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Red Flags exemption OK’d

ADA leads dental, medical, business coalition

Washington—The U.S. House of Representatives today passed legislation exempting certain businesses, including dental practices, from the Federal Trade Commission’s Red Flags Rule.

The vote passed with no opposition and now awaits President Obama’s signature.

The U.S. Senate passed an identical bill on Nov. 30. The legislation’s passage was a result of the work of an ADA-led coalition of 28 dental, medical and business groups.

The new legislation will save dental practices money in implementation costs to review and understand identity theft rules. Dentists will also save money and time by not having to train their staff on compliance. The ADA estimates the nationwide savings associated with this exemption to be $72 million for dental offices.

“This legislation is important for practicing dentists who are mindful of their budget and their time. This rule would have put an unnecessary demand on resources and forced dentists to comply with yet another regulation,” said ADA President Dr. Raymond Gist. “The success of this bill is a good example of how working with coalitions strengthens the ADA’s ability to achieve legislative goals.”

The Red Flags Rule requires financial institutions and creditors to develop a written plan to prevent and detect identify theft. The FTC has said that dentists and other health professionals are creditors subject to the regulation depending on their credit arrangements with patients as defined by the Fair and Accurate Credit Transactions Act and must implement a Red Flags program by Jan. 1, 2011.

The ADA has challenged the FTC on that interpretation of the law and its application of the rule to dentists. The ADA maintains neither the FACT Act nor the final rule issued by the FTC specifically mentions dentists or other health care professionals as creditors.

The Red Flags Rule went into effect on Jan. 1, 2008, but the agency delayed enforcement until Congress could address what many in the small business community viewed as unintended consequences. The current delay expires Dec. 31.

The coalition included the Academy of General Dentistry, Ambulatory Surgery Center Association, American Academy of Family Physicians, American Academy of Nurse Practitioners, American Academy of Ophthamology, American Academy of Pediatric Dentistry, American Academy of Periodontology, American Association of Endodontists, American Association for Marriage and Family Therapy, American Association of Neurological Surgeons/Congress of Neurological Surgeons, American Association of Nurse Anesthetists, American Association of Oral and Maxillofacial Surgeons, American Association of Orthodontists, American Chriopractic Association, American College of Prosthodontists, American College of Radiology Association, American Dental Association, American Gastroenterological Association, American Optometric Association, American Physical Therapy Association, American Podiatric Medical Association, American Psychological Association, American Society of Cataract and Refractive Surgery, American Speech-Language-Hearing Association, American Veterinary medical Association, National Association of Social Workers, National Dental Association and U.S. Chamber of Commerce.