Legislature(1993 - 1994)
03/01/1994 03:00 PM HES
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
HB 472 - REFERRALS INVOLVING DENTAL SERVICES CHAIR TOOHEY asked Rep. G. Davis to address the bill. Number 303 REP. GARY DAVIS stated that HB 472 will prohibit the receipt of compensation by a dentist for referring a person to another dentist or dental practice. He further stated that the receipt of compensation by a person or advertisement that refers a dental service is prohibited, unless the compensation for referral is disclosed at the time of referral. He maintained that the proposal would ensure that patients would be referred to a dentist or a dental practice as a result of the quality of service. He said the bill was before the committee as a result of the American Dental Association, Principles of Ethics and Professional Code of Conduct. He said that it is against their code to solicit patients in any form through referrals. He stated that the legislation would put some of the American Dental Association's ethics in statute. CHAIR TOOHEY asked for questions. Number 348 REP. VEZEY asked why the committee was attempting to codify the ethical standards of any professional organization. REP. G. DAVIS replied that the initial attempt was made through a resolution, but Legal Services felt there was room in statute for the provisions. He also said Mr. Sam Kito from the Alaskan Dental Association was present to answer questions. REP. BUNDE asked if the legislation was inspired by any specific cases concerning unethical "kickbacks." Number 338 REP. G. DAVIS said the request was based specifically on the 1-800 number agencies that advertise for referrals. CHAIR TOOHEY stated that Dr. Dan Pitts from Soldotna was on line to answer questions. Number 407 DR. DAN PITTS, Former President, Alaska Dental Society, testified via offnet from Soldotna in support of HB 472. He stated that the emphasis of the bill is to protect the public. He stated that the code of ethics indicates that it is unethical for any dentist to make payment to another person or entity for referral of a patient for professional services. He said commercial referral agencies violate that code. He said the advertising is false and misleading. He explained that most commercial referral services have had no contact with the Alaska Dental Society to check the credentials of the dentists they are referring. He felt that practice to be very misleading. He also noted that only a few dentists are getting referrals from the service and that the dentists are paying the commercial referral services for the referrals. He reiterated that this practice is unprofessional and unethical. He said the legislation is in line with the Alaska Dental Association's principles of ethics and professional conduct. Number 497 REP. BUNDE related a situation whereby dentists who utilize the commercial referral service could possibly pass a patient around for various dental work to be done only for the goal of padding their bills. He indicated that type of situation to be the only problem he could see. He further stated that the notion of the referral service is just a commercial entity that is selling a product for dentists. He felt if the dentists are not getting their money's worth, the dentist should stop buying the product, hence the services to go out of business. He saw the issue as two separate problems. DR. PITTS said the thrust of the bill is to have the commercial referral service disclose to the patient that they are paid by dentists for these referrals. He said patients are misled because they believe the commercial referral service is an official referral service that gives an objective referral. He stated that the issue is a nationwide problem and that other states have legislation that prohibits this particular practice. Number 552 REP. BUNDE clarified that the legislation would mandate that a commercial referral service disclose within conversation with a potential referral patient that the referral agency is paid by dentists for their services. DR. PITTS agreed. REP. G. DAVIS said that the legislation would include additional review by the dental boards and indicated the provision on page 2, line 1. Number 585 REP. BUNDE cited the zero fiscal note and asked if the professional dental board would be the official policing agency. He further questioned if a complaint could be brought to the board if disclosure is not made. REP. G. DAVIS said that the board already has the responsibility of oversight. REP. BUNDE said that it is also the board's responsibility to decide on ethics. He said it would be a breach of dental ethics to not disclose. He then said that the referral services are not dentists, so the board cannot fine someone who is not a dentist for violation of dental ethics. REP. G. DAVIS deferred to Dr. Pitts. DR. PITTS assumed that the legislation would make it clear as to how the commercial referral services would have to operate. He reiterated the thrust of the proposal to be that of disclosure to the patient. REP. BUNDE clarified that kickbacks between two dentists is a violation of dental ethics that could be brought up before the dental board. DR. PITTS said yes. REP. BUNDE asserted that the board has no way of addressing the ethics issue of commercial referral services because they are not dentists. He then asked if there were any services that were run by dentists. Number 646 DR. PITTS said no referral services are run by dentists. He felt for a commercial referral service to refer a patient would be "pretty close to practicing dentistry." REP. BUNDE said the commercial referral agencies are currently doing just that. He commented that the issue could also be raised if he was to tell his friends that he needs a route canal and his friends suggest a dentist. DR. PITTS said that a commercial entity would be practicing dentistry by referring the patient to a dentist. REP. BUNDE stated that the difference may be his friends would not get paid for the referral. CHAIR TOOHEY asked for further questions. Number 674 REP. VEZEY asked Dr. Pitts if the adherence to the professional ethics standards is a condition of licensure. DR. PITTS said yes. He said the proposal focuses on the commercial referral services, not on dentists. REP. VEZEY indicated that under Title 836.315 there is no provision made for the adherence to the professional ethics standards as being a requirement of licensure or grounds for revocation. DR. PITTS said the a definition of the board's purpose is to pass judgement on the ethical standards of the profession. Number 724 REP. VEZEY said he felt the added wording was really unnecessary, and further stated that he thinks the board does not have the authority to revoke a license for unethical behavior. He said he knew the board to have the authority to revoke licensure on the grounds of professional incompetence, but not for unethical behavior. REP. BUNDE interjected and said the sponsor statement indicates that the Board of Dental Examiners is charged with developing ethics policy. REP. VEZEY said the sponsor statement is not codified in law. REP. BUNDE agreed that Rep. Vezey brought up an interesting point. REP. VEZEY suggested that Dr. Pitts look at the board's statutory authority, because he did not believe the board has any authority in enforcing ethics. He stated that the board only had authority to enforce professional standards. Number 759 DR. PITTS questioned if professional standards are the same as ethics. REP. VEZEY stated that professional competence implies technical competence. DR. PITTS reiterated that the bill specifically addresses disclosure by the commercial referral services. REP. VEZEY said Dr. Pitts was referring to Section 2 that amends Title 45, which is a chapter on unfair trade practices. He further stated that the section dealing with the authority of the board of licensing is in Title 8. He again stated that he did not believe the board has the authority to revoke a license for unethical behavior. He suggested Dr. Pitts look into the matter. DR. PITTS said that he is not a board member and would have to talk with a board member. He said he had always assumed that the dental board has the authority to revoke a license for unethical behavior. CHAIR TOOHEY asked the pleasure of the committee. REP. VEZEY said he answered his own question. Number 829 CHAIR TOOHEY asked again the pleasure of the committee. REP. VEZEY made a motion to pass HB 472 out of committee with individual recommendations. CHAIR TOOHEY, hearing no objections, declared HB 472 so moved. Seeing no further business before the committee CHAIR TOOHEY ADJOURNED the meeting at 4:15 p.m.