Bill
SB 1106
MI SB1106 requires health plans and nonprofit dental payers to offer at least one fee-free method that delivers 100% of the dentist's payment, with opt-out options.
Status and sponsor
- Introduced by Sen. Jeff Irwin (Senate Substitute S‑1). Substitute was reported favorably by committee and passed the Senate (12/12/2024). (Bill information also shows placement on second reading and further House consideration dates.)
- Applies to dental benefits policies delivered, issued for delivery, or renewed in Michigan after the bill’s effective date (see “Applicability & timeline”).
Purpose
- To ensure dentists (and dental therapists where specified) receive dental benefit payments or reimbursements from health plans or nonprofit dental care organizations without having to incur fees to access those funds.
Key provisions
- New section (proposed MCL 500.3406kk) requires any health plan or nonprofit dental care corporation that provides dental benefits to offer one or more payment or reimbursement methods that:
- deliver 100% of the amount payable to the dentist (no reduction of the payment amount), and
- do not impose a fee on the dentist to access the payment or reimbursement.
- The prohibition on fee-bearing payment methods does not apply to fees charged by the dentist’s (or dental therapist’s) own financial institution.
- If a dentist (or dental therapist, in some versions) elects to opt out of such a fee‑free payment method, that opt‑out remains in effect until the dentist opts back into the prior payment method or a new contract is executed.
- “Health plan” is the term defined in MCL 500.2006 and is interpreted to include: insurers providing health insurance policies (including some limited benefit policies) and multiple employer welfare arrangements (MEWAs) regulated under Chapter 70 — but payments under administrative‑service‑only (ASO) or cost‑plus arrangements are excluded.
Who is affected
- Directly: health plans (insurers and certain MEWAs), nonprofit dental care organizations (under PA 125 of 1963), dentists and dental therapists who participate in those plans.
- Indirectly: insurers’ payment/operations units and third‑party vendors that administer payments; patients are not directly affected by the payment method requirement.
Rationale
- Testimony cited instances where carriers paid providers via financial instruments (e.g., prepaid cards) that imposed processing/access fees on dentists. The bill responds to concerns that insurers should provide at least one fee‑free method to avoid shifting payment access costs to providers.
Applicability & timeline
- The bill applies to dental benefits policies delivered, issued for delivery, or renewed in Michigan after the act’s effective date. (Effective date is set upon enactment; refer to legislative tracking for final enactment/effective dates.)
Fiscal impact & enforcement
- Fiscal analyses vary: committee reports indicate no fiscal impact on state or local government; the House Fiscal Agency noted an indeterminate impact because enforcement under the Insurance Code could generate administrative costs and potential civil fine revenue.
- Enforcement mechanisms under the Insurance Code (through the Department of Insurance and Financial Services) and civil fines for Code violations may apply.
Notes
- The bill does not prohibit payors from offering alternative payment options that charge fees if the dentist voluntarily opts into them; it only requires at least one fee‑free option that pays 100% of the approved amount.
Compiled from official sources — confirm details with the bill’s official record.
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