ADA opposes Delta Dental’s acquisition of Cherry Tree Dental

Urges Wisconsin insurance commissioner to evaluate impact on providers, patients

ADA leaders filed a letter with the Wisconsin Office of the Commissioner of Insurance expressing opposition to Delta Dental of Wisconsin’s proposed acquisition of Cherry Tree Dental, a 25-clinic dental practice with locations primarily in Wisconsin. The filing notes potential conflicts of interest and concerns about patient care under the proposed ownership structure.

Delta Dental informed the Wisconsin Dental Association and its provider network July 1 that it had purchased Cherry Tree Dental. In mid-July, Delta Dental filed papers with the Office of the Commissioner of Insurance outlining a proposed corporate restructuring related to the transaction. The purchase by an insurance company of a dental practice in Wisconsin is unprecedented and has drawn attention from both the Wisconsin Dental Association and the ADA.

“Permitting Delta to own a large Wisconsin dental practice, becoming both the claims payer and the employer of the healthcare providers submitting those claims, would make the situation much worse for oral healthcare in the state,” the ADA said.

The ADA expressed concerns that direct ownership by Delta Dental could compromise dentists’ ability to advocate for patients. In traditional arrangements, dentists can appeal plan decisions regarding patient care or choose to leave a network if plan policies are overly restrictive. However, the ADA warned that when dentists are employed by the payer, challenging cost-related decisions could label them as “problem employees,” potentially discouraging proper patient care.

The Association also raised concerns about market competition and access to proprietary information. Delta Dental’s acquisition could influence agreements, business practices, and fee schedules between Cherry Tree and other payers, potentially creating unfair competition.

“Any competition that may have been presented by other dental plan companies will be permanently stifled in the future as there will be no incentive to enter the Wisconsin market,” the ADA cautioned.

While Delta Dental has proposed a corporate reorganization intended to mitigate potential conflicts of interest, the ADA said the changes are largely superficial and do not provide meaningful independence for Cherry Tree clinics or protection for patients. The letter stresses that concentrated market control by a single entity could negatively impact oral health standards and patient care across the state.

The ADA urged the Office of the Commissioner of Insurance to carefully evaluate the proposal and its potential impact on patients, providers and the Wisconsin dental market before approving the acquisition.

“Concentrated control of a market, including oral healthcare services, silences vital perspectives, influences, and competition from a wide range of stakeholders. Delta’s gain will come at the expense of Wisconsin’s citizens. That should not be permitted to happen,” the letter concluded.

The Office of the Commissioner of Insurance is reviewing Delta Dental’s proposed acquisition and has made related filings publicly available on its website.