Study reveals overregulation of dental business models

The American Legislative Exchange Council (ALEC) recently published a 12 page research paper entitled, ‘Overregulation Threatens Market-Driven Solutions in Dentistry’.  ALEC is America’s largest nonpartisan, voluntary membership organization of state legislators dedicated to the principles of limited government, free markets and federalism. Comprised of nearly one-quarter of the country’s state legislators and stakeholders from across the policy spectrum, ALEC members represent more than 60 million Americans and provide jobs to more than 30 million people in the United States.

In the paper, the author, Mia Palmieri Heck, discusses and analyzes the increasing regulatory and legislative efforts to restrict and even ban dental support organizations in several states.  The ALEC study points to the many benefits of dental support organizations, including increased access to care, lower cost of providing that care, and better patient outcomes when dentists are free from the distraction of non-clinical (support) activities. For a list of clinical (services only a licensed dentist can do) versus non-clinical activities (duties which may be provided by a non-dentist), please see graphic below.

Even with all of the aforementioned benefits, dental licensing boards in several states have tried to limit or restrict dentists’ ability to contract with a dental support organization through regulatory and legislative means.  The main function of a state dental licensing board should be to protect patients from harm, as well as to monitor, regulate, and oversee the licensing process.  The licensing board should not be in the business of creating anti-competitive regulations and legislation to benefit and protect the solo practice owners that may sit on the board.

Example of state overregulation of DSOs:

  • North Carolina – [2015] The Unites States Supreme Court ultimately confirmed the findings of a lower court that the NC Board of Dental Examiners had unreasonably restrained trade in violation of the federal antitrust laws.
  • Texas – [2014, 2015] The Texas State Board of Dental Examiners proposed new rules restricting the ability of dentists to enter into contracts with ‘unlicensed persons’ for non-clinical functions.  The board also tried to expand its authority to take disciplinary action against dentists who chose to contract with a DSO.  The board received numerous public comments and letters protesting these proposed rules, including a letter from the Federal Trade Commission.  These proposed rules were eventually withdrawn by the board.
  • Maryland – [2014, 2016] Maryland’s state board tried to adopt regulations making it nearly impossible for DSOs to operate in the state, even though dental support organizations have operated in Maryland for decades.  The MD administration did not approve these regulations, so the MD state dental association and board of dental examiners sought legislation restricting the business functions a DSO could provide.
  • Wisconsin – [2015]  The Wisconsin state dental association sought legislation that would give the dental board authority to regulate dental support organizations on matters related to non-clinical activities.  The bill did not pass mainly due to state legislators, many of whom are members of ALEC.

Mia Palmieri Heck

Heck is Director of ALEC’s Health and Human Services Task Force.  She leads the nationwide effort to promote free-market, pro-patient health care reforms at the state level. In her immediate past position she served as an executive at a Texas-based child and family services provider, where she led the strategic planning and program development efforts for the agency.

To review the entire study, which is the source for the majority of the content in this piece, click HERE.

 

 

Beth Miller, Contributing Editor, GDN

 

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