SB 5322 — Concerning agreements between dentists and third parties that provide supportive services to dentists.

S-1597.2SUBSTITUTES-0667.1SENATE SENATE BILL 5322State of Washington65th Legislature2017 Regular SessionBy Senate Health Care (originally sponsored by Senators King, Frockt, Miloscia, Conway, Hobbs, and Becker)READBeckerRead FIRSTfirst TIMEtime 02/17/17.AN01/20/17. ACT Relating to patient safeguards in agreements between dentists and third parties that provide support services to dentists;

amendingReferred RCWto 18.32.675Committee on Health Care.AN ACT Relating to patient safeguards in agreements between dentists and 18.32.091;third parties that provide support services to dentists;

addingamending newRCW sections18.32.020, to18.32.655, chapterand 18.3218.32.091; RCW;

andadding creating a new section.BEsection IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:NEW SECTION.  Sec. 1.  The legislature finds that Washington law should allow dentists to determine,chapter based18.32 onRCW; their individual circumstances, which dental practice model would allow them to best serve the needs of their patients.

Dentistsand shouldcreating havenew thesections.BE optionIT toENACTED contractBY forTHE administrativeLEGISLATURE supportOF servicesTHE andSTATE dentistsOF shouldWASHINGTON:NEW alsoSECTION.  Sec. 1.  The belegislature ablefinds tothat leaseWashington reallaw orshould personalallow propertydentists into adetermine, mannerbased thaton meets their individual businesscircumstances, needs.which dental practice model would allow them to best serve the needs of their patients.

TheDentists legislatureshould intendshave that these contract decisions must not interfere with the independentoption clinicalto judgmentcontract offor theadministrative dentistsupport enteringservices the contract.Sec. 2.  RCW 18.32.675 and 2003dentists cshould 53also sbe 124able are each amended to readlease asreal follows:(1)or Nopersonal corporationproperty shallin practicea dentistrymanner orthat shallmeets solicittheir throughindividual itself,business orneeds.The itslegislature agent,further officers,finds employees,that directorsagreements orbetween trustees,dentists dentaland patronagethird forparties anyshould dentistshave orappropriate dentalsafeguards surgeonin employedplace byto anyprotect corporation:patients.

PROVIDED,A ThatUnited nothingStates containedsenate inreport thisfrom chapter2011 shallexposed prohibitsystematic afraud corporationand frompatient employingabuse awith dentistsome orof dentiststhe tocorporate render dental servicespractice tomodels. its employees:

PROVIDED,Additionally, FURTHER,the That2015 suchcorporate practice committee report by the Washington state dental servicesquality shallassurance becommission renderedraised atconcerns noabout costnondentists orasserting chargeinfluence toover thedental employees;treatment through employment contracts;

norproduction shall it apply to corporations or associationsprofit inincentives; which the dental services were originated and are being conducted upon a purely charitable basis for the worthy poor((, nor shall it apply to corporations or associations furnishing information or clerical services which can be furnished by persons not licensed to practice dentistry, to any person lawfully engaged in the practice of dentistry, when such dentist assumes full responsibility for such information and services)).(2) Nothing in this chapter precludes a person or entity not licensed by the commission from:(a) Ownership or leasehold of any assets used by a dental practice, including real property, furnishings, equipment, instruments, materials, supplies, and inventory, excluding dental records of patients;(b) Employing or contracting for the services of personnel other than licensed dentists, licensed dental hygienists, licensed expanded function dental auxiliaries, certified dental anesthesia assistants, and registered dental assistants;(c) Providing business support and management services to a dental practice, including as a sole provider of such services;

and(d)daily Receiving fees for the services in (a) through (c) of this subsection provided to a dental practice calculated as agreed to by the dental practice owner or owners.(3)weekly Anyquotas corporationfor violating this section is guilty of a gross misdemeanor, and each day that this chapter is violated shall be considered a separate offense.NEW SECTION.  Sec. 3.  A new section is added to chapter 18.32 RCW to read as follows:(1) A person that is not licensed under this chapter or an entity that is not a professional entity practices dentistry in violation of this chapter, and subject to enforcement under RCW 18.130.190, if the person or entity interferes with a licensed dentist's independent clinical judgment by:(a) Limiting or imposing requirements on the length of time a dentist spends with a patient or performing dental services, or otherwise placing conditions on the number of patients atreated dentist must treat in a certain period of time or the number of certain types of procedures a dentist must complete in a certain time period;(b) Limiting or imposing requirements on the decision of a dentist regarding a course or alternative course of treatment for anumber patient or the manner in which a course of treatmentnew is carried out by the dentist;(c) Limiting or imposing requirements on the manner in which a dentist uses dental equipment or materials for the provision of dental treatment;(d) Limiting or imposing requirements on the use of a laboratory or the materials, supplies, instruments, or equipment deemed reasonably necessary by a dentist to provide diagnoses and treatment consistent with the standard of care;(e) Limiting or imposing requirements for the professional training deemed reasonably necessary by a dentist to properly serve the dentist's patients;(f) Limiting or imposing requirements on the referrals by a dentist to another licensed dentist specialist or any other practitioner the dentist determines is necessary;(g) Interfering with a dentist's right to access patient recordsvisits; at any time;(h) Interfering with a dentist's decision to refund any payment made by a patient for dental services performed by the dentist;(i) Limiting or imposing requirements on the advertising of a dental practice if it would result in a violation of this chapter or RCW 18.130.020(12)(b) by the dental practice;

or(j)and Limitingownership or imposingcontrol requirementsover on communications with a dentist's patients.(2) For the purposeoffice ofspace thisand section,equipment "dentist"used meansin a dentist licensed under this chapter.(3) Violations of this section shall be enforced pursuant to RCW 18.130.190, including the authoritydental topractice. issue subpoenas pursuant to RCW 18.130.050(4).

CommunicationNews ofmedia complaintsreports orand informationlawsuits tofrom aother statestates agencyprovide pursuantevidence toof RCWinfluence 4.24.500 through 4.24.520 are covered by thosenondentists provisions.NEWresulting SECTION.  Sec. 4.  Ain new section is added to chapter 18.32 RCW to read as follows:(1) The attending dentist, without reasonable cause, must not neglect, ignore, abandon, or refuse to complete the currentovertreatment procedureand forinappropriate atreatment patient.of patients.

IfIt is the dentistintent choosesof the legislature to withdrawprevent responsibilitysuch abuse in Washington state by establishing the parameters under which dentists can enter into contracts for support services or lease agreements.Sec. 2.  RCW 18.32.020 and 2011 c 336 s 477 are each amended to read as follows:Subject to section 3 of this act, a patientperson practices dentistry, within the meaning of record,this chapter, who (1) represents himself or herself as being able to diagnose, treat, remove stains and concretions from teeth, operate or prescribe for any disease, pain, injury, deficiency, deformity, or physical condition of the dentisthuman shall:(a)teeth, Advisealveolar process, gums, or jaw, or (2) offers or undertakes by any means or methods to diagnose, treat, remove stains or concretions from teeth, operate or prescribe for any disease, pain, injury, deficiency, deformity, or physical condition of the patientsame, thator terminationtake impressions of treatmentthe isteeth contemplatedor jaw, or (3) owns, maintains, or operates an office for the practice of dentistry, or (4) engages in any of the practices included in the curricula of recognized and approved dental schools or colleges, or (5) professes to the public by any method to furnish, supply, construct, reproduce, or repair any prosthetic denture, bridge, appliance, or other structure to be worn in the human mouth.The fact that anothera dentistperson shoulduses any dental degree, or designation, or any card, device, directory, poster, sign, or other media whereby he or she represents himself or herself to be soughta dentist, shall be prima facie evidence that such person is engaged in the practice of dentistry.X-ray diagnosis as to completethe method of dental practice in which the currentdiagnosis procedureand examination is made of the normal and forabnormal futurestructures, care;parts, or functions of the human teeth, the alveolar process, maxilla, mandible or soft tissues adjacent thereto, is hereby declared to be the practice of dentistry.

and(b)Any Adviseperson theother patientthan thata theregularly dentistlicensed willphysician remainor reasonablysurgeon availablewho undermakes theany circumstancesdiagnosis foror upinterpretation toor fifteenexplanation, daysor fromattempts the date of such notice to renderdiagnose emergencyor care related to thatmake currentany procedure.(2)interpretation If a dentist provides dental services as an employee or contractorexplanation of anotherthe dentistregistered orshadow an entity authorized to render dental services pursuant to chapter 18.100, 25.05, or 25.15shadows RCWof orany topart operateof athe dentalhuman officeteeth, pursuantalveolar toprocess, RCWmaxilla, 18.32.675(1),mandible the other dentist or entitysoft shalltissues beadjacent responsiblethereto forby the continuinguse treatment of patientsX-ray andis adeclared dentist who ceases to be anengaged employeein orthe contractorpractice of suchdentistry, othermedicine, dentist or entitysurgery.The ispractice notof deemeddentistry toincludes havethe abandonedperformance anyof patient, and is not obligated to advise any patientdental asor providedoral inand thismaxillofacial section,surgery. with respect to which the continuing treatment responsibility is retained by the other dentist or entity.

If"Oral anand entitymaxillofacial issurgery" responsiblemeans forthe specialty of dentistry that includes the continuingdiagnosis and surgical and adjunctive treatment of patients,diseases, anyinjuries, licensedand dentistdefects whoof is the ownerhard and soft tissues of the entityoral and maxillofacial region.NEW SECTION.  Sec. 3.  A new section is consideredadded theto attendingchapter 18.32 RCW to read as follows:(1) A dentist responsibleor forgroup ensuringpractice complianceof bydentists themay entityenter into an agreement with thisa section.(3)third Aparty dentalfor practicethe ownerprovision whoof isservices discontinuingin support of a dental practice oroffice movingas long as all of the five standards in subsection (2) of this section are met.(2) A third party who, pursuant to a dentalmanagement practiceor other personal services agreement, provides services to a newdentist locationor musta complygroup withpractice of such dentists does not maintain or operate an office for the requirementspractice of subsectiondentistry (1)within the meaning of this section,section oras long as all of the following five standards are met:(a) The third party agreement must makebe reasonableset arrangementsout forin writing, signed by the transferparties, and cover all of the patientservices recordsthe third party will provide to the dentist or the group practice of activedentists patientsfor the term of the dentalagreement;(b) practice,The third party agreement may not exceed a term that is reasonable and necessary and must have a duration of five years or copiesless;(c) The aggregate compensation paid to the third party over the term of the records,agreement tomust abe licensedset dentistin oradvance, professionalbe entity,consistent orwith atfair market value in arm's-length transactions, and may not take into account the writtenvolume requestor value of any patient,referrals transferor ofbusiness otherwise generated between the patient'sparties;(d) records,Patients of the dentist or copiesthe group practice of thedentists records,must tobe fully informed of the patient.agreement;

Anand(e) unlicensedThe personthird orparty entityagreement shallmust not intentionallyinterfere, preventexpressly or impliedly, or have the effect of interfering, with patient care or the dentist's independent judgment, including without limitation the following:(i) By limiting or imposing requirements on the length of time the dentist spends with a patient or performing dental practiceservices, owneror fromotherwise complyingplacing withconditions thison subsection.Sec. 5.  RCWthe 18.32.091number andof 1987patients cthe 150dentist smust 18treat arein eacha amendedcertain toperiod readof astime follows:Noor person,the unlessnumber previouslyof licensedcertain totypes practiceof dentistryprocedures the dentist must complete in thisa state,certain shalltime beginperiod;(ii) By limiting or imposing requirements on the practicedentist's decision regarding a course or alternative course of dentistrytreatment for a patient or the manner in thiswhich statea withoutcourse firstof applyingtreatment to,is carried out by the dentist;(iii) By limiting or imposing requirements on the manner in which the dentist uses dental equipment or materials for the provision of dental care;(iv) By limiting or imposing requirements on the use of a laboratory or the materials, supplies, instruments, or equipment the dentist deems reasonably necessary to provide diagnoses and obtainingtreatment consistent with the standard of care;(v) By limiting or imposing requirements for the professional training the dentist deems reasonably necessary to properly serve the dentist's patients;(vi) By limiting or imposing requirements on the dentist's referrals to another dentist specialist or any other practitioner the dentist determines is necessary;(vii) By interfering with the dentist's right to access patient records at any time;(viii) By interfering with the dentist's decision to refund any payment made by a license.---patient ENDfor ---dental services performed by the dentist or staff;(ix) By limiting or imposing requirements on the dental benefits accepted or the dentist's billing practices;(x) By limiting or imposing requirements on the dentist's or the dental practice's advertising;(xi) By limiting or interfering with the dentist's ability to supervise staff, including but not limited to hygienists, dental assistants, and office managers, or preventing the hiring or firing of such staff;

or(xii) By limiting or imposing requirements on communications with the dentist's patients.(2) The definitions in this subsection apply throughout this section and RCW 18.32.655.(a) "Arm's-length" means bona fide bargaining between well-informed parties to an agreement who are not otherwise in a position to generate business for the other party.(b) "Third party" means any person, other than a bona fide employee of a dentist or a group practice of dentists, who has an agreement to perform services for, or on behalf of, the dentist or the group practice of dentists, including any person or affiliate that has a direct or indirect financial relationship with the third party.(c) Compensation is considered "set in advance" only if the aggregate compensation over the term of the agreement is fixed, it does not include any percentage-based component, and it does not include a provision allowing a nondentist third party to be compensated with equity ownership in a dental practice.(d) Compensation is considered "consistent with fair market value" only if it is consistent with the value in arm's-length transactions and it is included in a third party agreement as the result of bona fide bargaining between well-informed parties to the agreement who are not otherwise in a position to generate business for any other party to the agreement.(3) In all proceedings under or pursuant to this chapter or chapter 18.130 RCW, the uniform disciplinary act, the burden of proof is on the party defending the third party agreement to show that compensation paid thereunder is set in advance and consistent with fair market value.(4) A dentist or group practice of dentists may enter into an agreement with a third party to lease space or equipment necessary for the operation of their dental practice office as long as the standards in (a) and (b) of this subsection are met.(a) Any management or other personal service agreement executed pursuant to this section is independent of any space or equipment lease agreement between the third party and the dentist or group practice of dentists.(b) The third party is presumed to have been operating an office for the practice of dentistry within the meaning of RCW 18.32.020(1) or this section if the third party:(i) Terminates a lease for space or equipment without the consent of the dentist or group practice of dentists within two years of the termination of the management or other personal service agreement;

or(ii) Enters into a new management or other personal service agreement or a new space or equipment lease agreement with a different dentist or group practice of dentists in the same location.(c) The third party may rebut the presumption created by (b) of this subsection with clear and convincing evidence that the space or equipment lease agreement was terminated and the new agreement, if any, was executed for a permissible purpose.Sec. 4.  RCW 18.32.655 and 1994 sp.s.

c 9 s 222 are each amended to read as follows:The commission ((shall)):(1) Shall require licensed dentists to keep and maintain a copy of each laboratory referral instruction, describing detailed services rendered, for a period to be determined by the commission but not more than three years, and may require the production of all such records for examination by the commission or its authorized representatives;

((and))(2) Shall adopt reasonable rules requiring licensed dentists to make, maintain, and produce for examination by the commission or its authorized representatives such other records as may be reasonable and proper in the performance of its duties and enforcing the provisions of this chapter;

and(3) Relating only to a complaint, may, pursuant to RCW 18.130.050, subpoena an agreement between a dentist or group practice of dentists and a third party if the agreement is probative to the issue raised in the complaint and believed to be in violation of section 3 of this act.NEW SECTION.  Sec. 5.  Any employee, independent contractor, or health care professional who reports, in good faith, to the department of health or to any agency or branch of state or local government, practices that may constitute the unlicensed practice of dentistry by a person who is a party to a management or other personal service agreement with a dentist licensed pursuant to this chapter or group practice licensed pursuant to this chapter is a whistleblower.

The provisions of RCW 4.24.500 through 4.24.520, providing certain protections to persons who communicate to agencies and branches of federal, state, and local government, apply to these reports, and a person who has been subjected to reprisal or retaliatory action has the remedies provided under chapter 49.60 RCW and RCW 4.24.500 through 4.24.520.

The identity of a whistleblower must remain confidential.Sec. 6.  RCW 18.32.091 and 1987 c 150 s 18 are each amended to read as follows:Notwithstanding the provisions of chapter 18.100 RCW, no person, unless previously licensed to practice dentistry in this state, shall begin the practice of dentistry, or own, maintain, or operate an office for the practice of dentistry, without first applying to, and obtaining a license.--- END ---