By Mark Dilatush, co-founder, Fee for Service Academy
Is this thing even legal in my state? An office manager put that question to us on one of our posts a few days ago, and every dentist who gets serious about an in-house membership plan hits that same wall eventually.
It is the right question, and the one most dentists skip. Practices stand these plans up all the time. The ADA publishes a toolkit for building one. What almost nobody hands you is a straight answer about whether your state cares, and which rulebook it cares under.
Here is the honest answer: the rules are written state by state, and the differences are large enough that two practices doing the identical thing can land in two different places.
One thing before we go further. This article is not legal advice, and Fee for Service Academy is not a law firm. Nothing below tells you what your practice may or may not do. It shows you where the rules live and what to ask, so the hour you spend with an attorney licensed in your state is a productive hour rather than an expensive orientation.
Start with what the plan actually is
The ADA Council on Dental Benefit Programs describes the structure plainly in its in-office dental plan toolkit: the patient pays the doctor or the office a fixed amount monthly or annually, preventive services are generally covered at no charge, and other procedures are offered at a discounted fee. No insurer sits in the middle. No claim gets filed.
That simplicity is the whole appeal. It is also why the legal question is not obvious. A patient paying a recurring fee for future care, at a discount, starts to resemble several things a state insurance department already regulates — even when nobody involved thinks of it as insurance.
Two different rulebooks can reach the same plan
Most states approach this through one of two frameworks, and a practice can sit under either, both, or neither.
Direct primary care agreement statutes. These give providers an express lane: a written private agreement with a patient for a periodic fee, with contracting requirements attached, restrictions on billing carriers, and, the part that matters most, an exemption from insurance-department oversight. The question is whether your state’s version of this law counts dentistry as being inside it.
Discount plan statutes. Separately, many states license the operators of discount medical or dental plans. These laws are written broadly, usually keyed to charging a fee in exchange for member access to discounts. Whether a practice discounting its own services falls inside that definition is a different question entirely, and a state can answer the two in opposite directions.
Five states, five different answers
Louisiana wrote a statute specifically for dentists. La. R.S. 37:798, enacted by Act 55 of 2019, states that a complying direct primary care agreement “is not health or dental insurance” and is not subject to the state’s insurance title, and that a direct dental practice needs no certificate of authority beyond a current dental license.
Then it dictates the contract: in writing, signed by both parties, terminable on 30 days’ written notice, scope of covered services described, no more than twelve months of fees collected in advance, and unearned fees returned on termination. Subsection (E)(7) adds four separate disclosures, all of them in bold font and conspicuously visible: that the agreement does not constitute health or dental insurance, that patients on ACA-compliant health plans may already have pediatric dental coverage, that payments under the agreement may not count toward deductibles or out-of-pocket maximums, and that the patient is encouraged to consult their health plan before signing.
The statute also draws a line any practice mid-transition should read twice. Under § 798(I)(1) a direct dental practice may not enter a participating-provider contract with an insurer to deliver the services covered by a direct agreement. Under § 798(J)(1) it may still enter one “for purposes other than payment of claims for services provided to direct patients through a direct agreement.” The next sentence is the one that gets skipped: “Such dentists shall be subject to all other provisions of the participating provider contract applicable to participating providers.” Having a direct agreement loosens nothing else in a PPO contract you are still in.
Missouri fixed its law in 2022. RSMo § 376.1800 defines “provider” to include a dentist licensed under chapter 332, and says a medical retainer agreement “is not insurance and is not subject to this chapter,” and that entering one “is not the business of insurance.” No certificate of authority is required to market or sell one. Seven requirements attach to the agreement, closing with an instruction to “prominently state in writing that the agreement is not health insurance.” The dental language arrived with House Bill 2168 and took effect August 28, 2022.
Florida has a carve-out sentence, and the definitions section decides how far it reaches. Florida licenses discount plan organizations under its insurance code, and then section 636.204(6), Florida Statutes adds a single sentence: “This part does not require a provider who provides discounts to his or her own patients to obtain and maintain a license as a discount plan organization.”
Read that sentence next to section 636.202 before drawing a conclusion from it, because two of its words are defined terms. “Provider,” for this part of the code, means a person or institution “contracted, directly or indirectly, with a discount plan organization to provide medical services to members” — the carve-out is drafted around providers sitting inside somebody else’s plan. And “discount plan” is defined to exclude “any plan that does not charge a fee to plan members,” so charging the fee is the thing that pulls a plan into the definition in the first place. How those definitions land on a practice running its own plan, with no discount plan organization anywhere in the picture, is a question for a Florida attorney. Reading one sentence of a statute is not the same as reading the statute.
Texas has no equivalent sentence on the face of its chapter. Texas registers discount health care program operators under Chapter 7001 of the Insurance Code. Its definition of “health care services” names dental services outright, and an operator “may not offer a discount health care program in this state unless the program operator is registered with the department.” The chapter’s exemption section names two categories — an insurer holding a certificate of authority, and a health care sharing ministry. Texas is also one of the states the ADA lists as not including dental in its direct-primary-care definition. Whether any particular practice’s plan meets the statutory definition of a program operator, which turns on contracting with providers and setting the charge to members, is a question for a Texas attorney.
Washington shows why reading the statute is not always enough. RCW 48.150.010 builds its definitions around “primary care,” meaning “routine health care services, including screening, assessment, diagnosis, and treatment for the purpose of promotion of health, and detection and management of disease or injury.” It defines “health care provider” broadly, as a person regulated under Title 18 to practice health or health-related services. Dentists are regulated under Title 18. The word “dentist” appears nowhere in those definitions.
Washington’s Office of the Insurance Commissioner publishes its own reading on the direct primary care practices page: registration is required of practices that offer direct primary health care services, charge a monthly membership fee, and only provide primary care, while “optometrists and other specialty providers who don’t provide primary care services don’t need to register.”
The ADA’s appendix counts Washington among the twenty states whose definitions do include dental, and then attaches a note to that row: “State insurance authority currently rules dentists are not eligible to engage in DPCAs.” That note is dated June 13, 2022, and it describes an interpretation rather than a statute — which is exactly the kind of thing that can change without a word of the law changing. We checked the Commissioner’s current page and its most recent Direct Practices Report to the Legislature, dated December 1, 2025. Neither mentions dentists at all, in either direction. So we are telling you what the ADA wrote, and not asserting that it still holds. In Washington, that is a question for the Commissioner’s office and your own counsel.
The best free map is four years old
The ADA’s appendix of states with direct primary care agreement legislation is the most useful public starting point we know of. It counts twenty states that include dental in the definition of a provider authorized to enter these agreements, two of them dental-specific, and twelve that do not.
It is also dated June 13, 2022, and Missouri appears in both lists at once — in the twenty, citing House Bill 2168, and in the twelve, citing the older 2015 law. The timing explains how that happened. The 2015 version of the Missouri statute defined only “physician.” House Bill 2168 replaced that word with “provider” and wrote dentists in, and it took effect on August 28, 2022, ten weeks after the appendix went out. The appendix added the new row and left the old one standing. The live statute settles it, and four years of legislative sessions have come and gone since.
Use it as a list of where to look. Do not use it as an answer about your state.
What to do before you launch one
- Ask both questions, in order. Does your state’s direct-agreement statute include dentistry? Does your state license discount plans, and if so, does it carve out a provider discounting to its own patients?
- Treat the contract as the compliance work. Where these statutes speak, they mostly speak about contract terms — notice periods, prepayment limits, refund of unearned fees, what has to appear in bold.
- Read the disclosure requirement literally. Both Louisiana and Missouri require the agreement to state prominently and in writing that it is not insurance. Louisiana goes further, specifying bold font, conspicuous visibility, and four separate statements. Those are drafting instructions. Follow the ones your own state writes down, to the letter.
- Check what it does to the contracts you still hold. Louisiana’s statute restricts overlap between a direct agreement and a participating-provider contract. Your plans and your state may treat that differently.
- Put it in front of an attorney licensed where you practice. The ADA’s own toolkit stops at exactly this point, and so do we.
Where this sits in a transition
A membership plan gets built during the foundation work, alongside the real fee schedule, the scheduling changes, and the team scripting, well before the first cancellation letter goes out. Sequencing is most of the job.
That sequencing, and the per-practice homework behind it, is what we do at Fee for Service Academy. If you want to know whether your practice is positioned for it, start at feeforserviceacademy.com.
This article describes publicly available state statutes and regulator guidance as of August 26, 2026. Laws change. Fee for Service Academy is a business consultancy, not a law firm, and nothing here is legal advice or a legal opinion about your practice. Consult an attorney licensed in your state before launching a membership plan.