Bills that Washington State Rep. Michelle Caldier and Sen. Patty Kuderer recently introduced to curb excessive pay hikes for executives and board members at nonprofit insurance companies in Washington State1 died in committee on Friday, February 2, 2018.
“The WSDA supports HB2500 and SB6392. At a time when people’s insurance premiums are skyrocketing I am appalled Delta Dental could justify increasing the CEO’s salary from $1.4 to $2.7 million in two years,” said Cynthia Pauley, DDS, president of the Washington State Dental Association (WSDA).
“This legislation would have allowed the people paying the premiums to have a say in the process. We understand the insurance companies lobbied heavily against the bills, which ultimately died. Representative Michelle Caldier plans to reintroduce it next year,” Pauley said.
The proposed legislation was prompted by alleged abuses by Delta Dental of Washington (nonprofit 501c 4).
“It’s unconscionable to me that at a time when Washingtonians’ healthcare premiums are surging by double digits, executive pay at our nonprofit insurance companies continues to rise exponentially,” said Caldier.
“If this bill had already been in statute, members of the public would have been able to decide whether the compensation of Delta Dental’s CEO should’ve nearly doubled from $1.47 million in 2014 to $2.72 million in 2016. I think it’s time we put them in charge of these decisions going forward,” said Caldier.
Kuderer introduced the companion bill in the state senate.
“When people’s lives and well-being are at stake, it’s entirely reasonable that we hold these organizations to a higher standard of transparency and accountability in the way that they do business,” said Kuderer.
“It is morally reprehensible that supposedly mission-driven organizations would put their own profits over the people they serve. This common sense legislation will help ensure that duty of care, quality of service, and reducing costs for customers come before executive pay,” said Kuderer.
On January 9, 2018, five prominent dentists affiliated with the leadership of the WSDA filed a formal complaint against Washington Dental Service (dba Delta Dental of Washington) with the Washington State Office of Insurance Commission (OIC).2 Review and decision by the Washington State OIC remains pending.
Craig E. Neal, DDS, MD, president of the Seattle/King County Dental Society, wrote an opinion piece published by The Seattle Times on November 5, 2017.3 Neal specifically laid out numbers of alleged abuses by Delta Dental of Washington.
“As the head of a nonprofit company, CEO Jim Dwyer, whose salary has more than doubled to $2.75 million over the last six years, claims Delta can no longer afford to dedicate that much to patient care. The board of directors, all now receiving more than $100,000 for part-time service on a nonprofit board, agrees,” Neal wrote.
“Their position demonstrates how patient benefits increasingly are taking a back seat to advertising, salaries, and other overhead. Delta’s bottom-line focus ignores what their members are saying is best for patients, a trend that sadly isn’t new,” Neal continued.
Jim Dwyer, president and CEO of Washington Dental Service and Delta Dental of Washington, countered Neal’s viewpoints in The Seattle Times with his own commentary published on November 19, 2017.4
“Delta Dental’s member-dentists also enjoy a level of transparency and accountability unlike any other. Since its inception more than 60 years ago, member-dentists have served on Delta Dental’s independent board of directors—the only insurer in the state that has dentists on its board,” Dwyer said.
“As always, our priority is to ensure quality care is accessible to as many of our Washington neighbors as possible. We are committed to open dialogue and will continue to work with our member-dentists to uphold our commitments to the patients we serve and to the broader community—together,” Dwyer said.
Delta Dental of Washington was invited to comment or offer a statement on the Washington State legislation. Requests were unanswered at time of publication.
References
1. Washington State House Republicans (press release). Caldier, Kuderer Introduce Legislation to Curb Excessive Executive and Board Pay at Nonprofit Insurance Companies. Jan 22, 2018; http://michellecaldier.houserepublicans.wa.gov/2018/01/22/caldier-kuderer-introduce-legislation-to-curb-excessive-executive-and-board-pay-at-nonprofit-insurance-companies/
2. Davis MW. Dentists File Formal Complaint Against Delta Dental of Washington. Jan 24, 2018; http://www.dentistrytoday.com/news/todays-dental-news/item/2853-dentists-file-formal-complaint-against-delta-dental-of-washington
3. Neal CE. You and Your Dentist May Have a Bone to Pick with Delta Dental. Nov 5, 2017; https://www.seattletimes.com/opinion/you-and-your-dentist-may-have-a-bone-to-pick-with-delta-dental/
4. Dwyer J. Delta Dental Aims to Deliver Good Oral Health, Not Red Tape. Nov 19, 2017; https://www.seattletimes.com/opinion/delta-dental-aims-to-deliver-good-oral-health-not-red-tape/
Dr. Davis practices general dentistry in Santa Fe, NM. He assists as an expert witness in dental fraud and malpractice legal cases. He currently chairs the Sante Fe District Dental Society Peer-Review Committee and serves as a state dental association member to its house of delegates. He extensively writes and lectures on related matters. He may be reached at mwdavisdds@comcast.net or smilesofsantefe.com.
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