as a meaningful coverage limit and more as a psychological ceiling that suppresses utilization.
"Dental insurance isn't really insurance. It's a discount plan with a cap — and the cap hasn't moved since Richard Nixon was in office."
Employers, meanwhile, keep buying the same product year after year. Dental benefits are often bundled into a larger medical package, and few HR teams have the bandwidth to scrutinize the dental plan independently. The renewal comes in, the premium ticks up a few percent, and the maximum stays right where it has been since the plan was first written.
The result is a product that looks like insurance but functions like a prepaid discount card with a hard spending limit. Employers pay premiums. Carriers manage the float. And patients are left covering the gap out of pocket.
The Real Cost to Patients
The consequences of this frozen maximum are not abstract. A single dental crown today costs between $750 and $2,000, depending on the material and the market.6 One crown can consume half or more of a patient's annual benefit. A root canal and crown together can exceed the entire annual maximum. A dental implant — often the medically optimal replacement for a missing tooth — typically costs $3,000 to $5,000, well beyond what any annual maximum will cover.
The downstream effects are predictable. According to the ADA's Oral Health and Well-Being Report, 46% of Americans report skipping or delaying dental care because of cost.7 When people skip preventive care, small problems become big ones. Untreated decay becomes extraction. Deferred periodontal treatment becomes bone loss. The total cost of care goes up, not down — but those costs shift to the patient and to the broader healthcare system, not to the dental carrier.
And this is to say nothing of the 68 million Americans who lack dental coverage entirely.8 For them, the annual maximum is not the constraint. Access is.
Where the Money Actually Goes
One of the less examined aspects of dental insurance economics is the administrative overhead. According to data compiled by the NADP, between 25% and 40% of dental plan costs go to non-clinical administration — carrier overhead, claims processing, network management, credentialing, and utilization review.9
Put another way: for every dollar an employer spends on dental premiums, as little as 60 cents may reach an actual dentist. The rest circulates through a bureaucratic infrastructure that exists primarily to manage risk, adjudicate claims, and enforce the very restrictions that limit patient access to care.
Providers feel this too. Network participation requires accepting discounted fee schedules, navigating pre-authorization requirements, and absorbing the cost of claim denials and delayed payments. Many providers report spending significant staff time on insurance administration — time that does not contribute to patient care but that the current model demands.
What Is Starting to Change
The status quo has persisted for decades because the incentive structure rewarded inertia. But three things are shifting.
First, employers are paying closer attention. Rising premiums with flat benefits are harder to justify when employees are increasingly vocal about the gap between what their dental plan covers and what care actually costs. Benefits leaders at forward-thinking companies are asking a straightforward question: where is our money going?
Second, alternative structures are maturing. Direct dental care models, employer-funded dental wallets, and HRA-based benefit designs give employers a way to put dollars directly toward employee dental care without routing them through a carrier. These models eliminate the annual maximum entirely by design — the benefit is the funded balance, and the employee controls how it is used.
Third, providers are ready. Dental practices are leaving PPO networks in growing numbers, seeking direct relationships with patients and employers that offer fair reimbursement without the administrative burden of insurance. The supply side of the market is increasingly willing to participate in models that cut out the middleman.
None of this means traditional dental insurance will vanish overnight. Inertia is powerful. But the cracks in the foundation are becoming harder to ignore, and the employers and providers who move first will be the ones who benefit most from the transition.
The Bottom Line
The dental insurance annual maximum has not changed in over 50 years. That is not because the system works well. It is because the system works well enough — for carriers. For patients and employers and providers, the math has not added up for a long time.
If your organization is spending real money on dental premiums and your employees are still delaying care because of cost, it is worth asking whether the traditional model is serving anyone other than the insurance company. The alternatives are here. They are proven. And they are built around a simple idea that should have been the starting point all along: dental benefits should fund dental care.
Read our companion piece to learn more: What Is Direct Dental Care?