Getting the Green Light: Creating a Path for Wellness Plans
WSDA representatives met with the Office of the Insurance Commissioner (OIC) in early December with one objective in mind: Come up with a plan to replace the “wellness plans” the OIC had determined were not consistent with Washington state insurance law. Grassroots advocates Drs. Greg Yen and Cindy Pauley (WSDA’s president-elect) worked with WSDA staff and contract lobbyists to build consensus for a path forward.
The OIC’s concerns with some dental wellness plans
In recent months, WSDA learned that the OIC had been investigating discount dental wellness plans that some dentists offer to their patients. The OIC investigations are generally complaint-driven, and when the office finds a program out of compliance with state law, it normally sends a cease-and-desist letter to the provider.
WSDA’s advocacy team reached out to the OIC’s Legislative Director and Deputy Commissioner of Legal Affairs to learn more about the OIC’s concerns, and how dentists might restructure their programs to address them.
While OIC understands and appreciates the goal dentists have to provide access to affordable care, it believes that some wellness plans do not comply with state law. Current law states that a provider (medical, dental, chiropractic, etc.) cannot offer discounts for a membership fee. Those arrangements are considered “discount plans,” which must follow specific laws and require registration and licensure as a “discount plan organization.”
OIC believes that providers cannot offer a subscription type of program because it is considered to be prepayment for medical services, and prepaid medical services are considered insurance that would be subject to the same regulation as insurance companies. There is a very limited circumstance in which this is allowed for medical care.
WSDA strongly believes that patients should benefit from a robust, diverse dental benefits market where patients can choose the type of dental benefit that is right for their situation. Dental wellness plans can provide a venue for patients to obtain necessary dental care and also prioritize prevention. WSDA sought to find a path forward for dental wellness plans that complied with all OIC regulations. Yen, a WSDA member who has spent considerable time creating dental wellness plans, worked with WSDA leaders and staff to develop a new way that did not include prepayment or any sort of membership fee.
The new way
As expected, Yen did not disappoint. WSDA worked with Yen and Pauley to provide advance materials and prepare for a meeting to discuss the matter. At the December meeting with OIC, the team outlined the goal of providing an alternative consumer choice for dental care in today’s consumer-driven healthcare marketplace and establishing guidelines for prevention-based dental care programs. Experience has shown that in-office discounts and treatment credits incentivize use of prevention-based programs by patients by enhancing the sense of belonging to a dental home and encouraging return visits.
The model that was proposed to OIC called for the use of in-office vouchers or certificates that can be given to patients after their first annual visit to a dental office. These certificates can be customized for preventive care, restorative care, or other services, and include “percentage off” discounts for treatment or a credit for a specific dollar amount. The certificates can also include specific expiration dates, and the same voucher system can be re-created in future years.
After deliberating upon the materials presented at the meeting, OIC sent official word to WSDA that the proposed payment model did not raise any regulatory concerns and had the green light to proceed. Thanks to the hard work and creativity of Yen and other WSDA advocates, modified wellness plans will remain a viable alternative to traditional dental benefits, and an option to attract and retain patients.
Look for more information about dental wellness plans from WSDA in the months ahead. Questions can be directed to email@example.com.
Wellness Plan FAQs · By Dr. Greg Yen
Q. What is an in-office annual dental wellness plan?
A. It is a self-administered program that any dental office can directly offer to the uninsured public.
Q. What format is allowed?
A. The OIC has strongly prohibited any pre-payment format (i.e., prepay X amount for X number of annual services) or pay-for-your-discount format (i.e., pay X amount for X percent discount off all practice services). The easiest way to think about it is a “buy one, get one at X percent off” format (i.e., buy your PEX at full price and get a free voucher for your six-month PE at X percent off, expiring in six months). Include a free X percent off voucher for all other dental services, a free $ X in-office treatment gift card, and any other incentive vouchers your office can create. All expire in 12 months.
Q. Why make the vouchers expire in 12 months?
A. You want the patient to think of your program in annual terms. We suggest your brochures and website read accordingly. You can also incentivize them to renew (i.e., after three consecutive years, get a free X ). Remember, you’re trying to build loyalty to your practice exclusively.
Q. What about “Most Favored Nation” clauses in PPO arrangements?
A. Some PPO contracts have something called a “Most Favored Nation” clause, which prohibits offering a discount greater than the PPO. You would need to decide if that PPO or your autonomy is more valuable to your future.
Q. Anything else?
A. We suggest making the vouchers/certificates virtual (your front office keeps track), as keeping track of little pieces of paper and authenticating such paper is cumbersome. Most importantly of all, keep your program as simple as possible for you, your staff, and your patient’s sakes.
Editor's Note: You can learn more about wellness plans from Dr. Yen at this year’s Pacific Northwest Dental Conference, where he will be speaking on Thursday.