03/10/2014

CDA legal action against Delta takes shape


CDA’s arbitration with Delta took a step forward on Feb. 25 with a “preliminary hearing” conference call with the panel of arbitrators assigned to the case. The purpose of the call was to schedule dates for different stages of the arbitration.

In light of the extensive briefing that has already been submitted by both parties, the panel of three arbitrators has indicated it will likely decide two significant issues by early April. The first is CDA’s “Application to Preserve the Status Quo,” which would prevent Delta’s amendments to provider contracts from being deemed effective as of Oct. 4, 2013. CDA is challenging the legality of Delta’s proposed changes to provider agreements which would eliminate a current requirement that Delta provide justification for changing its reimbursement rates and restrict dentists’ ability to use arbitration to challenge Delta’s actions. The second issue is Delta’s argument that CDA itself should not be permitted to appear in the arbitration on behalf of its members. The arbitrators concluded that these important initial issues should be decided before proceedings continue. 

Delta also announced that it intends to file a “dispositive motion,” which it described only vaguely. CDA believes Delta plans to urge the arbitration panel to dismiss CDA’s claims because the Department of Managed Health Care has already approved the two amendments that are challenged in the litigation. CDA questions the strength of this motion, in light of the fact that Delta filed its application with the DMHC as a confidential filing, allowing no comment by anyone affected by it. CDA does not believe the DMHC intended its approval of Delta’s filing to have any preclusive effect on the rights of dentists. The parties have agreed to a briefing schedule so that this motion will be heard by the arbitrators on May 5. 

At that same hearing, arbitrators will consider the issues of discovery, exchange of exhibits, depositions and any similar issues. We expect that the arbitrators will also set a date for the arbitration hearing itself, either at the May 5 hearing or before. We anticipate that the arbitration will be scheduled sometime in August or September. 

CDA will continue to keep you informed on the progress of the arbitration in the Update, newsletter and on cda.org.