Heard the saying: “If you’re a hammer, everything looks like a nail”?
Unlike Plan Forward, for many vendors every dental membership is a discount plan that must be administered by a Discount Plan Organization. Here, we’ll explain why this is an overly simplified, black-and-white view of the world.
In reality, in the world of dental membership & discount plans, there are nuanced regulatory regimes. It is not one size fits all, and it’s important to understand the different regimes as well as the states’ regulatory intent in order to know the boundaries. Note this is not legal advice.
The key question that state regulators address with regulation is: Are membership or discount plans a form of insurance? If they are, then the practice or group must comply with state insurance laws. If not, these plans are generally treated as a contractual relationship governed by contract law and consumer protection statutes.
States have taken 2 main approaches:
1. Direct Primary Care (DPC)
In this model, patients pay the practice a periodic fee directly in exchange for access to care or discounted services. The relationship is defined by a contract between the patient and the provider.
Over 20 states (ADA list here) have enacted DPC-specific safe harbor laws that explicitly state these agreements are not insurance, provided certain conditions are met (e.g., clear disclosures, no risk-sharing, etc.). In states without specific statutes, general contract law and consumer protection statutes apply.
2. Discount Medical Plan Organization (DMPO)
Starting with Florida in 2004, some states created a distinct regulatory category for discount plans. These laws require the entity administering the plan (the DMPO) to register or obtain a license with the state’s insurance department. Requirements typically include registration or licensure, mandatory disclosures, complaint procedures, financial requirements, and network transparency.
In this model, the state insurance department has explicit enforcement authority including fines, license revocation, and cease-and-desist orders. Today, roughly 24 states require some form of DMPO licensure or registration.
The reality is messy.
While this blog clearly lays out two regulatory models, many states have both DPC & DMPO laws, some have neither, and some have only one. Furthermore, some DMPO statutes explicitly exempt dental practices that offer discounts to their own patients. Here are just two examples:
– Florida (Section 636.204(6)): “This part does not require a provider who provides discounts to his or her own patients to obtain and maintain a license as a discount plan organization.”
– South Carolina (Section 37-17-20(C)): “This section does not require a provider who provides discounts to his or her own patients to obtain and maintain a license pursuant to this chapter as a discount medical plan organization.“
Why does this matter?
Each state is different & has different requirements. Many of our vendor colleagues will have you believe that state compliance is black & white, and that everything fits neatly into one regulatory regime. It need not.
Plan Forward’s approach is unique – we’ve built a platform that allows for all the nuance. If you’re a group with practices in DPC & DMPO states, we manage compliance within both regulatory regimes, on a single platform. Membership/discount plans are not one-size-fits-all; providers prefer different structures, and we can accommodate their individual preferences.
What truly sets us apart is how we make it simple for dental practices and groups to launch and manage high-performing membership plans across multiple states, without getting buried in regulatory complexity.
Plan Forward frees you to focus on growth, patient loyalty, and practice profitability.
