Virginia Law

A. Except as otherwise provided by law, no dental plan organization shall be organized, conducted, or offered in the Commonwealth other than in the manner set forth in this chapter.

B. This chapter shall not apply to a prepaid dental services plan organized under Chapter 45 (§ 38.2-4500 et seq.) of this title, a health maintenance organization or limited health care services plan licensed to provide dental services under Chapter 43 (§ 38.2-4300 et seq.) of this title, any health service plan licensed under Chapter 42 (§ 38.2-4200 et seq.) of this title, or any insurer whose activities are regulated under other provisions of this title.

C. Nothing contained in this chapter prohibits any dentist individually, in partnership with other dentists, or as part of a professional corporation of dentists from entering into agreements directly with his own patients, or with a parent, guardian, conservator, spouse, or other family member acting on such patient's behalf, involving payment for professional services to be rendered or made available in the future.

2004, c. 668.

As used in this chapter:

"Contract holder" means (i) with respect to group contracts, the organization or entity to which the dental benefit contract is issued, and (ii) with respect to individual contracts, the individual who enters into a dental benefit contract covering the individual or the individual and dependents of the individual.

"Copayment" means the amount payable for a particular service by an enrollee in accordance with the patient charge schedule or for which the enrollee is responsible as a condition for receiving benefits under a dental benefit contract. A copayment may be expressed as a specific dollar amount or as a percentage of the allowable charge for a service.

"Dental benefit contract" means a contract that provides benefits for dental services entered into between the dental plan organization and a contract holder.

"Dental plan" means a contractual arrangement for dental services provided or arranged for, that pays benefits or is administered on an individual or group basis. A dental plan includes, but is not limited to, an arrangement where fixed indemnity benefits are paid to an individual or provider for dental services.

"Dental plan organization" means a company that provides directly or arranges for a dental plan.

"Dental service" means a service included in the current Dental Terminology Manual issued by the American Dental Association.

"Dependent" means an individual who is the spouse or child of a subscriber.

"Enrollee" means an individual or a dependent of an individual who is enrolled in a dental plan.

"Evidence of coverage" means any certificate, agreement, or contract issued to a subscriber of a group that sets out the dental services to which the enrollees are entitled.

"Fixed indemnity benefits" means the payment amount or amounts stated in the reimbursement schedule of a dental plan organization that will be paid to a subscriber, or to the subscriber's dentist, for dental services.

"Plan dentist" means any dentist, licensed by the Virginia Board of Dentistry, who has contracted with the dental plan organization or with an entity acting on behalf of the dental plan organization to provide dental services to the enrollees. A dental plan organization may, but is not required to, utilize plan dentists.

"Plan dentist contract" means a contract between the dental plan organization or an entity acting on behalf of the dental plan organization and a plan dentist.

"Subscriber" means (i) with respect to group dental benefit contracts, the person who is covered by the contract, other than as a dependent, by satisfying the eligibility requirements of the group, and (ii) with respect to individual dental benefit contracts, the individual who obtains coverage of the individual only or the individual and dependents of the individual.

2004, c. 668.

A. No person shall establish or operate a dental plan organization in the Commonwealth without first obtaining a license from the Commission. Any business entity, which is neither an individual nor a sole proprietorship, may apply to the Commission for a license to establish and operate a dental plan organization in compliance with this chapter.

B. Each application for a license shall be verified by an officer or authorized representative of the applicant, shall be in a form prescribed by the Commission, and shall set forth or be accompanied by the following:

1. A copy of the basic organizational documents of the applicant including, but not limited to, the articles of incorporation, articles of association, partnership agreement, trust agreement, or other applicable documents, and all amendments to those documents;

2. A copy of the bylaws, rules, and regulations, or any similar document regulating the conduct of the internal affairs of the applicant;

3. A list of the name, address, official position, and biographical information on forms acceptable to the Commission of each member of the governing body and any person with authority to manage or establish policy; and a full disclosure in the application of (i) any financial interest between such person or any dentist, organization, or corporation owned or controlled by such person and the dental plan organization and (ii) the extent and nature of the financial arrangements between such person and the dental plan organization;

4. A copy of any contract made or to be made between any dentist, sponsor, or organizer of the dental plan organization, or persons listed in subdivision 3 and the applicant;

5. A copy of the evidence of coverage form to be issued to subscribers and the dental benefit contract to be issued to contract holders;

6. A copy of any group contract form that is to be issued to employers, unions, trustees, or other organizations. All group contracts shall set forth the right of subscribers to convert their coverages to an individual contract issued by the dental plan organization;

7. A financial statement or statements and any reports, certificates, or other documents the Commission considers necessary to secure a full and accurate knowledge of the applicant's affairs and financial condition;

8. A complete description of the dental plan organization and its method of operation, including (i) the method of marketing the plan, (ii) a statement regarding the sources of working capital as well as any other sources of funding, and (iii) a description of any insurance, reinsurance, or alternative coverage arrangements proposed, including excess insurance or stop loss insurance;

9. A financial feasibility plan that includes, but is not limited to, (i) detailed enrollment projections, (ii) the methodology for determining premium rates to be charged during at least the first three years of operations and extending one year beyond the anticipated break-even point certified by an actuary, and (iii) a projection, along with material assumptions, of balance sheets, cash flow statements showing capital expenditures and purchase and sale of investments, and income statements on a quarterly basis for at least three years and extending one year beyond the anticipated break-even point; and

10. Any other information the Commission may require to make the determinations required pursuant to § 38.2-6103.

2004, c. 668.

A. The Commission shall issue a license to a dental plan organization after the filing of a complete application and payment of a $500 nonrefundable application fee, if the Commission is satisfied that:

1. The persons who are responsible for conducting the affairs of the dental plan organization are trustworthy and capable of providing, arranging for, or paying benefits for the services offered by its dental plan;

2. The dental plan organization is financially responsible and may reasonably be expected to meet its obligations to enrollees. In making this determination, the Commission shall consider, among other things, the following:

a. The financial statements of the dental plan organization;

b. The adequacy of working capital;

c. Any contracts with plan dentists;

d. The deposit of acceptable securities, which shall be in an amount of no less than $50,000; and

e. The applicant's minimum capital and surplus, which shall be the greater of $750,000 or 45 days of anticipated operating expenses and incurred claims expenses.

3. Nothing in the method of operation is contrary to the public interest, as shown in the information submitted pursuant to § 38.2-6102 or Chapter 58 (§ 38.2-5800 et seq.) of this title or by independent investigation.

B. A licensed dental plan organization shall have and maintain at all times the minimum capital and surplus described in subdivision A 2 e. The licensee's capital and surplus shall be subject also to the risk-based capital requirements of Chapter 55 (§ 38.2-5500 et seq.) of this title.

1. If the Commission finds that the minimum capital and surplus of a domestic dental plan organization is impaired, the Commission shall issue an order requiring the dental plan organization to eliminate the impairment within a period not exceeding 90 days. The Commission may by order served upon the dental plan organization prohibit the dental plan organization from issuing any new dental benefit contracts while the impairment exists. If at the expiration of the designated period the dental plan organization has not satisfied the Commission that the impairment has been eliminated, an order for the rehabilitation or liquidation of the dental plan organization may be entered as provided in Chapter 15 (§ 38.2-1500 et seq.) of this title.

2. If the Commission finds an impairment of the minimum capital and surplus of any foreign dental plan organization, the Commission may order the dental plan organization to eliminate the impairment. The Commission may, by order served upon the dental plan organization, prohibit the dental plan organization from issuing any new dental benefit contracts while the impairment exists. If the dental plan organization fails to comply with the Commission's order within a period of not more than 90 days, the Commission may suspend or revoke the license of the dental plan organization.

2004, c. 668.

A. Each dental plan organization organized under this chapter shall obtain an annual renewal of its license from the Commission by July 1 of each year. The Commission may refuse to renew the license of any dental plan organization or may renew the license, subject to any restrictions considered appropriate by the Commission, if it finds an impairment of the minimum capital and surplus or that the dental plan organization has not satisfied all of the conditions set forth in subsection A of § 38.2-6103.

B. The Commission shall not fail or refuse to renew the license of any dental plan organization without first giving the dental plan organization 10 days' notice of its intention not to renew the license and giving it an opportunity to be heard and to introduce evidence on its behalf. The hearing may be informal and the required notice may be waived by the Commission and the dental plan organization.

2004, c. 668.

A. Each dental benefit contract shall contain the following provisions:

1. An effective date of the contract;

2. A provision describing the payment of required subscription fees or premiums;

3. A grace period provision that complies with § 38.2-6107;

4. For group dental benefit contracts, the eligibility requirements and effective date of coverage for subscribers of the group and their dependents;

5. A provision describing the benefits available under the dental benefit contract;

6. A provision describing the copayments and deductibles for which the enrollee is responsible or the fixed indemnity benefits, if any;

7. A provision describing the service area, if applicable;

8. If a dental plan organization provides benefits only within a stated service area, a provision providing for emergency dental services outside the service area, with the term "emergency" including care to alleviate acute pain;

9. A provision indicating that if a plan dentist refers the enrollee to a specialist who is not a plan dentist for dental services that are covered under the dental benefit contract, the dental plan organization shall be responsible for payment of the specialist's charges to the extent the charges exceed the copayment specified in the dental benefit contract;

10. A provision that reads substantially as follows, if the contract requires use of a plan dentist:

"If during the term of this contract none of the plan dentists can render necessary care and treatment to the enrollee due to circumstances not reasonably within the control of the dental plan organization, such as complete or partial destruction of facilities, war, riot, civil insurrection, labor disputes, or the disability of a significant number of the plan dentists, then the enrollee may seek treatment from an independent licensed dentist of his own choosing. The dental plan organization will pay the enrollee for the expenses incurred for the dental services with the following limitations: The dental plan organization will pay the enrollee for services that are listed in the patient charge schedule as "No Charge," to the extent that such fees are reasonable and customary for dentists in the same geographic area; the dental plan organization will also pay the enrollee for those services listed in the contract for which there is a copayment, to the extent that the reasonable and customary fees for such services exceed the copayment for such services as set forth in the contract. The enrollee may be required to give written proof of loss.";

11. A provision setting out the terms under which coverage will terminate; and

12. A provision setting out a grievance procedure that specifies the time period in which the dental plan organization shall initially respond to an enrollee's grievance, with the time period not exceeding 20 days from the date the grievance is filed with the dental plan organization.

B. Each dental benefit contract shall also have provisions related to extension of benefits that specify:

1. If an enrollee's coverage terminates, an extension of benefits shall be provided for any treatment in progress at the time of termination, provided the treatment requires two or more visits to the dentist's office on separate days as certified by the treating dentist.

2. The extension of benefits shall be, at a minimum, for all types of dental care other than orthodontics, until the completion of the procedure.

3. For orthodontics, the extension of benefits will be at least 60 days if the orthodontist has agreed to or is receiving monthly payments when coverage terminates, or if the orthodontist has agreed to accept or is receiving payments on a quarterly basis, to the end of the quarter in progress or 60 days, whichever is longer.

4. An extension of benefits is not required if termination is due solely to the failure of the enrollee to pay the subscription fee or premium when the enrollee is otherwise eligible to continue coverage under the dental benefit contract.

2004, c. 668.

Dental benefit contracts may contain the following provisions:

1. A provision including the dental plan organization's intention to charge a specified missed appointment fee. The fee shall be reasonable in relation to the nature of the procedure for which the missed appointment had been made. Neither the plan dentist nor the dental plan organization may charge a missed appointment fee unless this provision appears in the dental benefit contract. For purposes of this section, the term "missed appointment" means an appointment for which advance cancellation of at least 24 hours was not provided.

2. A provision including the dental plan organization's ability to increase premiums or subscription fees, with this provision indicating that these fees may not be increased unless:

a. The contract holder has been given written notice at least 60 days before the effective date of the increase; and

b. In the case of:

(1) An individual contract, present rates under the contract have not been changed for at least 12 months, or

(2) A group contract, present rates under the contract have been in effect for at least 12 months.

3. A provision including the dental plan organization's intention to impose a financial penalty on an enrollee for voluntarily withdrawing from the dental plan during the first year of coverage, which penalty may not:

a. Be charged if the enrollee withdraws from the dental plan after being covered for at least 12 months; or

b. Exceed the usual, customary, and reasonable charge for services received reduced by the sum of the subscription fees paid by or for the enrollee and any copayments paid by or for the enrollee.

4. A provision including the dental plan organization's ability to increase the patient charge schedule, with the provision indicating that the increase may not be effective unless the:

a. Present schedule under the contract has been in effect for at least 12 months; and

b. Contract holder has been given written notice of the increase at least 60 days before the effective date of the increase.

5. A provision including the dental plan organization's rights if an enrollee refuses to follow a particular course of treatment. The dental plan organization may not terminate the membership of an enrollee for refusal to follow a recommended course of treatment for a particular condition. The provision may indicate that the dental plan organization may refuse to provide any further benefits for the particular condition if the enrollee refuses to accept a recommended course of treatment.

6. A provision including the dental plan organization's rights if an enrollee fraudulently uses his membership card or knowingly permits his membership card to be used by others. The dental plan organization may terminate an enrollee's coverage if the enrollee fraudulently uses his membership card or knowingly permits his membership card to be used by others. The dental plan organization may not terminate coverage for an entire family because a dependent fraudulently uses the membership card. In this instance, only the dependent's coverage may terminate.

7. A provision specifying that the dental plan organization may terminate an enrollee's coverage if the enrollee is unable to maintain a satisfactory dentist-patient relationship with a plan dentist, provided, however:

a. Before terminating the enrollee's coverage, the dental plan organization shall permit the enrollee to change primary dentists at least once;

b. The enrollee shall be given written notice of the termination at least 30 days before the termination of the enrollee's membership.

8. If the contract provides coverage for dependent children, the contract shall also contain the following provision:

"Notwithstanding any limiting age stated in the contract, any unmarried child covered under the contract as a dependent of an enrollee who is chiefly dependent for support upon the enrollee, and who, at the time of reaching the limiting age, is incapable of self-support because of mental or physical incapacity that commenced prior to the child's attaining the limiting age, shall continue to be covered under the contract while remaining so dependent, unmarried, and mentally or physically incapacitated, until the coverage on the enrollee upon whom the child is dependent terminates."

2004, c. 668.

The contract holder shall be given a 31-day grace period for the payment of any premium falling due after the first premium during which coverage remains in effect. If payment is not received within the 31 days, coverage may be cancelled after the thirty-first day and the contract holder may be held liable for the payment of the premium for the period of time coverage remained in effect during the grace period.

2004, c. 668.

A. Each contract with a plan dentist shall contain the following provisions:

1. A hold harmless clause that satisfies the requirements of subdivision C 9 of § 38.2-5805.

2. A provision specifying when the contract becomes effective.

3. A provision specifying the date the contract terminates.

4. A provision specifying the renewal terms.

5. Provisions incorporating the rights, remedies and obligations applicable to providers and dental plan organizations set forth in §§ 38.2-3407.1, 38.2-3407.10, 38.2-3407.15, and 38.2-5805.

B. A dental plan organization that offers or administers a plan under which preferred provider policies or contracts are issued shall comply with the requirements of § 38.2-3407 in contracting with dentists for services in connection with the preferred provider policies or contracts.

C. All dental plan organizations shall comply with the provisions of § 38.2-3407.13 relating to assignments of benefits by subscribers and enrollees.

2004, c. 668.

The dental plan organization:

1. Shall provide a written dental benefit contract to each group contract holder within 15 days of acceptance of the group's application by the dental plan organization;

2. Shall provide a written evidence of coverage to each individual covered under a group dental benefit contract within 15 days of acceptance of the group's application by the dental plan organization; and

3. Shall provide a written dental benefit contract to each individual who applies for individual dental coverage within 15 days of acceptance of the individual's application by the dental plan organization.

2004, c. 668.

A. The filing with the Commission of any dental benefit contract or rider or endorsement by a dental plan organization shall be accompanied by the filing of premium rates or subscription fees.

B. A subsequent change in premium rates or subscription fees shall be filed with supporting data at least 30 days before the change is proposed to become effective.

2004, c. 668.

A. The Commission shall examine the affairs of each dental plan organization as provided for in § 38.2-1317.

B. Instead of making its own examination, the Commission may accept the report of an examination of a foreign dental plan organization certified by the insurance supervisory official, similar regulatory agency, or the state health commissioner of another state.

C. The Commission may coordinate its examinations with the State Health Commissioner to ensure an appropriate level of regulatory oversight and to avoid any undue duplication of effort or regulation.

2004, c. 668.

Dental benefit contracts may be solicited only through health insurance agents and limited lines life and health agents licensed in accordance with Chapter 18 (§ 38.2-1800 et seq.) of this title. Home office salaried officers whose principal duties and responsibilities do not include the negotiation or solicitation of dental benefit contracts shall not be required to be licensed.

2004, c. 668.

A. Except to the extent that such application would be inconsistent with any provision of this chapter, the provisions of Chapter 5 (§ 32.1-123 et seq.) of Title 32.1 and of other chapters of this title, and regulations promulgated thereunder, that are applicable to (i) an insurer licensed pursuant to § 38.2-1024, (ii) a carrier as defined in § 38.2-3407.10, (iii) a health plan as defined in § 38.2-3407.15, or (iv) a health carrier or managed care health insurance plan as defined in § 38.2-5800, shall apply to dental plan organizations and the provision of dental services on behalf of dental plan organizations, as if such provisions specifically stated that they apply to dental plan organizations and the provision of dental services on behalf of dental plan organizations, notwithstanding that such other provisions do not refer to dental plan organizations or the provision of dental services on behalf of dental plan organizations.

B. Any reference in this chapter to specific provisions of any other chapter of this title or of any other title shall not limit the applicability of subsection A.

2004, c. 668.