NADP and ADA Achieve Loss Ratio Compromise at NCOIL

Model legislation offers middle ground solution on loss ratios

1/26/24

DALLAS, Texas – – The National Association of Dental Plans (NADP) has successfully negotiated with the American Dental Association (ADA) to create compromise language for dental medical loss ratio model legislation, which was adopted today by the National Conference of Insurance Legislators (NCOIL).

In a joint statement published Jan. 23, NADP and the ADA acknowledged and thanked NCOIL for its leadership and guidance in reaching this compromise. The model legislation requires dental insurers to report loss ratio information and, if adopted by states, provides insurance commissioners an opportunity to identify loss ratio outliers and work with them to remediate low ratios.

“NADP appreciates NCOIL’s leadership in achieving this compromise model legislation for loss ratios. The result is proof that when acting in good faith with the ADA, that two organizations with different views can reach a reasonable compromise,” remarked NADP Executive Director Mike Adelberg.

At least five states have adopted loss ratio reporting or outlier remediation based on the existing state dental market. The NCOIL model legislation takes a similar approach. One state, Massachusetts, arbitrarily set a loss ratio for dental plans at the same level that exists for medical plans that operate on a completely different scale and delivery model. This unfortunate approach has forced five dental plans to withdraw from the small employer insurance market in that state.