Dentists urge opt‑in and disclosure rules for insurers using virtual credit cards
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Summary
Dentists and dental providers asked the committee to require insurers to allow providers to opt in before being paid via virtual credit cards and to mandate disclosure of processing fees, citing fraud and processing costs of up to 5%.
Dr. Kate Thomas, a practicing dentist, told the Joint Committee on Financial Services that insurers increasingly disburse claims payments via virtual credit cards that providers did not elect to receive. She said these virtual cards frequently carry processing fees — sometimes as high as 5% — and can be used by anyone in an office who opens the card, creating both a cost and a fraud risk.
"So these cards come with high processing fees, fees, sometimes as high as 5%. And that means that every time a provider gets paid for their services, they lose a portion of that payment," Thomas said. She urged a simple statutory solution: providers must be given the ability to opt in to receive payment by a virtual card, and insurers should be required to fully disclose any fees associated with such payments.
Committee members asked technical questions about whether processors or banks receive portions of the fees and how the state’s recently passed dental minimum loss ratio (MLR) policy interacts with these fee flows. Providers asked for clear opt‑in language and simple disclosure rules so practices — particularly small practices — are not forced into higher‑cost payment methods.
No committee action was taken on the virtual card language during the hearing.