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Oregon Dental Care Organizations Report Financials as State Shifts Away from DCOs

Companies behind DCOs will survive through contracts with CCOs, in a change that may make dental health spending less transparent. Among the three DCOs reporting to the Oregon Health Authority, only Capitol Dental Care, Inc., earned a profit.
June 15, 2015

Oregon’s three remaining dental care organizations, or DCOs, lived short simple lives, and won’t be around much longer. They were born out of the Affordable Care Act to provide dental care to Medicaid recipients, but last year the Oregon Health Authority changed course, requiring all the state’s coordinated care organizations, or CCOs, to integrate dental into their services by July 1, 2014.

“So rather than OHA contracting separately with DCOs for dental services (and paying separately), OHA now includes these services in the CCO contracts and rates,” Susan Wickstrom, Oregon Public Health Division spokeswoman, said in an email.

Of the state’s short-lived DCOs, only Advantage Dental Services LLC, ODS Community Health and Capitol Dental Care had enough members still enrolled last year that they had to report their financial details to the state. The rest had 2,000 members or fewer, Wickstrom said.

The state’s three surviving DCOs will not disappear when they stop operating as dental care organizations. Instead, all three have announced partnerships with CCOs that will allow them to continue to provide Oregon Health Plan-funded dental care. As a result, however, these companies will no longer directly report their financial results to state regulators for much longer. Instead, those figures will be incorporated into the CCO reports of the companies that these organizations contract with.

Advantage Dental Services LLC

Redmond-based Advantage Dental was founded in 1994 to provide dental care in rural areas of Oregon, and doubled in size in 2009 after acquiring the Oregon Health Plan clients who had been enrolled in Hayden Dental. According to its website, the company has more than 322 investor-owners and operates 30 clinics.

Advantage says on its website that it currently has 330,000 patients – some enrolled through the Oregon Health Plan, others through private insurers or who pay out-of-pocket for care.

Advantage Dental Services LLC reported a net loss of $280,000 in 2014. That reflects a loss from the DCO health plan, but does not necessarily reflect a financial loss from sibling companies that are not DCOs. Those related earnings are not reported in Advantage’s annual report to the state.

Capitol Dental Care Inc.

Like Advantage, Capitol Dental Care was founded in 1994, though this DCO’s ownership is no longer local. Last year, Capitol was acquired by H.I.G. Capital, a multi-billion-dollar Florida-based global investment firm. Capitol Dental says on its website that it has about 300 dentists on staff, serving about 200,000 people across the state.

Capitol Dental Inc. reported that last year it received a net income, or profit, of $701,465 from Oregon Health Plan services. Its corporate total profit – which includes both OHP earnings and net income from all other sources - was $4.5 million.

ODS Community Health

ODS Community Health, a subsidiary of Moda Health, provides less information about its membership numbers or history on its website than Oregon’s other DCOs. Moda, which previously operated under the name ODS itself, is one of the state’s major providers of health insurance, with some 220,000 people enrolled in its comprehensive health plans.

ODS Community Health reported a net income, or profit, of $4.6 million from all sources, with its net income from Oregon Health Plan services at $582,237. Moda Health Plan Inc. reported a net loss of $5.2 million last year.

Courtney Sherwood can be contacted at [email protected]. Follow her on Twitter at @csherwood.