DMHC Fines Dental Plan $25,000

The Department of Managed Health Care has fined United Dental Care of California $25,000 for failing to pay provider claims in a timely manner and with the appropriate interest, as well as underinsuring its corporate staff.

The DMHC has determined that the San Diego-based United Dental had engaged in an unfair payment pattern as the result of a routine fiscal and administrative survey. It failed to pay the correct interest on late claims 77% of the time, failed to pay claims in a timely manner 6% of the time, and failed to pay appropriate interest and penalties on disputed claims 67% of the time. A compliance rate of 95% for all three payment types is required under state law.

United also only carried a $200,000 fidelity bond to indemnify its officers, trustees and executives when a $600,000 bond was required based on the plan's annual revenue.

United's penalty is the ninth levied by the agency this year against a plan engaged in an unfair payment pattern. The penalty is the first one levied by the DMHC against United Dental since 2006, and is by far the largest fine. The 2006 penalty carried a $7,500 fine, and a 2005 infraction led to a $5,000 fine.