US Senate Report Calls for Corporate Dentistry Reforms

Laird Harrison

August 21, 2013

( UPDATED September 5, 2013 ) Isaac Gagnon's mother knew a mobile dental clinic was visiting his preschool, but she expressly forbade its dentists from operating on Isaac. So she was shocked to peer into his mouth one afternoon and find shiny new amalgam fillings.

So says a US Senate report on the corporate practice of dentistry, published online July 23. And it gets worse: The 4-year-old boy had suffered brain damage from prior abuse and was on a fragile road to recovery, the report says.

After the dental team held him down, kicking and screaming, to administer the treatments, Isaac regressed, becoming so angry he could not return to school, it says. To top it off, the report adds, Isaac apparently did not need the fillings.

Such horrific tales have surfaced again and again as corporate dental practices play an increasingly important role in US dentistry.

Although the majority of dentists still work for themselves, that is gradually changing. According to a report by the American Dental Association's Health Policy Resources Center, the proportion of dentists who are in solo practice declined from 76% in 2006 to 69% in 2010.

"The perspective of thoughtful policy folks is that private practice is dead in this country within the next decade or 2," Frank Catalanotto, DMD, a professor at the University of Florida in Gainesville and vice chair of Oral Health America, told Medscape Medical News. "We're going to see more and more large corporate practices."

Many Complaints

With the change have come complaints. Investigations by journalists as well as state and federal authorities have produced multiple reports of Medicaid patients receiving unnecessary treatment, sometimes forcibly and without parents' permission.

The Finance Committee report, coauthored by staff under Sen. Max Baucus (D-Montana) and Sen. Chuck Grassley (R-Idaho), drew a connection between these accusations and whistleblowers' reports that some corporate practices are skirting state laws requiring that all dental practices be owned by dentists.

"Profits are being placed ahead of patient care," the report charges. At least in 1 case, the Small Smiles clinics operated by Committed to Smiles and a Healthy Mouth (CSHM), dentists are compensated partly by the revenues of their clinics, it says: "This productivity-based compensation arrangement prioritizes volume, operative procedures over preventive care, and encourages unnecessary care."

The Senate staffers reject the argument that corporate dental practices are necessary because so few private practice dentists are willing to accept reimbursement through Medicaid.

If low reimbursement is a problem, they write, then the answer is to license more midlevel dental practitioners. Needing less education, they say, these practitioners could charge less than dentists for their procedures.

The report offers 3 recommendations:

  • Dental practices should not get reimbursement through Medicaid if they violate state laws requiring practices be owned by dentists.

  • The 22 states with existing laws against corporate ownership of dental practices should better enforce their laws.

  • The federal government should allow Medicaid reimbursement of midlevel dental providers.

However, not everyone in the world of dental policy is ready to sign onto the report's findings or its conclusions.

CSHM Defends Itself

CSHM is among the most vocal objectors. The company says it has rapidly improved since emerging from bankruptcy with new management on June 1, 2012. "This report is all addressing concerns that came up under the previous management," Julie Lilliston, a public relations consultant hired by CSHM told Medscape Medical News.

An independent monitor assigned by the US Department of Health and Human Services has found violations since the new management took over, the company acknowledges in a public statement. However, those were problems left over by the previous management and are being corrected, and the monitor is now giving the Small Smiles clinics better reports, according to the statement.

Moreover, Small Smiles clinics are truly owned by dentists who hire and fire staff and set budgets and who can close down the clinics if they choose, Lilliston's colleague, Rosemary Plorin said in a follow-up email.

The Senate report draws no conclusions about whether the problems it identifies are confined to CSHM or whether they occur in other large dental companies.

Although starting with a wider net, the Senate researchers quickly narrowed their investigation to CSHM and one other company, Reachout America.

Reachout America contracted with the dental team blamed for mistreating Isaac Gagnon, but the Senate staff determined that the individual dentists, not Reachout America, should be blamed in that incident and some similar ones. Reachout America provides only administrative services and does not own the dental clinics it works with, the committee said.

Reachout America did not respond to a request for comment.

Experts Disagree

Others in the dental world have faulted the report's recommendations.

"They are right," Dr. Catalanotto said. "We have a problem when healthcare become a commodity and practitioners are rewarded by how much treatment they do rather than the quality of the care."

However, Dr. Catalanotto disagreed with the report's emphasis on management structure. "The problem is not the corporate model," he said. "The problem is the corporate model with the profit motive. Just requiring that a dentist be in charge does absolutely no good." Rather, state boards of dentistry must vigorously enforce existing regulations, he said.

That suggestion echoes the position of the American Dental Association in a written response to the report.

What data are available on corporate dental practices suggest they have expanded the number of children getting dental care through Medicaid, said Burton L. Edelstein DDS, MPH, a professor at Columbia University in New York City and founder of the Children's Dental Health Project. "Analysis of care provided to low-income children in Medicaid demonstrates a significant contribution by corporate dental providers."

In his own June 2012 policy brief, Dr. Edelstein wrote that "the largest and best managed of the DMOs [dental management organizations] utilize rigorous metrics that seek to identify and address practitioners who over treat."

As a result, he found the Senate report "informative," but flawed. "The report suggests that if private dentists find low Medicaid rates problematic for profitability, then DMOs, facing the same low rates, must be sacrificing quality of care," he told Medscape Medical News in an email. "However, the DMO's...have a significantly different business model/cost-structure that markedly reduces their overhead, making the direct comparison and conclusion problematic."

The DMOs manage to cut costs not by providing lower quality but by locating in places with inexpensive real estate, purchasing in bulk, and offering flexible schedules to indigent families who have trouble getting to appointments, Dr. Edelstein argued in his policy brief.

As for midlevel providers, Dr. Catalanotto pointed out they are already receiving reimbursement through Medicaid in Alaska and Minnesota, the 2 states where they are currently licensed to practice.

Although the Affordable Care Act authorizes funding of demonstration projects to test the viability of midlevel provider licenses in other states, Congress has never appropriated funding for the projects.

A spokesperson for Sen. Baucus said no one was available to respond to these comments.

Speaking for Sen. Grassley, Jill Gerber said the Senator "would not oppose the demonstration projects nor any state's creation of a similar licensure designation."

In the meantime, what will the Centers for Medicare and Medicaid Services do about companies that violate state laws about ownership? Not much, Don White, spokesman for the centers' Office of the Inspector General, told Medscape Medical News. The office can bar reimbursement for entities that commit Medicaid fraud and excludes about 3000 entities per year from reimbursement; currently, about 1500 dental practices are excluded, he said. However, the office does not have the legal authority to exclude anyone from reimbursement based on ownership structure or violations of state law.

White tossed the ball back to the legislative branch: "If Congress chooses to add another exclusion, then we could do it," he said.

"Joint Staff Report on the Corporate Practice of Dentistry in the Medicaid Program." Senate Finance Committee. Full text

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