The Organized Dentistry Coalition, in an effort led by the Academy of General Dentistry, asked Congress to force insurers to honor business interruption insurance coverage for dental practices that have suffered economic losses due to state-mandated shelter-in-place orders.
“Most dental practices have been compelled to forgo providing nonemergency services or close entirely, and states are just beginning the process of reopening and allowing nonemergency care,” the coalition wrote in a May 19 letter to leaders of the House and Senate.
According to the ADA (American Dental Association) Health Policy Institute survey conducted April 20, 86% of dentists have experienced at least a 5% drop in total patient volumes. Furthermore, dental offices have experienced the highest number of job losses within the health care industry, losing slightly more than a half-million jobs between March and April, according to the U.S. Bureau of Labor Statistics.
Many practices forced to close due to government-mandated closures to stop the spread of the coronavirus have turned to their insurers for help, making claims on their business interruption insurance. Business interruption insurance is part of a business owner’s insurance policy. It provides coverage to businesses that must temporarily close due to a disaster, such as a tornado or hurricane. But, their claims have been denied.
“Many dental practices that currently hold business interruption insurance have recently learned that their polices do not cover government-ordered business shutdowns caused by a national emergency or viral pandemics,” the coalition write. “This lack of coverage has had a substantial negative impact on owner-dentists under the assumption that the insurance policies they have been paying premiums on for years would provide support during this crisis.”
The coalition is asking Congress to consider an immediate support mechanism to help businesses left in the lurch by their insurers, and to build on the recently reauthorized Terrorism Risk Insurance Act to require insurers to offer market-oriented solutions for shutdown or viral-related business interruption insurance coverage that are guaranteed with some kind of federal partnership, trust fund, or backstop.
“The COVID-19 crisis has brought to light deficiencies in preparedness and response at numerous levels. We hope that Congress will seize this opportunity to act on these oversights, such as in the case of detrimental business interruption insurance exclusions, as it continues to develop smart policies to sustain our economy going forward,” the coalition concluded. “Dental offices are eager to reopen to treat their patients and rehire their employees, but many owner-dentists will not be able to do so unless they receive direct financial support.”
Beasley Allen is actively pursuing cases with clients whose insurance companies denied their business interruption claims. Dee Miles, Head of our Consumer Fraud Section, Rachel Boyd and Paul Evans are spearheading this litigation for our firm. They would like to talk to you about any potential claims.