Which statement best describes the role of probationary periods in a group dental plan?

• A. They help prevent adverse selection.
• B. They increase administrative costs.
• C. They shorten the eligibility period.
• D. They are only for dependents.

Answer: (A)

Probationary periods are about controlling who and when benefits become available, not about shortening or increasing costs. By placing a waiting period before new hires are eligible for group dental plan coverage, the plan discourages individuals from joining just to get benefits for a short time and then dropping coverage. This reduces adverse selection, where the group would otherwise attract mainly people who expect to use a lot of dental services right away, driving up costs for everyone. It also means eligibility isn’t shortened; it’s delayed for a period. While there may be some administrative tasks involved, the primary purpose is risk control, not cost increases. And probationary periods apply to new employees, not exclusively to dependents.