Bill to increase dental plan transparency clears Senate with bipartisan support

CDA-sponsored Senate Bill 1008 (Skinner, D-Berkeley), which calls for more value and transparency from dental plans, is moving swiftly through the Legislature. The bill in late May passed the Senate with bipartisan support despite strong opposition from the dental plan lobby.

SB 1008 supports patient choice of provider and helps level the playing field for providers and patients. The bill will require standardized disclosures for all dental benefit plans using a uniform Summary of Benefits and Coverage template, which will include the dental plan’s dental loss ratio (DLR) along with other plan details, including covered services, reimbursement levels, estimated enrollee cost share, limitations and exceptions.

The bill also requires plans to disclose specific information to out-of-network providers so they can help their patients make informed decisions regarding their dental treatment. This information includes the criteria and procedure the plans use to decide whether to pay for services, the dental treatment and procedures covered, the actual percentages or amounts payable as a benefit toward dental care or treatment, and notification of payment issued by the insurer to the insured for dental treatment rendered by the billing provider.

The standardized form will help purchasers and patients better understand and evaluate their options for dental coverage. Requiring that plans fully communicate with providers about an enrollee’s coverage and benefits will allow dentists to better educate and counsel their patients in treatment planning and help avoid high “surprise” bills.

“With SB 1008, we continue our advocacy work to hold dental benefit plans accountable and require greater plan transparency so consumers can make purchasing decisions knowing more about how their health care dollars are spent,” said CDA President Natasha Lee, DDS.

The bill builds off legislation CDA sponsored in 2014, AB 1962, also authored by Skinner, which created a standardized requirement for dental plans to annually disclose to state regulators and the public their “loss ratio,” or how they spend patient premium dollars. Three years of dental plan reporting demonstrated a wide variation in DLR by product type and market, with plans falling as low as 4 percent spent on patient care, raising significant questions about the consistency and value of plans. The average DLR in 2014-15 in California was 61 percent, considerably lower than the 76 percent average reported nationwide.

As CDA reported in March, under current law, all medical insurance plans must adhere to a “medical loss ratio” standard requiring them to disclose how they spend insurance premium dollars and to spend a certain percentage directly on patient health care rather than administrative overhead and profits. Medical plans for large groups must spend 85 percent of all premium dollars on health care; 80 percent is required for small group and individual products. The MLR requirement ensures a minimum value for consumers and holds insurance companies accountable for how they are spending patients’ dollars, but currently there is no standard for assuring value in commercial dental benefit plans.

Language in SB 1008, as introduced in February, would have required dental benefit plans to meet a minimum DLR, but this language was removed as the Legislature was not comfortable with implementing a DLR without greater standardization of dental benefit plans. However, the current bill does include a requirement that dental plans provide consumers with the previous year’s DLR for each product, whereas the 2014 legislation only required the plans to report this information to state regulators. While it will not be the only item consumers evaluate when purchasing a dental benefits plan, CDA believes it will raise significant questions for a purchaser who sees that a specific plan spends a low percentage of premium dollars on patient care and encourage them to look for a higher value plan.

Legislators hear from CDA members

CDA thanks the hundreds of CDA members who engaged in grassroots advocacy, responding to the association’s call to action by contacting their representatives or sending letters urging them to support the bill.

“CDA believes that patients deserve greater protections and value from their dental plans,” said Dr. Lee. “If passed, SB 1008 will improve dentists’ ability to educate their patients and move California further down the path.”

The bill will next be heard in the state Assembly.

CDA will update members on the status of the bill on cda.org and in an upcoming issue of the Update.

Related Items

Assembly Bill 3087 was held in the Assembly Appropriations Committee May 25 and will not move forward in the current legislative session. As CDA first reported in April, AB 3087 would have created a new government commission of appointed members to regulate and cap commercial payment rates for health care providers. The Assembly heard the strong concerns raised by CDA and a large coalition of health care providers, including through direct member advocacy and grassroots efforts.

CDA-sponsored legislation, Senate Bill 1148 (Pan, D-Sacramento), which if passed would allow dentists who provide care in the Medi-Cal dental program to be reimbursed when they use silver diamine fluoride for dental caries treatment, passed out of its first committee hearing — the Senate Health Committee — in April and was due to be heard by the Senate Appropriations Committee in late May.

New legislation sponsored by CDA and introduced by Sen. Nancy Skinner (D-Berkeley) is working to increase value and transparency of dental benefit plans. Senate Bill 1008 calls for the establishment of a minimum dental loss ratio for individual, small and large group dental benefit products and requires increased transparency for consumers who purchase dental savings or dental discount products by requiring standardized disclosures of what a dental benefit plan does or does not provide.