State Regulators Approve Sale of Advantage Dental to National Company
The long wait is over for Advantage Dental which received approval earlier this week to sell 80 percent of its holding company to DentaQuest, the nation’s second largest oral health company based in Boston.
“We’re very pleased that the Insurance Commissioner was able to approve the order and are anxious to close the deal in the next 60 days,” Mike Shirtcliff, the founder and president of Advantage, told The Lund Report. “Our goal is to improve oral health for everyone in Oregon.”
Advantage operates 42 dental clinics in Oregon, and has contracts with the 16 coordinated care organizations to provide dental care.
In her Executive Order, Insurance Commissioner Laura Cali said her agency found nothing to suggest the “proposed acquisition will be hazardous or prejudicial to the insurance buying public. The applicants do not anticipate any changes in the business plans of Advantage.”
Cali did not mention the purchase price in her Order, but did say it had been “negotiated at arm’s length,” with advice from the national professional firm Alvarez & Marsal.
The new Advantage board will include four officials from DentaQuest and two from Advantage’s operations.
Currently, Advantage provides dental care to 330,000 Medicaid members in Oregon and 65,000 PacificSource members in Oregon, Washington, Idaho and Montana.
DentaQuest, based in Boston, has 24 million members; the majority are Medicaid and the underserved population.
Discussions about a potential partnership got underway after Shirtcliff shared the podium with Steve Pollock, DentaQuest’s CEO, at a national Medicaid dental conference two years ago. Both men quickly learned they had similar philosophies –to improve health outcomes and lower costs among the low-income population – people who had often gone without basic dental services and had frequently resorted to hospital emergency rooms for treatment of acute pain.
Coincidentally, Advantage was looking for additional capital for its 300 dental owners, many of whom were eager to retire and wanted to recoup their equity investments. “Until now, we’d never taken any money out of the company and had kept re-investing those dollars so we could continue growing,” Shirtcliff said.
Pollock was intrigued by the collaborative approach developed by Shirtcliff where dentists are not only the providers but the financial backers, the owners of the company. Now he’s hoping to replicate that model elsewhere in the country.
“I’m excited to learn more about the success of the Oregon program and look for ways to build upon that elsewhere in the country to improve oral healthcare,” he told The Lund Report earlier. “Through this collaboration, our two organizations will learn from one another to build on best practices in the administration of dental benefits and the delivery of oral healthcare.”
Shirtcliff has a long history of integrating oral health into patient-centered models of care, and works alongside the state’s coordinated care organizations to implement this design.
“I’m really excited about this new relationship with DentaQuest,” he said. “There’s been a lot of curiosity across the country about how Advantage Dental is interfacing with the oral and physical health of our community. Its mission-driven approach to health improvement is aligned perfectly with our own commitment to improving oral health access, especially for the underserved.”
Advantage Dental, which was founded in 1994 as Roseburg Dental Services, has been a pioneer of the dental care organization model for Medicaid, where a for-profit collaborative of dentists assumes risk for their patients through per-patient monthly global budgets. Advantage, now based in Redmond, is also the exclusive dental provider for individuals with insurance through PacificSource in Idaho and Oregon. Advantage has dentists in those states as well as Washington.
Diane can be reached at [email protected].