Smile Center sues Delta Dental over withholding of payments

How much dental care is too much?

A group of dental clinics that serves low-income Minnesotans is suing Delta Dental of Minnesota, saying the dental-benefits company is wrongfully withholding $2.8 million in reimbursements going back to mid-2008.

Nobody is disputing that the clinics provided that much care to enrollees in state-funded programs including Medical Assistance. What's at issue is whether all of it was warranted.

In the lawsuit filed April 14 in Hennepin County, five Smile Center Clinics in the metro area and beyond said Delta had used its "economic stranglehold" to try to force its dentists to provide less care than the low-income enrollees deserve.

Delta Dental is the biggest dental benefits company in the state. In addition to its commercial clients, including self-insured employers, Delta also administers benefits for three state programs for poor Minnesotans: Medical Assistance, General Assistance Medical Care and MinnesotaCare. It does so as a sub-contractor to health insurance plans that contract with the state.

Delta Dental said it held the money because the clinics provided significantly more services per patient than other clinics that serve poor Minnesotans, leading Delta to suspect fraud.

As a dental benefits administrator, Delta has no financial stake in the matter. "These funds belong to the health plans and to the State of Minnesota," said corporate attorney Dave Morse.

Needed care or fraud?

The five Smile Center Clinics involved in the lawsuit are in Deerwood, Big Lake, Savage, St. Paul and Brooklyn Park. They provide care to low-income Minnesotans who often suffer from severe, long-term dental neglect, according to the lawsuit. Some are recent immigrants who did not grow up with fluoridated water and had no previous dental care.

"In the cruelest form of irony, Delta now claims that the level of care plaintiffs have given these patients is itself somehow evidence of wrongdoing," the complaint states. "In other words, it is not that plaintiffs have failed to care for these public program patients, but rather, that plaintiffs have cared for them too well."

The Smile Center Clinics employ 34 dentists and 40 dental hygienists, according to the filing.

An attorney for the clinics said he had no public comment beyond what's in the filing. "The pleadings stand for themselves," attorney David Aafedt said Monday.

In an interview Monday, Delta Dental said it began looking at use patterns at the Smile Center Clinics after receiving an anonymous letter from "a concerned dentist" about the Big Lake clinic, alleging welfare fraud and insurance fraud.

For example, the average amount paid per patient at the Big Lake clinic was $373 in 2008, compared with $241 at other clinics that serve similar patients. Delta asked Smile Clinic dentists to explain why the number of services at their clinics was so much higher, but they "didn't produce any information," Morse said.

Delta said dentists at the five Smile Center Cinics have just a fraction of the 1,545 dentists in the network for public programs. Of the 132,000 patients on public programs who saw a dentist in 2008, 14,000 went to a Smile Center, according to Delta.

Such disputes between Delta and dentists are uncommon. Delta said it has had five or six similar disputes in the past two to three years and almost all have been resolved.

Despite the lawsuit, the Smile Center Clinics continue to see patients on the state programs.

Chen May Yee • 612-673-7434