Delta Dental of Wisconsin’s dental practice acquisition draws concerns

Delta Dental of Wisconsin’s recent purchase of Cherry Tree Dental, a dental practice with 25 of its 31 locations in the state, has drawn concerns from dentists.

Cherry Tree will remain a separate company with an independent leadership structure, and the acquisition will “help stabilize, strengthen, support and fortify access to care in Wisconsin,” according to the Stevens Point-based dental insurance provider.

“The dental industry continues to evolve, and a significant challenge is access to oral healthcare across some areas of Wisconsin,” Delta Dental said in a statement. “This opportunity will give us the platform to execute on our mission to improve oral and overall health by allowing us to maintain and expand access to care outside of more urban areas of the state. A stable network is good for patients and members.”

Delta Dental said the purchase brings Cherry Tree’s ownership back to Wisconsin after its recent ownership by a private equity group, which the insurer declined to name due to the terms of its purchase agreement. The deal closed June 30.

Mark Paget, executive director of the Wisconsin Dental Association, said the acquisition surprised them. They want to make sure the carrier’s ownership of the company does not get in the way of dentists treating patients, he said.

“We hope there’s going to be a firewall, that this is strictly a financial decision on the part of Delta Dental, and they’re not intending to get into patient care, treatment planning, fee schedules and reimbursements,” he said. “We hope that they treat Cherry Tree the same that they treat all of their other network providers.”

Delta Dental has the largest share of the dental insurance market in the state. The Wisconsin Dental Association doesn’t want to see the insurer force or steer patients to Cherry Tree for care, and it wants to ensure that Delta Dental has fair fee schedules that don’t show favoritism to Cherry Tree.

Paget said the acquisition of a dental practice by a dental insurer is unique.

“Our members are very concerned about what kind of precedent this is going to set,” he said. “This has really not happened anywhere else in the country.”

The American Dental Association warned earlier this month that an insurance company being a healthcare provider and payer raises questions about potential conflicts of interest. They said it could lead to limited care options for patients that focus on what is most cost-effective for the insurer, rather than what’s best for their health.

“The (American Dental Association) believes that the health interests of patients are best protected when dental practices and other private facilities for the delivery of dental care are owned and controlled by a dentist licensed in the jurisdiction where the practice is located,” they said in a statement.

This article first appeared in the Wisconsin Health News daily email newsletter. Sign up for your free trial here.