Dental Practice Owners : How Does the Canadian Dental Care Plan Impact You?

The Canadian Dental Care Plan (“CDCP”) will provide eligible Canadian residents with dental insurance coverage. Beginning in 2024, individuals can apply for the CDCP. To be eligible, individuals must have an annual adjusted family net income (“AAFNI”) of less than $90,000 and must not have access to any kind of dental insurance benefits or dental coverage, including health and wellness accounts (“dental benefits”).

1. What are the implications of the CDCP for dental practice employers (“DP Employers”)?

DP Employers have new reporting requirements related to the CDCP. DP Employers must disclose if they do or do not provide dental benefits on employees’ T4s (the same is true for T4As, if applicable). DP Employees who already receive dental benefits of any kind are not eligible to participate in the CDCP, even if such employees have a AAFNI of less than $90,000.

2. Are employees who have a AAFNI of less than $90,000 and who receive dental benefits from a DP Employer eligible for the CDCP?

To be eligible for the CDCP, a person must 

1. not have access to dental insurance, which is defined as:
   1. no dental insurance through an employer or a family member’s employer benefits, including health and wellness accounts;
   2. no dental insurance through a pension (previous employer) or a family member’s pension benefits; or 
   3. no dental insurance purchased by the person or by a family member or through a group plan from an insurance or benefits company;
2. have an AADNI of less than $90,000;
3. be a Canadian resident for tax purposes; and
4. have filed a tax return in the previous year

Canadians who receive dental insurance through a social assistance program may still be eligible for the CDCP – the coverage between the two programs will be coordinated. Beginning with the 2023 tax year, employers who issue a T4 (Statement of Remuneration Paid) for employees must report if, on December 31st of the taxation year, a “payee” (or any family member) was eligible to access dental insurance or dental coverage as a result of employment.  There could be financial penalties if a DP Employer fails to report this information. For 2023, if reasonable efforts have been made to comply, it is not mandatory to fill out the new T4 boxes when only Code 1 (see below) is applicable. 

Individuals, who can begin to apply for the CDCP in 2024, will provide their personal coverage status in the CDCP application process. An employer will not provide detailed information about an employee’s coverage status (e.g., whether they waived coverage or are covered under a spouse’s plan). DP Employers must report if they offer dental benefits even if an employee has chosen not to take the coverage. Of note, the amount of dental benefits offered does not seem to be relevant to CDCP eligibility, only that dental benefits are offered by the employer. Please see ss. 4(1) of the Dental Care Measures Act below which refers to “any dental care insurance, or coverage of dental services of any kind.” Box 45 (Employer-offered Dental Benefits) of the T4 is new and is filled in by codes, not dollar amounts. The following codes are entered into the new T4 Box 45:

Code 1 – no coverage of dental services/access to dental insurance

Code 2 – coverage of dental services /access to dental insurance for payee 

Code 3 – coverage of dental services /access to dental insurance for payee, spouse and dependants

Code 4 – coverage of dental services /access to dental insurance for payee and spouse

Code 5 – coverage of dental services /access to dental insurance for payee and dependants

The Dental Care Measures Act states:

4 (1) Every person (e.g. employer) who is required to make an information return … must, in the information return for every person (in this section referred to as the “payee”) … indicate whether the payee or any of their family members were … eligible in respect of the payee’s employment or former employment, or that of the payee’s spouse or common-law partner, to access any dental care insurance, or coverage of dental services of any kind, offered by the person.

Conclusion

DP Employers should ensure compliance with the new reporting requirements with regard to the CDCP, specifically the T4 reporting requirement. Employers will not have access to their employee’s AAFNI and will report whether or not they offer dental benefits. Individuals can only use the CDCP at participating oral health providers. DP Employers who wish to participate in the CDCP as oral health providers will be able to voluntarily enrol in 2024 to provide services through the CDCP.
The contents of this article are not to be construed as legal advice. Contact Emerge Law’s lawyers for legal assistance. Should you require any assistance, please contact info@emergelaw.ca and book an appointment with  Hani Al-Dajane.