Legislature(1993 - 1994)
03/18/1994 01:15 PM JUD
* first hearing in first committee of referral
= bill was previously heard/scheduled
= bill was previously heard/scheduled
HB 472 - REFERRALS INVOLVING DENTAL SERVICES REP. GARY L. DAVIS, Prime Sponsor of HB 472, addressed the committee. He said, "HB 472 will prohibit the receipt of compensation by dentists for referring a person to another dentist or dental practice. The American Dental Association code of ethics forbids dentists from profiting from referrals. This legislation codifies the ethical concern related to referrals. "Section 2, the receipt of compensation by a person or advertisement referring a dental service, is prohibited unless the compensation for referral is disclosed at the time of referral. This legislation will help ensure that patients are being referred to a dentist or dental practice as a result of their quality service. "In simple terms, this is simply codifying a section in the American Dental Association's Code of Ethics into statute. There is some testimony. I believe Julie Robinson should be on teleconference. I believe she is President of the Alaska Dental Society. She will go into detail as to why the Association feels this ethical procedure is confronting problems to the degree that they feel it needs to be codified in statute. So, I think she will probably have the most valid testimony. And I'll answer questions, if I may." CHAIRMAN PORTER said he saw no immediate questions, but invited Rep. Davis to remain for questions that might arise. Number 087 DR. JULIE ROBINSON, President, Alaska Dental Society, testified via teleconference from Anchorage on behalf of HB 472. She thanked the committee for the opportunity to address them, and particularly thanked Rep. Davis and his staff. Dr. Robinson said that HB 272 was easily understood and to the point. She related the circumstances of its origins, which was primarily a response to misleading advertising by so-called referral services purporting to guide individuals towards appropriate dental practitioners in good standing with the Alaska Dental Association. In fact, the only referees were a few dental practitioners who were paying in to the referral "services" towards whom calls would be channeled regardless of the type of dental services required; the standing of these practitioners, moreover, had not been determined by the referrers. Dr. Robinson described the experiences of consumers seeking appropriate dental care and receiving faulty and misleading information. DR. ROBINSON concluded, "The benefits of advertising depend on reliability and accuracy. This type of ad is deceptive and faulty. Because the public is easily deceived by this sort of advertising, and generally has a lack of sophistication regarding dental services, we feel that the agency should disclose to the public that the dentist receiving the referral has paid a fee for this service. The dentists also feel that it is important to avoid misleading the public about services we provide." She said HB 472 would apply the Dental Society's Code of Ethics regarding advertising and fee splitting and noted that other states have enacted or are considering similar legislation. Number 171 REP. JAMES focused on the extent of the legislation, asking if it would ban all advertising by dental practitioners. Number 173 DR. ROBINSON replied that it would not; in fact, there were many perfectly legal advertisements for dentists currently in the Yellow Pages. She explained that HB 472 would regulate only dental referral services for dentists. She noted that the paid referral services limited inclusion in any particular area to certain practitioners who paid large fees. Number 216 REP. PHILLIPS asked if there were other, open-ended referral services, and wondered how to determine if they were operating in a lawful fashion. DR. ROBINSON described the referral service of the Alaska Dental Society, which provides several referral options for every caller, as an example of a legitimate service. Number 252 REP. NORDLUND posed a question regarding Section 2 of HB 472, which makes referral fees illegal. He asked if that meant that a dentist to whom a patient came for examination could not charge that patient a fee for services if the dentist, having determined that he was not the appropriate person for the service, referred the patient on to another practitioner. DR. ROBINSON explained that this was not so; the section meant that one dentist could not receive a fee from another dentist for referring a patient. REP. NORDLUND, DR. ROBINSON, CHAIRMAN PORTER and REP. DAVIS discussed the language and Section 2 and agreed that it was acceptably clear. CHAIRMAN PORTER observed, "In its most negative form, we're prohibiting kickbacks." He asked if there were further questions. REP. JAMES expressed discomfort with the legislature policing the ethics of the members of the Board of Dental Examiners, an entity which might be considered to be capable of self-policing. She cautioned against an excess of protectionism. REP. DAVIS responded to this concern by characterizing the legislation as forward-looking; a way of obviating problems such as those, for example, which might be coming into being through the plethora of 800 and 900 telephone numbers which provide the means for referral businesses to operate without familiarity with the professional ethics involved. REP. JAMES reiterated her concerns and remarked, "I feel it's really improper for the state to go out and try to police everybody's ethics. I think that we have a hard enough time policing our own." Number 318 REP. GREEN expressed, in counterpoint, his concerns over the ramifications of untrained persons in paid referral services making recommendations. REP. JAMES responded that the guilty party would not be the referral system, but rather the participating dentist. CHAIRMAN PORTER asked Dr. Robinson to tell the committee if the board of the Alaska Dental Society was capable now of doing this policing without the statute. DR. ROBINSON believed that it was not so capable, given its current burdens. CHAIRMAN PORTER asked, "Is there any other discussion?" REP. PHILLIPS said, "I would move that we move HB 472 out of committee with individual recommendations and zero fiscal note." CHAIRMAN PORTER stated, "We have a motion to move the bill. Is there a discussion? Is there objection?" There being no objection, HB 472 was adopted and moved out of committee.