dental insurers; dental practice; prohibition, the official text

House Engrossed

dental insurers;
dental practice; prohibition

State of Arizona

House of Representatives

Fifty-seventh Legislature

Second Regular Session

2026

HOUSE BILL 2308

AN
ACT

Amending section 32-1213, Arizona
Revised Statutes; relating to the state board of dental examiners.

(TEXT OF BILL BEGINS ON NEXT PAGE)

Be it
enacted by the Legislature of the State of Arizona:

Section 1.1. Section
32-1213, Arizona Revised Statutes, is amended to read:

START_STATUTE32-1213. Business entities; registration; renewal; civil penalty;
exceptions; definitions

A. A business entity may not offer dental services
pursuant to this chapter unless:

1. The business entity is registered with the board
pursuant to this section.

2. The services are conducted by a licensee pursuant
to this chapter.

B. The business entity must file a registration
application on a form provided by the board. The application must include:

1. A description of the business entity's services
offered to the public.

2. The name of any dentist who is authorized to
provide and who is responsible for providing the dental services offered at
each office.

3. The names and addresses of the officers and
directors of the business entity.

4. The name of the business entity's custodian of
records.

5. A registration fee prescribed by the board in
rule.

C. A business entity must file a separate
registration application and pay a fee for each branch office in this state.

D. A registration expires three years after the date
the board issues the registration. A business entity that wishes to
renew a registration must submit an application for renewal as prescribed by
the board on a triennial basis on a form provided by the board before the
expiration date. A business entity that fails to renew the
registration before the expiration date is subject to a late fee as prescribed
by the board by rule. The board may stagger the dates for renewal applications.

E. The business entity must notify the board in
writing within thirty days after any change:

1. In the business entity's name, address or
telephone number.

2. In the officers or directors of the business
entity.

3. In the name of any dentist who is authorized to
provide and who is responsible for providing the dental services in any
facility.

4. In the name of the business
entity's custodian of records who will accept subpoenas and respond to patient
records requests.

F. The business entity shall establish a written
protocol for the secure storage, transfer and access of the dental records of
the business entity's patients. This protocol must include, at a
minimum, procedures for:

1. Notifying patients of the future locations of
their records if the business entity terminates or sells the practice.

2. Disposing of
unclaimed dental records.

3. The timely
response to requests by patients for copies of their records.

G. The business entity must notify the board within
thirty days after the dissolution of any registered business entity or the
closing or relocation of any facility and must disclose to the board the
business entity's procedure by which its patients may obtain their records.

H. The board may do any of the following pursuant to
its disciplinary procedures if a business entity violates the board's statutes
or rules:

1. Refuse to issue a registration.

2. Suspend or revoke a registration.

3. Impose a civil penalty of not more than $2,000
for each violation.

4. Enter a decree of censure.

5. Issue an order prescribing a period and terms of
probation that are best adapted to protect the public welfare and that may
include a requirement for restitution to a patient for a violation of this
chapter or rules adopted pursuant to this chapter.

6. Issue a letter of concern if a business entity's
actions may cause the board to take disciplinary action.

I. The board shall deposit, pursuant to sections 35-146
and 35-147, civil penalties collected pursuant to this section in the
state general fund.

J. except as provided in subsection O
of this section, this section does not apply to:

1. A sole proprietorship or partnership that
consists exclusively of dentists who are licensed pursuant to this chapter.

2. Any of the following entities licensed under
title 20:

(a) A service corporation.

(b) An insurer authorized to transact disability
insurance.

(c) A prepaid dental plan organization that does not
provide directly for prepaid dental services.

(d) A health care services organization that does
not provide directly for dental services.

3. A professional corporation or professional
limited liability company, the shares of which are exclusively owned by
dentists who are licensed pursuant to this chapter and that is formed to engage
in the practice of dentistry pursuant to title 10, chapter 20 or title 29
relating to professional limited liability companies.

4. A facility regulated by the federal government or
a state, district or territory of the United States.

5. An administrator
or executor of the estate of a deceased dentist or a person who is legally
authorized to act for a dentist who has been adjudicated to be mentally
incompetent for not more than one year after the date the board receives notice
of the dentist's death or incapacitation pursuant to section 32-1270.

K. A facility that offers dental services to the
public by persons licensed under this chapter shall be registered by the board
unless the facility is any of the following:

1. Owned by a dentist who is licensed pursuant to
this chapter.

2. Regulated by the federal government or a state,
district or territory of the United States.

L. Except for issues relating to insurance coding
and billing that require the name, signature and license number of the dentist
providing treatment, this section does not:

1. Authorize a licensee in the course of providing
dental services for a business entity registered pursuant to this section to
disregard or interfere with a policy or practice established by the business
entity for the operation and management of the business.

2. Authorize a business entity registered pursuant
to this section to establish or enforce a business policy or practice that may
interfere with the clinical judgment of the licensee in providing dental
services for the business entity or may compromise a licensee's ability to
comply with this chapter.

M. The board shall adopt rules that provide a method
for the board to receive the assistance and advice of business entities
licensed pursuant to this chapter in all matters relating to the regulation of
business entities.

N. An individual currently holding a surrendered or
revoked license to practice dentistry or dental hygiene in any state or
jurisdiction in the United States may not have a majority ownership interest in
the business entity registered pursuant to this section. Revocation
and surrender of licensure shall be limited to disciplinary actions resulting
in loss of license or surrender of license instead of disciplinary action.
Dentists or dental hygienists affected by this subsection shall have one year
after the surrender or revocation to divest themselves of their ownership
interest. This subsection does not apply to publicly held
companies. For the purposes of this subsection, "majority
ownership interest" means an ownership interest greater than fifty
percent.

O. A dental insurer or a holding
company OF A DENTAL INSURER may not have any ownership
interest in a business organization that offers to the public professional
services regulated by the board.

P. For the purposes of this section:

1. "Dental insurer" has the
same meaning prescribed in section 20-126.

2. "Holding company" means
a corporation, firm, partnership, limited partnership, limited liability
company, trust or other form of business organization that is not an individual
and that directly or indirectly does either of the following:

(a) Holds an
ownership interest of ten percent or more, as determined by the holding
company's board, in a dental insurer.

(b) Holds
voting rights with the power to vote ten percent or more of the outstanding
voting rights of a dental insurer. END_STATUTE