Introduction 

Oral health is essential to overall health and has deep implications for economic wellbeing. Poor oral health can cause missed days of school and work, and about one-third of low-income adults say that dental conditions limit their job prospects. Alternatively, access to dental care can improve employment outcomes and increase earning potential. Unfortunately, the dental care access that can unlock economic mobility is often unaffordable. Dental care routinely ranks number one among health care services that pose financial barriers and is also a leading driver of medical debt. Forty-one percent of adults have medical debt and about half of those say dental bills contributed to it.   

Dental care’s key role in our nation’s healthcare affordability crisis is a predictable consequence of the limitations of our current dental coverage framework, especially for adults. Dental coverage remains largely separate from broader health insurance with only about 15% of people covered by employer-sponsored insurance (ESI) having a medical plan that includes coverage of dental care. Additionally, routine dental services for adults are not part of the federal Essential Health Benefits (EHBs), which most private health insurance plans must cover, and a regulatory prohibition bars states from optionally including adult dental services in their EHB frameworks. Dental care for adults remains optional in Medicaid, with wide state-by-state variation in covered services, benefit limits, and cost-sharing. And, while Medicare has begun paying for medically-necessary dental care under limited circumstances, traditional Medicare does not include any coverage for routine dental care. About 60% of people with dental debt have dental insurance, driving home the limitations to dental coverage arrangements.  

These limitations in dental coverage, especially for working-age adults, open the door for loosely-regulated alternatives that can pose steep risks to people’s access to dental care and economic health, and erode trust in the healthcare system. These risks are particularly pervasive for low-income and other marginalized communities who already face the steepest barriers to accessing and affording dental care. This brief examines one of these alternatives – direct care agreements (DCAs) – and the potential risks they pose to dental care access and affordability. While some state-level DCA protections exist, additional oversight and more expansive policy solutions are necessary to ensure dental care is accessible and affordable.  

 

Significant Gaps in Dental Coverage Lead to Access Issues 

The separation of oral health coverage from broader medical insurance arrangements, and especially the widespread omission of adult dental coverage, has consequences for individual- and community-level oral health. Firstly, the optional nature of Medicaid adult dental benefits leads to wide state-by-state variation in benefit arrangements. Only 11 states (plus D.C.) offer extensive dental benefits to adults covered by Medicaid, with the majority of states offering a more limited benefit package; specific covered services vary widely from state to state, and commonly needed services are often left out. For example, half of states do not cover fluoride application for adults, and at least half of states have limits on the coverage of root canals. At least 15 states include an annual benefit maximum (ABM), limiting the amount of dental coverage adults with Medicaid can receive and introducing significant financial barriers to needed dental care for adults with low incomes. 

Additionally, despite serving as the primary source of health insurance for older adults and people with disabilities, traditional Medicare does not cover routine dental benefits. This gap in service coverage is problematic because, as a result of age and/or disability status, people with Medicare coverage are more likely to have chronic conditions that are associated with oral health problems. About one-third of older adults have lost six or more teeth due to oral health problems and nearly two-thirds of people with disabilities have not visited a dentist in two or more years. While many Medicare Advantage (MA) plans cover at least some dental services, people with this coverage experience problems accessing care at about the same rates as those in traditional Medicare. Over the last several years, the Centers for Medicare and Medicaid Services (CMS) has used regulatory authority to add coverage for dental services when they are medically necessary and inextricably connected to other covered medical care. However, this coverage is very narrow, limited to specific conditions, and does not apply broadly to people with Medicare coverage who require access to comprehensive preventive and restorative dental care to maintain their oral and overall health.  

With respect to private insurance, dental care remains largely covered by separate excepted benefits plans that do not include the same consumer protections that most other health insurance products are required to offer. For example, for adults, standalone dental plans (SADPs) are not prohibited from applying annual and lifetime limits on coverage, nor are they required to cap out-of-pocket spending. This is, in part, because adult dental coverage is not defined as an Essential Health Benefit (EHB) – categories of healthcare services that the Affordable Care Act (ACA) requires most private health insurance plans to cover and that are required to abide by key consumer protections. Alternatively, the ACA does include dental coverage for children in the EHBs, which has helped to address racial and income-based disparities in oral health outcomes. Additionally, 50% coinsurance rates for all services beyond preventive or basic restorative care and ABMs between $1,000-$2,000 are near universal in private dental insurance, including Medicare Advantage plans, leaving many people with insurance functionally underinsured or fully uninsured when they need care the most. 

Many of the above limitations leave adults with no access to dental insurance – 28% of adults lack dental coverage compared to 10% who lack medical coverage. However, even people with dental coverage often cannot access or afford the oral healthcare they need because of high cost-sharing, coverage limits, and dental workforce shortages. The fact that dental services represent the leading cause of financial barriers in healthcare is a direct result of these access barriers, which put people’s oral health and financial security at risk 

Loosely-Regulated Insurance Alternatives Put Consumers at Additional Risk  

In addition to the consequences for access to care, oral health outcomes and financial security, dental coverage limitations also open the door for predatory alternatives to insurance products. An inadequate coverage landscape leaves patients susceptible to these alternatives when they need dental care that they have no other way to afford. Medical credit cards, especially those with deferred-interest terms, are one example. These products start with no interest for a promotional period, but if the balance isn’t paid off by the end of that period, interest upwards of 30-40% is retroactively applied to the full amount of initial charges (not simply the remaining balance), putting patients at risk for costs sometimes multiple times what they were initially charged for their care. Medical credit cards are most-commonly offered in dental compared to other medical settings because of the coverage limitations and the resulting affordability issues described above.  

One additional insurance alternative that has recently started to gain prominence in dental care settings is direct care agreements (DCAs). DCAs have historically been used in primary care settings and are often structured as an agreement in which a provider offers a specific set of services in exchange for a set monthly fee paid by a patient. Importantly, DCAs are generally not considered insurance, are not regulated as such, and thus do not have to extend consumer protections typically applied to health insurance products. These agreements represent a particular risk for people who are uninsured or who need access to services their insurance will not cover and take advantage of loopholes for quasi-coverage products that are mostly unregulated. The increasing prominence of DCAs in dental settings represents an acute symptom of a healthcare system that has never treated oral health as truly essential. With adult dental services largely left out of major public and private coverage arrangements, it is no surprise that loosely-regulated insurance alternatives have found fertile ground to grow.   

Because most private dental insurance plans already do not have to comply with key ACA consumer protections for adults, DCAs can seem like a reasonable alternative. However, DCAs do pose additional risks above and beyond the limitations of traditional dental coverage; DCAs may offer some patients a way to access care they could not otherwise afford, but they do so without the oversight or protections that dental insurance does provide, even with the limitations inherent to the current system, and with additional risks. Patients who turn to DCAs risk paying for care that can be discontinued without warning or that may not cover the services they ultimately need; patients also risk being left with no recourse if an agreement is discontinued or becomes insolvent. The spread of DCAs into dental care should be read not as evidence that these products meet a genuine need, but as a warning sign about the gaps they are promising to fill.  

With adult dental services largely left out of major public and private coverage arrangements, it is no surprise that loosely-regulated insurance alternatives have found fertile ground to grow.

The Risks of Direct Care Agreements in Dental Settings  

Currently, only about half of states are proactively regulating DCAs, with many of the rest explicitly exempting these arrangements from requirements that insurance products have to follow. Almost half of states include dental providers in broader definitions of those who are able to participate in DCAs and most prohibit a dental provider from additionally billing insurance for services included in a DCA. Over the past several years, at least four states have passed legislation to expand DCAs beyond primary care into dental settings specifically. For example, in 2022, Iowa passed a law specifically including dental services in the definition of healthcare services permitted to be covered by DCAs. In 2025, Texas and Maine both passed laws expanding the scope of DCAs beyond primary care to include services provided by other healthcare practitioners. And in 2026, Alaska introduced legislation to expand DCAs to include dental care along with primary care services.  

While some aspects of DCAs mirror existing concerns and limitations with dental insurance plans, including limitations on covered services and the potential for high cost-sharing, several additional concerns arise with DCAs in dental settings. These include the lack of oversight inherent to an insurance lookalike product that is not regulated as such and the potential for acute discontinuation of care via changes to or insolvency of the agreement.  

Limited Oversight  

Typically, there are no requirements for DCA issuers to register with the state or to collect or report data on the patients they serve or the services they provide. Of the states that have recently passed laws regarding DCAs in dental settings, Iowa, Maine, and Texas all specifically state that DCAs are not insurance and are not subject to licensure or other regulation by relevant state agencies; Texas law additionally states that providers offering DCAs are not insurers and are not subject to regulation by the state Department of Insurance. Such limited oversight can make it difficult to understand if or how patients are receiving the care they need, limit tracking of access to care and oral health outcomes over time, and obscure potential access barriers and inequities. Additionally, limited oversight exists to avoid adverse selection; DCAs include the risk of providers choosing to enter into agreements only with patients who need the lowest level of dental care or the least expensive range of services.  

Iowa, Maine, and Texas law do require DCAs to include specific language informing patients that these agreements are not health insurance. While these notification policies are important for patient education, they can be easy to miss amidst the high paperwork burden presented in dental (and other medical) offices and do not offer material protections once a patient has entered into an agreement. Iowa law additionally prohibits a provider from refusing to accept a new patient, renew a DCA, or add charges based on a pre-existing condition; several other states have similar protections. Again, these protections are helpful to avoid the most egregious forms of discrimination but still exist outside the framework of formal insurance products, which would be legally required to include these protections anyway. Enforcement mechanisms for such minimal protections are also unclear, especially given DCAs exist outside the regulatory framework of insurance products. At least 19 states do not prohibit DCAs from discriminating on the basis of health status and at least 22 do not prohibit DCAs from basing service costs on a patient’s health status.  

Discontinuation of Services 

Typically, there are few, if any, regulations prohibiting a provider who enters into a DCA from dropping a patient and/or discontinuing services at any time for any reason. At least 19 states explicitly allow providers to discontinue a DCA for any reason. This lack of regulation can cause interruptions to care if discontinuation happens before a treatment plan is completed and opens the door for providers to discontinue agreements for patients who use more dental services or need more intensive care. Additionally, discontinuation of DCAs can leave people fully uninsured if an acute or unexpected discontinuation does not align with open enrollment periods. 

Iowa law allows a patient to cancel a DCA at any time, but does require a provider to give a 30-day notice in writing to a patient prior to terminating a DCA. Iowa also requires a refund of prepaid and unused services to the patient upon cancellation. However, as with limited protections related to general oversight, these minimal requirements are insufficient to account for unexpected loss of coverage or access to care upon discontinuation of a DCA on the part of a provider.   

Similarly, Iowa law requires a provider to notify a patient in writing with 60 days notice of any changes to the covered services, access locations, charges, renewal, and other terms to a DCA. As with other educational notices, these policies are necessary but not sufficient to protect patients from unexpected changes to their ability to access the dental care they need. These notices can be easy to miss, especially when sent via mail. Additionally, while it is important for patients to understand if the scope of services covered under their DCA has changed, this does not present alternative options for that patient to receive services that are needed but which are no longer covered. Similarly, refund policies are important to ensure patients do not end up paying for services they do not receive, but do not offer protections for ensuring needed care is provided once a DCA is canceled.  

Risk of Insolvency 

An additional risk to DCAs includes the widespread lack of limitations on the number of patients a provider is free to enter into an agreement with, the number of visits or services covered under a DCA, and the lack of regulation or oversight related to service adequacy. Without such safeguards, limited patient protections exist for situations under which demand for care exceeds a provider’s or practice’s ability to offer the services collectively covered under DCAs the practice has entered into. Without regulation or oversight, DCAs run the risk of agreeing to provide a range of services that fees ultimately do not fully cover.  

Combined with the lack of patient protections around discontinuation of services or agreements in full, the risk of provider insolvency puts consumers at risk of lacking access to any dental care or treatment, even after having paid DCA-related fees. In DCA arrangements that cover primary care services, patients are often advised to use DCAs as a supplement to other insurance; many people forgo this option anyway, but combining a DCA with other insurance coverage is additionally unlikely for dental care given that the primary benefit for dental DCAs are their ostensible ability to act as an alternative to the existing limitations of dental insurance.   

Limited Scope of Services 

Limited regulation and oversight of DCAs mean a dearth of requirements around scope of covered services, including lack of a floor for necessary preventive or routine restorative care. A DCA that covers only a limited scope of services may leave people unable to get and/or afford care that isn’t covered, especially if they have foregone other insurance. Without standardization of covered benefits, people may enter into a DCA without insight into services that may become medically necessary in the future. Combined with the ability of DCAs to be terminated at any time and without adherence to open enrollment timelines, the limitations of these products threaten to leave people having paid for access that cannot be fulfilled.  

Limitations in scope of covered services can also exacerbate the risks of starting care that cannot ultimately be completed. For example, if a DCA covers preventive and basic dental care, but an exam reveals the need for more intensive restorative services that aren’t included, a patient may find themselves unable to afford to pay out of pocket for those services and unable to enroll in other coverage, either because they’re outside of open enrollment or because they cannot afford the monthly DCA fee plus monthly insurance premiums. This barrier is not necessarily unique to DCAs – limitations on covered services exist with dental insurance products, especially for working age adults, and it is not uncommon for people with dental insurance to lack coverage for the full range of services they need to maintain their oral health. However, DCAs do not add additional protections or coverage and do come with other limitations, making them a risky alternative to insurance, even where that coverage may also have limitations.  

Real Policy Solutions to Improve Affordability of and Access to Dental Care  

Insurance alternatives like medical credit cards and DCAs flourish because of a dental coverage environment that does not meet people’s needs and are part of broader trends in the health and dental coverage space to offer alternatives to insurance products that put patients at risk. While these products may sometimes present an option for people to get care they couldn’t otherwise afford, healthcare advocates should be focused on solving the root problem of the dental affordability and medical debt crises, rather than allowing alternatives that take advantage of current dental coverage limitations. The right policy question should not be, “are DCAs worse than traditional dental insurance?”, but rather, “what additional benefits do these products offer and do they outweigh the additional risks?” On DCAs, the answer is squarely “No.”  

While some states have instituted protections against the most harmful DCA practices, including those described above related to patient education and notifications, as well as at least one state Attorney General opinion (GA) outlining circumstances under which a dental DCA would constitute insurance and be required to be regulated as such (i.e., if they offer discounted services), these limited protections put a band-aid on a much broader problem. Rather than relying on workarounds like DCAs or medical credit cards, real policy solutions to improve access to and affordability of dental care are needed.   

The right policy question should not be, “are DCAs worse than traditional dental insurance?”, but rather, “what additional benefits do these products offer and do they outweigh the additional risks?” On DCAs, the answer is squarely, “No.”

Regulate Dental Insurance Like Other Private Insurance Products  

Many of the risks inherent to DCAs also exist, to some extent, with private dental insurance products, in large part because SADPs are not subject to the major consumer protections that apply to other health insurance products. In particular, private dental coverage for adults does not have to limit out-of-pocket costs, nor are there restrictions on annual or lifetime benefit limits. Addressing these limitations comprehensively would be best achieved by classifying adult dental services as an essential health benefits (EHB) category at the federal level. EHB status would extend key consumer protections to dental insurance products and mirror the protections already required for children’s dental coverage, as well as many other categories of healthcare services.  

In lieu of federal EHB status, a network of other policy solutions could achieve the same ends, including Congress passing standalone legislation to extend key consumer protections to SADPs, removal of the existing regulatory prohibition on states’ ability to optionally add adult dental services as an EHB, and allowing independent purchase of SADPs on the federal ACA Marketplace.  

Make Adult Dental Care a Mandatory Medicaid Coverage Category  

Limitations to accessing dental care also exist for people with Medicaid coverage. Because, by definition, this population is primarily low-income, they also are most at risk for the negative repercussions of DCAs if they are used as an alternative to dental coverage through Medicaid. Ensuring Medicaid adult dental benefits (MADBs) are comprehensive and accessible can limit the market for risky products like DCAs. This would best be achieved via congressional legislation to make MADBs a mandatory coverage category and to set a standardized, comprehensive benefit package at the federal level (which states could go beyond). In the interim, states can and should maximize optional MADB coverage by covering a comprehensive set of services with no annual benefit maximum. States should also consider options for maintaining MADBs and current provider reimbursement rates in light of changes to Medicaid at the federal level. 

Add a Comprehensive Dental Benefit to Medicare  

Without coverage of almost any meaningful routine dental care in Medicare, older adults and people with disabilities remain open to the risks associated with DCAs where they are marketed as an alternative to dental coverage. The impact of inaccessible and unaffordable dental care is particularly high for the Medicare-covered population, who already face additional financial barriers and particular challenges in accessing care by nature of their age and/or disability status. Adding a comprehensive dental benefit to Medicare Part B would improve access to affordable dental care for vulnerable adults and reduce the risks associated with loosely regulated alternatives like DCAs.  

Conclusion 

The artificial separation of oral health from the rest of the healthcare system creates ongoing issues for access to and affordability of dental care, which is critical for overall health and economic wellbeing. In particular, the lack of required adult dental coverage in major public and private coverage arrangements leaves the door open for loosely-regulated insurance alternatives, like DCAs, that put consumers at risk.  

Without regulation and oversight, DCAs can offer slimmer coverage, be canceled unexpectedly, and put people at increased risk for interrupted care, uncovered services, and medical debt. Even the somewhat narrow protections traditional dental insurance provides are stripped away under DCAs. Limited state-level protections, disclosure requirements, and cancellation notices can soften the sharpest edges of these arrangements, but they are not a reasonable substitute for structural change. Real solutions lie in closing the coverage gaps that make DCAs attractive in the first place: making comprehensive adult dental coverage a mandatory part of Medicaid, Medicare, and private coverage so that people can afford and access the dental care they need and rely on reasonable patient protections. Until policymakers address dental care as the essential healthcare service it is, patients will continue to be pushed toward alternatives that promise access, but too often only deliver additional risk.