May 2020 Volume LV Number 3


Legislative and Regulatory Update

September 2016 Volume LI Number 5

Legislative and Regulatory Update

Unless otherwise noted, for further information on any of these issues, please contact Chief Operating Officer and General Counsel C. Scott Litch at (312) 337-2169 or


The AAPD Applauds Treasury’s Proposed Rule on an ACA Dental Premium Tax Credit

The Treasury Department and IRS released on July 8, 2016, proposed regulations relating to premium tax credits under the Affordable Care Act. This included a rule clarifying the inclusion of subsidies for stand-alone pediatric dental plans, as part of the premium tax credit, for plans purchased in a Health Insurance Ex- change. This is a positive victory for children because it strengthens pediatric oral health coverage as an essential health benefit under the ACA. The AAPD joined with the American Dental Association, Children’s Dental Health Project, Delta Dental Plans Association, and National Association of Dental Plans (NADP) in expressing support for this proposal.


The treatment of premiums for stand-alone pediatric dental plans as related to tax credit support for low income families has been an issue of concern under the ACA. Under the ACA, the premium tax credit is applied to the cost of a plan that covers "essential health benefits," which includes pediatric oral health coverage. However, if the benchmark plan does not include pediatric dental benefits, a fam- ily’s federal tax credit will not include any subsidies for pediatric dental coverage. Since May 2013, a dental coalition formed by NADP found that numerous states did not include pediatric dental coverage within medical benchmark plans. With the help of Senator Debbie Stabe- now (D-Michigan), this dental coalition urged the Treasury to equally apply the Advanced Premium Tax Credits (APTC) under the ACA to pediatric dental benefits when they are purchased as a stand-alone dental plan. The AAPD was a signatory on a letter to the Treasury Department in 2014 requesting this change, to include any separate dental premium cost under the calculation of a tax subsidy for low income families.

Impact of Regulation

In this latest decision, the Treasury Department clarified that the benchmark calculation will include pediatric dental care regardless of whether the benefit is embedded in a medical policy or is offered as a stand-alone plan. The cost of pediatric dental coverage will be accounted for in determining the premium tax credit for families with children, just like other essential health benefits.

This proposed regulation will take affect for taxable years after Dece. 31, 2018. Below is the clarification for benchmark plans:

"In constructing this ranking, the premium for the lowest- cost silver plan that does not include pediatric dental benefits is added to the premium allocable to pediatric dental benefits for the lowest cost stand-alone dental plan, and similarly, the premium for the second lowest-cost silver plan that does not include pediatric dental benefits is added to the premium allocable to pediatric dental benefits for the second lowest-cost stand-alone dental plan. The second lowest-cost amount from this combined ranking is the tax- payer’s applicable benchmark plan premium."1

This ruling ensures that the APTC applies to all of the ten Es- sential Health Benefits outlined by the ACA and that more families will have access to affordable dental care for their children under this regulation. As Senator Stabenow notes:

"For young children, early dental care is especially impor- tant and this decision will help make dental coverage more affordable for families in Michigan and across the country."

1 Federal Register, Vol. 81 No. 131, 81 FR 44566. July 8, 2016.

$10 Million for Pediatric Dentistry Training Included in FY 2017 House Appropriations Bill

As reported in the July PDT, in June the Senate Appropriations Committee approved a FY2017 funding bill that included $10 mil- lion for pediatric dentistry training. This is the AAPD’s top FY 2017 federal appropriations priority. Favorable report language was also included. More good news comes from the mid-July House Appro- priations Committee approval of the same amount—$10 million. Favorable Report language mirrored that of the Senate bill, based on AAPD’s recommendation:

"HRSA is directed to provide continuation funding for pred- octoral and postdoctoral training grants initially awarded in fiscal year 2015 and continuation funding for section 748 Dental Faculty Loan Repayment grants initially awarded in fiscal year 2016."


The authority to fund pediatric dentistry residency training under Title VII was first enacted under the Health Professions Education Partnership of 1998. This expanded the existing General Dentistry training authority by providing "start-up funds" to increase Pediatric Dentistry positions at existing programs or initiate new programs.

Under the 2010 Affordable Care Act, Title VII was expanded to create a primary care dental funding cluster under Section 748 of the Public Health Service Act. Authority was broadened to allow use of funds for faculty development, predoctoral training, and faculty loan repayment. The AAPD has long advocated for this latter initiative due to the significant difficulties in recruiting qualified individuals to fill faculty positions.


This outcome is another positive step towards meeting the AAPD’s final FY 2017 federal appropriations goals. However, final FY 2017 funding decisions are not expected to be finalized by Congress until late this year after the elections.

The AAPD especially thanks Congressional Liaison Heber Sim- mons Jr. and Mike Gilliland and Kate McAuliffe at Hogan Lovells in Washington D.C. for their efforts on these appropriations issues. The AAPD also thanks all those members who participated in the 2016 Public Policy Advocacy Conference in Washington, D.C. where they advocated for this funding. The AAPD also acknowledges our joint efforts with the ADA, ADEA, and AADR.


Actions in Connecticut Medicaid Dental Program


In 2015 in the Connecticut Medicaid dental audit case of Bridge- port Dental, LLC vs. Commissioner of Social Services, the AAPD along with the Connecticut State Dental Association, Connecticut Society of Pediatric Dentistry, Connecticut Society of Oral and Maxillofacial Surgeons, American Dental Association, Walgreen Co., and ATG Connecticut filed an amici curiae (friends of the court) brief. This brief raised concerns about children’s access to oral health care under Medicaid being negatively impacted by unfair and unreason- able audit procedures. Widespread use of audit procedures absent sound statistical principles could result in inaccurately resembled overpayments made to the provider and could impose a substantial financial burden on those Medicaid providers. The goal of the brief was to educate the three Appellate judges about the flaws in the De- partment of Social Service’s extrapolation methodology and to ensure that the court did not accept the dental auditing practice as valid. For more background see brief_in_connecticut_medicaid_dental_audit_case/.

On May 24, 2016, the Connecticut Appellate Court ruled against the plaintiff-dentist and affirmed the trial court’s rejection of a Bridgeport dentist challenge to the Medicaid audit. The court said that the dentist failed to submit the documentation necessary to rebut the agency’s findings and raised certain issues in his written response. This negative ruling for the dentist illustrates that in a Medicaid audit case a dentist should work with an attorney early in the process to ensure that all appropriate arguments and records are compiled when responding to the Medicaid agency or challenging an agency finding in court.

Since the dentist failed to properly challenge the specific methodol- ogy used during the audit, the only legal question raised was whether the Department of Social Services (DSS) was authorized to engage in extrapolation. The Appellate Court not surprisingly did uphold the DSS’s authority to extrapolate Medicaid overpayments. However, the Appellate Court did not say anything approving of the methodology used by the state audit agency. When the court upheld the DSS audit in the opinion, it only said that extrapolation was appropriate as a "general" matter. Thus, this case did not create a new precedent. This preserved the possibility of a successful challenge against the state’s dental auditing practices in a future court case, along the lines of arguments made in the amici brief.


The Connecticut State Budget passed during the 2016 legisla- tive session resulted in a five percent across the board reduction in children’s dental Medicaid reimbursement rates. Dr. Donna Balaski from the Department of Social Services provided an open letter to the members of the Connecticut State Dental Association (CSDA) regarding these cuts, and asked for the dental community to provide feedback on the impact the cuts will have on providing care to the Medicaid population.

Based on a request from the CSDA and the Connecticut Society of Pediatric Dentistry (CSPD), both the AAPD and ADA wrote letters in late June 2016, to the state Medicaid agency explaining that Connecti- cut has been a model for positive Medicaid dental reform but the pro- posed cuts would reverse this progress and result in worse oral health outcomes for children most in need. Over one hundred Connecticut dentists responded by writing letters and e-mailing the Department of Social Services in addition to our national organizations’ responses.

According to CSDA Executive Director Carol Dingeldey, the AAPD letter was very well-received by Medicaid program officials: "They LOVED your letter. Thanks so much for your help, on behalf of all of the dentists in Connecticut!"

Subsequent to receipt of these letters, on June 30, 2016, the Med- icaid program announced a delay in these cuts until Sept. 1, which will allow the CSDA to meet with agency officials prior to that date. The AAPD acknowledges the CSPD for alerting the AAPD to this issue and closely coordinating efforts with CSDA, thanks to chapter presi- dent Dr. Ira Greene and state Public Policy Advocate Dr. Doug Keck.

Copies of the letters are available on the AAPD website at http:// aid_cut/.

Click here for a PDF version of this article.