The notice requests that the refunds be made no later than December 31 for the profits these companies have made, and continue to make, due to consumers' underutilization of healthcare services during the shutdown, according to the California Dental Association (CDA).
If refunds have not already been issued, then they should be reflected in the November or December premium statements sent to policyholders or certificate holders, Lara wrote. He noted that each insurance company may exercise reasonable flexibility in determining how best to implement this partial refund.
"Policies of specialized health insurance, such as dental insurance, that have a maximum annual benefit may instead accomplish the requested refund by increasing the covered person's 2021 maximum annual benefit by a percentage reflecting the period during which covered services were not available during 2020," he wrote. "For example, as dental practices were essentially closed for a calendar quarter of 2020, each insured's 2021 maximum benefit would be increased by at least [25%]."
Every insurance company subject to the notice should report its actions in response to this request within 45 days to the California Department of Insurance, according to Lara.
"The extra yearly benefit dollars will be helpful to patients making treatment decisions," said Teresa Duncan of Odyssey Management. "The emotions surrounding COVID-19 transmission risk and economic hardship caused many patients to delay treatment. Offices should review the list of carriers and make sure patients are aware if they're affected. If you're not in California, keep an eye on your local dental society news, as it's possible your state will have similar regulations passed."
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