More than a dozen states have introduced legislation to implement a dental loss ratio so far this year.
Overall, 23 states have filed dental loss ratio bills since the start of 2023, according to an April 22 news release from the American Dental Association.
Dental loss ratios ensure that patient premiums are being spent on patient care rather than administrative costs.
Here is where dental loss ratio stands in April 2025 across 12 states:
Source: Where dental loss ratio legislation stands in 2025 / Becker’s Dental + DSO Review
Dental Loss Ratio is supposed to be a simple ratio: %of premiums spent for people covered by a plan.
However, the model legislation that ADA has signed with NCOIL allows for fudge factors, the one in the numerator gives a higher $ amount, and the one in the denominator enables a lower number. Together the fudge factors enable ins cos to report higher DLRs that do NOT reflect the % of premiums spent for people covered by a plan.
When there are announcements of activity at state level, it behooves us to know some details. Most of the article referenced here is very vague on details, and most talk is about what % states would like to see as the reported DLR from dental ins cos in their state (referring to “fully-insured plans” that are covered by state laws).
Not mentioned, but critically important for a tangible insurance reform via DLR: 1-what are the definitions for numerator and denominator (clean definitions allow no fudge factors). 2- What % of premiums need to be spent for covered patients? 80-85% are common asks, often depending on “large market” plans or smaller plans. 3-What is the consequence of an ins co failing to pay out the required %. 3- Are premium increases limited by this law? Yes, they need to be limited to an index or need to get approval from a state commission. Ins Cos would love the freedom to increase premiums at will to counter any increase in the checks they are forced to write.
My point is that we and our state advocates must be aware of what constitutes actual insurance reform…because DLR is just a buzzword. Saying they got a DLR law might be good and might be no insurance reform at all. (Unfortunately, the ADA signed an agreement for a DLR model that is not any sort of insurance reform…. the NCOIL DLR model stinks. If feel sorry for any state that adopted that model.)