Dental practices in California will be able to collect insurance payments straight from patients' dental plans starting Jan. 1, 2027, under a new state law that requires plans to honor a patient's assignment of benefits. Gov. Gavin Newsom signed Assembly Bill 1629 in September, and the California Dental Association, which sponsored the bill, announced the signing on Sept. 28.

For many offices, the change ends a familiar routine. When a plan refuses an assignment of benefits, the patient pays the full fee up front and then waits for the insurer to reimburse them. Under AB 1629, a dental plan must send payment to the practice when the patient assigns benefits to it, including when the dentist is out of network.

The law also requires that patients be told before treatment whether their dentist is in their plan's network, along with an estimate of what they may owe out of pocket.

"Assignment of benefits legislation has been one of the biggest asks from CDA members," CDA President Robert Hanlon, DMD, said, according to Becker's Dental Review.

When plans mail reimbursement checks to patients instead of the office, practices can be left chasing the balance. The American Dental Association has noted reports of patients cashing those checks and then not paying their dental bills, as reported by DentistryIQ. Offices may also never see the explanation of benefits when the money goes to the patient, which makes reconciling accounts harder.

Supporters argue the old arrangement also hurt patients with less money on hand. A patient who cannot front the full cost of a crown or root canal may put off care, even with coverage in place.

AB 1629 also requires dental insurers to report provider network information for every plan they sell in the state. Regulators will use that data to judge whether plans have enough dentists to serve the people enrolled in them. The CDA has framed narrowing networks as a result of reimbursement rates that have stayed flat or dropped.

The bill is part of the CDA's "Fix Our Dental Insurance" campaign. This will be described it as the 12th CDA-backed bill signed into law dealing with how payments move through dental plans.

The law has a significant limit. Self-funded employer plans governed by the federal Employee Retirement Income Security Act fall outside state insurance law, so the direct payment requirement does not reach them. Becker's reported that nearly half of Californians with commercial dental coverage are in ERISA plans, which are also excluded from the state's network adequacy reviews.

That leaves front desks with an extra step. The CDA has advised dentists to confirm whether a patient's plan is federally regulated. Under a 2023 CDA-sponsored law, that information should appear on the insurance card or the plan's online portal, or be provided on request.

For California practices, the practical work before Jan. 1 is largely administrative: reviewing how assignment of benefits forms are collected, updating financial policies that currently require full payment at the time of service for out-of-network patients, and training staff to identify ERISA coverage at check-in. Offices that take out-of-network patients stand to see the biggest change in how quickly claims turn into collected revenue.

Sources: Decisions in Dentistry · Becker's Dental Review · DentistryIQ