Dental plans oppose CDA bill

Legislation aimed at making sure dental plans put more of their revenues into actual care for patients passed its first legislative hurdle.  AB 18 (Pan), championed by CDA, successfully moved through the Assembly Health Committee, overcoming strong objections from dental plans and health plans. 

This groundbreaking piece of legislation authored by Assembly Member Richard Pan, MD, MPH, (D-Sacramento), would require dental plans operating in the new state Health Benefit Exchange to abide, for the first time, by several consumer-focused provisions that currently only apply to medical plans.

CDA’s sponsored legislation applies patient protections and market reforms, including a medical loss ratio (MLR) on patient premiums, to dental plans participating in California’s new health insurance marketplace created pursuant to the Affordable Care Act.  

An MLR for dental plans would require a minimum percentage of a dental plan’s gross premium collections to be spent on actual treatment and care.  In other words, the bill limits the amount of premium collections that can be applied to the plan’s administration of the benefit (less taxes and fees).  If the plan fails to do so, the bill would require each plan to reimburse their policyholders.

The California Association of Dental Plans and several individual dental plans, including Delta Dental and Liberty, opposed the bill in committee. The resistance from these companies to the legislation centered on the creation of an MLR for their plans, citing as reason for their opposition the numerous administrative functions and costs associated with operating a dental plan. Dental plans claim that they need to retain more than one-third of each premium dollar for administrative costs, with less than two-thirds going to actual care. 

Testifying at the hearing on behalf of CDA was Irving Lebovics, DDS, co-director of the Hospital Dentistry General Practice Residency Program at Cedars-Sinai and liaison to CDA’s Government Affairs Council from the Policy Development Council. 

“We saw last year the tragic stories out of Sacramento and Los Angeles about the many problems children had in accessing their dental coverage in the Medi-Cal Managed Care system operated by dental plans,” Lebovics said. “We need to ensure the Exchange starts on the right foot and has a strong structure in place to ensure patients can actually get the care they are paying for.”  

AB 18 will also clarify state law to ensure dental plans can compete in the Exchange. The technical, but important, clarification will ensure families have more choices in how they configure their health and dental coverage after 2014, when the Exchange goes online. 

“AB 18 is a groundbreaking measure in that it ensures successful implementation of the Affordable Care Act in California,” Lebovics said during his testimony. 

Also testifying at the hearing was Paul Reggiardo, DDS, speaking in strong support of the bill on behalf of the California Society of Pediatric Dentistry. 

“AB 18 requires the purchase of pediatric dental benefits for all children in the California Benefits Exchange, which is clearly in keeping with the intent of the Affordable Care Act and represents good public policy for California,” Reggiardo said. “The bill also applies standard patient protections … such as timely access to care standards and network adequacy requirements. These are clearly critical protections my patients need.” 

AB 18 will be heard next in the Assembly Appropriations Committee. CDA is actively working to support this legislation and will continue to keep members informed as it progresses through the legislative process.