Iowa Dental Association v. Iowa Insurance Division and Iowa Insurance Commissioner

IN THE SUPREME COURT OF IOWA
No. 12–1280

Filed May 17, 2013

IOWA DENTAL ASSOCIATION,

Appellant,

vs.

IOWA INSURANCE DIVISION and IOWA INSURANCE COMMISSIONER,

Appellees,

and

FEDERATION OF IOWA INSURERS,

Intervenor–Appellee.

Appeal from the Iowa District Court for Polk County, Mary Pat

Gunderson, Judge.

A trade association representing Iowa dentists appeals the district

court’s ruling upholding a declaratory order of the Iowa Insurance

Commissioner. REVERSED AND REMANDED.

Rebecca A. Brommel of Brown, Winick, Graves, Gross, Baskerville

and Schoenebaum, P.L.C., Des Moines, for appellant.

Thomas J. Miller, Attorney General, and Jeanie Kunkle Vaudt,

Assistant Attorney General, for appellees.
 2

Scott A. Sundstrom of Nyemaster Goode, P.C., Des Moines, for

intervenor–appellee.
 3

MANSFIELD, Justice.

This case asks us to decide whether to uphold the Iowa Insurance

Commissioner’s interpretation of a recently enacted law governing dental

insurance plans. See Iowa Code § 514C.3B (2011). Under the

Commissioner’s interpretation of that law, an insurer may limit the

maximum fees charged by dentists for services that are generally

included in the insurer’s dental plan, even though they are not actually

reimbursed by the insurer because of a plan restriction.

On our review, we find that interpretation of the term at issue has
not been clearly vested by a provision of law in the discretion of the

Commissioner. Therefore, de novo review is appropriate. See id.

§ 17A.19(10)(c). We then conclude that the services in question do not

meet the statutory definition of “covered services,” because they have not

been “reimbursed under the dental plan.” See id. § 514C.3B(3)(a).

Accordingly, the fee for them may not be “set by the dental plan.” See id.

§ 514C.3B(1). For these reasons, we reverse the decision of the district

court upholding the Commissioner’s declaratory ruling and remand for

further proceedings consistent herewith.

I. Facts and Procedural Background.

This case centers on the contractual relationships between dentists

and insurers that provide dental plans. Many dentists in Iowa enter into

these plans, under which insurers reimburse all or part of the costs of

various dental procedures. Typically the plan contracts include

maximum fee schedules. In the schedule, the insurer sets a maximum

amount the dentist can charge for a particular service. Dentists agree to

abide by these maximum fees, in exchange for the benefit of providing

services to insured patients.
 4

Generally, the plans exclude certain services, such as cosmetic

dentistry and teeth whitening. Preventive plans have additional

exclusions. But even when services are covered, there may be limits

such as deductibles, maximum annual benefits, waiting periods, and

frequency limitations. A common frequency limitation is that patients

may be reimbursed for up to two teeth cleanings per year, but not for a

third cleaning within that same time period.

Before the general assembly passed section 514C.3B, some dental

plans contained maximum fees that dentists could charge for services
that were never reimbursable under their dental insurance plans, like

teeth whitening. In 2010, and in apparent response to this practice, the

legislature adopted “An Act prohibiting the imposition by a dental plan of

fee schedules for the provision of dental services that are not covered by

the plan.” 2010 Iowa Acts ch. 1179 (codified at Iowa Code § 514C.3B).

Iowa’s law provides:

A contract between a dental plan and a dentist for the
provision of services to covered individuals under the plan
shall not require that a dentist provide services to those
covered individuals at a fee set by the dental plan unless
such services are covered services under the dental plan.

Iowa Code § 514C.3B(1). The statute contains the following definition of

“covered services”:

“Covered services” means services reimbursed under the
dental plan.

Id. § 514C.3B(3)(b). And a final subsection of the statute states:

Nothing in this section shall be construed as limiting the
ability of an insurer or a third-party administrator to restrict
any of the following as they relate to covered services:

a. Balance billing.

b. Waiting periods.
 5
c. Frequency limitations.

d. Deductibles.

e. Maximum annual benefits.

Id. § 514C.3B(4).

Following enactment of this law, insurers continued imposing

maximum fees on services that were actually reimbursed under their

dental plans, such as semiannual teeth cleanings. But some insurers

went further. They placed maximum fees on services that were

potentially reimbursable but were not actually reimbursed because of
some plan limit, such as a frequency limit. For example, an insurer

would require a dentist to charge no more than a certain amount for any

teeth cleaning, even though only the first two cleanings were actually

reimbursed under the plan.

According to the Iowa Dental Association (IDA), the petitioner in

this action, a number of its dentist–members inquired to insurers about

maximum fees on these reimbursable, but not actually reimbursed,

services. The insurers responded that such services were “covered

services” under section 514C.3B(3)(a), and could accordingly be subject

to their fee schedules, even though they were not being reimbursed in a

particular instance.

The IDA argued that dentists faced “conflicting interpretations” of

the statute: the dentists’ own interpretation that such services were not

“covered,” and the insurers’ view that they were. Accordingly, on

August 19, 2011, the IDA filed with the Insurance Division a request for

a declaratory order clarifying the meaning of “covered services” in section

514C.3B. See id. § 17A.9 (setting forth the procedure for seeking a

declaratory order from an agency). The IDA specifically requested an

answer to the following question:
 6
Is an insurer permitted to impose and enforce a
maximum fee for services that are not reimbursed under the
dental plan (except for standard co-payments or deductibles
paid by the patient) due to limitations related to balance
billing, waiting periods, frequency limitations, deductibles,
and maximum annual benefits?

The IDA proposed that the Commissioner answer the question in the

negative, based on its reading of the statute’s definition of “covered

services.”

The Federation of Iowa Insurers—which represents dental plan

providers Wellmark Blue Cross and Blue Shield of Iowa, Delta Dental of

Iowa, and the Principal Financial Group—petitioned to intervene in the

matter. After its petition was granted, the Federation submitted briefs

urging the Commissioner to answer the IDA’s question in the affirmative.

On November 8, the Insurance Commissioner issued a declaratory

order that agreed with the Federation’s position: “covered services”

include services that can be reimbursed generally, but that are not

actually reimbursed in a particular circumstance due to a policy

restriction. The Commissioner reasoned that this reading gave meaning

to section 514C.3B(4) and also better served customers because it

allowed insurers to keep prices down. As the Commissioner explained,

Subsection 3 must be read in conjunction with subsection 4,
to give meaning to the entire statute, which places several
limitations on covered services related to balance billing,
waiting periods, frequency limitations, deductibles, and
maximum annual benefits. Subsection 4 indicates that the
“covered service” does not lose its status as a covered service
because of limitations placed on reimbursement to the
dentist. Thus, the statute does not require . . . a service to
actually be reimbursed under the dental plan. Stated
another way, non-covered benefits are dental procedures
that a dental plan does not cover and never pays for.

This determination fits well within the context of the
consumer’s dental insurance contract.

....
 7
Patients benefit when there [i]s certainty in the amount that
will be paid for a given service. They lack the expertise to
discuss and/or negotiate dental fees with the dentists that
do not fall within the definition of covered services. A patient
could end up paying significantly more than the negotiated
fee between the insurer and dentist without the benefit of the
insurer’s contract with the dentist.

On December 11, the IDA filed a petition in Polk County District

Court requesting judicial review of the Commissioner’s order. The IDA’s

petition advanced several alternative arguments: (1) the Commissioner

lacked clearly vested interpretive authority over the statutory term

“covered services” and her ruling was erroneous; (2) the Commissioner,

even if clearly vested with authority, issued an illogical, irrational, and

unjustifiable order; (3) the Commissioner failed to consider a relevant

matter—namely the meaning of the term “reimbursed”; and (4) the

Commissioner’s action was otherwise unreasonable, arbitrary,

capricious, or an abuse of discretion.

The Federation filed a brief in opposition. It argued the district

court should uphold the ruling because the Commissioner was clearly

vested with interpretive authority and the ruling was neither illogical,

irrational, nor unjustifiable. The Federation also asserted that the

Commissioner’s ruling was correct even if the court employed a less

deferential standard of review. Finally, the Federation highlighted policy

concerns and insisted that the IDA’s interpretation was anti-consumer

because it would allow dentists to charge insured customers higher fees

on policy-limited services, such as a third teeth cleaning.

The district court affirmed the Commissioner’s declaratory ruling.

The court relied on Iowa Code chapter 505 to conclude that the

Insurance Commissioner had been clearly vested with interpretive

authority. Section 505.8(2), in particular, provides:
 8
The commissioner shall, subject to chapter 17A, establish,
publish, and enforce rules not inconsistent with law for the
enforcement of this subtitle and for the enforcement of the
laws, the administration and supervision of which are
imposed on the division, including rules to establish fees
sufficient to administer the laws, where appropriate fees are
not otherwise provided for in rule or statute.

Id. § 505.8(2). The court next read section 514C.3B(3) in conjunction

with section 514C.3B(4) to conclude that the Commissioner’s

interpretation of “covered services” was not irrational, illogical, or wholly

unjustifiable.

The IDA now appeals and the parties make essentially the same

arguments before us. At issue here is whether to affirm the

Commissioner’s declaratory order that dental services ordinarily

reimbursable, but not actually reimbursed due to some plan policy limit,

are “covered services” under section 514C.3B.

II. Scope of Review.

This is an appeal of a district court’s review of agency action; Iowa

Code section 17A.19 determines the standard of review to apply. See id.

§ 17A.19(10). Section 17A.19(10) states, in relevant part:

10. The court may affirm the agency action or remand
to the agency for further proceedings. The court shall
reverse, modify, or grant other appropriate relief from agency
action, equitable or legal and including declaratory relief, if it
determines that substantial rights of the person seeking
judicial relief have been prejudiced because the agency
action is any of the following:

....

c. Based upon an erroneous interpretation of a
provision of law whose interpretation has not clearly been
vested by a provision of law in the discretion of the agency.

....

l. Based upon an irrational, illogical, or wholly
unjustifiable interpretation of a provision of law whose
 9
interpretation has clearly been vested by a provision of law
in the discretion of the agency.

....

n. Otherwise unreasonable, arbitrary, capricious, or
an abuse of discretion.

Id.

We accordingly review an agency’s interpretation of a provision of

law under either the highly deferential “irrational, illogical, or wholly

unjustifiable” standard, or the nondeferential errors-at-law standard. We

give deference to an agency only if our legislature clearly vested authority

to interpret the provision with the agency. Iowa Code § 17A.10(l).

Otherwise, we review for erroneous interpretations of law. Id.

§ 17A.10(c).

Although the district court’s thorough decision appears to focus

largely on whether the Commissioner has been clearly vested with

authority to interpret the 2010 legislation, i.e., section 514C.3B, we have

clarified the nature of the relevant inquiry in recent years. In Renda v.

Iowa Civil Rights Commission, we had to decide whether the Iowa Civil

Rights Commission (ICRC) had jurisdiction over an inmate’s civil rights
claim alleging discrimination in employment and housing. 784 N.W.2d

8, 9 (Iowa 2010). At issue was whether the inmate was an “employee”

and whether the correctional facility was a “dwelling” within the meaning

of the Iowa Civil Rights Act. Id. at 9. We explained:

We begin by noting that despite the parties’
articulation of the issue as whether the ICRC has the
authority to interpret the Act, we do not view the issue so
broadly. The focus of our inquiry is not whether the ICRC
has the authority to interpret the entire Act. Rather, we
must determine whether the interpretation of the specific
terms “employee” and “dwelling” has been clearly vested in
the discretion of the commission.
 10

Id. at 10.

We then reviewed our precedents and found they confirmed this

approach. Id. at 11–13. In prior cases, despite grants of rulemaking

authority to the agencies in question, we had not found that the agencies

had been vested with the authority to interpret terms such as competent

evidence, hardship, public interest, willful, and confidential. Id. at 13.

We did note that an express legislative grant of authority to interpret the

statute could resolve the issue. Id. at 11. But a grant of rulemaking

authority alone was generally not sufficient. Id. at 13.
We further noted that when a statutory provision “is a substantive

term within the special expertise of the agency, we have concluded that

the agency has been vested with the authority to interpret the

provisions.” Id. at 14. But when the term is found in other statutes or

has “an independent legal definition that is not uniquely within the

subject matter expertise of the agency, we generally [have] conclude[d]

the agency has not been vested with interpretive authority.” Id.

Applying these principles, we held in Renda that the ICRC was not

clearly vested with authority to interpret “employee” and “dwelling.” Id.

There was no express grant of interpretive authority in the underlying

legislation, and “[b]oth terms have specialized legal meaning and are

widely used in areas of law other than the civil rights arena.” Id.

A year after Renda, we had to decide whether a paint company was

exempt from use tax on purchases of machines it used in its Iowa retail

outlets to mix base paint with colorant. See Sherwin-Williams Co. v. Iowa

Dep’t of Revenue, 789 N.W.2d 417, 419 (Iowa 2010). The issue was

whether a retail establishment could be considered a “manufacturer”

within the meaning of Iowa’s use tax law. Id. at 423. “Manufacturer”

was defined in the statute. See id. at 420 (citing Iowa Code § 428.20).
 11

We ultimately concluded that interpretive authority had not been vested

in the department of revenue for the following reasons:

The insurmountable obstacle to finding the department has
authority to interpret the word “manufacturer” in this
context is the fact that this word has already been
interpreted, i.e., explained, by the legislature through its
enactment of a statutory definition. See id.
§§ 422.45(27)(d)(4), 428.20. Under these circumstances, we
do not think the legislature intended that the department
have discretion to interpret—give meaning to—this term.

Id. at 423–24.

On the other hand, in Evercom Systems, Inc. v. Iowa Utilities Board,

we found the utilities board had been vested with authority to interpret

the term “unauthorized change in service.” 805 N.W.2d 758, 762–63

(Iowa 2011). The underlying legislation required the Board to “adopt

rules prohibiting an unauthorized change in telecommunication service”;

we did not consider that “an explicit grant of the authority to interpret

the term.” Id. at 762. However, in light of our precedent and the fact

that “unauthorized change in service” was a “substantive term within the

special expertise of the agency,” we held that authority had been vested

with the board and a deferential standard of review should apply. Id. at

762–63.

In Neal v. Annett Holdings, Inc., we had to address the meaning of

the phrase “suitable work” in a workers’ compensation case. 814 N.W.2d

512, 516 (Iowa 2012). Although the commissioner had been expressly

granted statutory authority to “[a]dopt and enforce rules necessary to

implement” the workers’ compensation laws, we reiterated that “the mere

grant of rulemaking authority does not give an agency authority to

interpret all statutory language.” Id. at 519 (citation and internal

quotation marks omitted). We noted that the concept of “suitable work”

is found in other legal contexts and “has a specialized legal meaning
 12

extending beyond the context presented in this case.” Id. Accordingly,

we did not give deference to the commissioner’s interpretation of the

phrase. Id.

In Burton v. Hilltop Care Center, we held that the legislature, which

had provided an independent statutory definition of “gross earnings,” did

not clearly vest interpretive authority for that term in the workers’

compensation commissioner. 813 N.W.2d 250, 261–62 (Iowa 2012).

Instead we applied a de novo standard of review and focused on whether

inadvertent overpayments met the legislative definition of “gross
earnings”—“payments by employer to the employee for employment.” Id.

at 261 (citation and internal quotation marks omitted). Ultimately we

concluded, “Money received due to an accounting error would not be

money that was earned for employment as the statute requires.” Id. at

263.

Applying Renda and its progeny here, we find that interpretive

authority concerning the phrase “covered services” has not been clearly

vested with the Insurance Commissioner. As noted by the district court,

the legislature has given the Commissioner the power to make rules “not

inconsistent with law for the enforcement of this subtitle and for the

enforcement of the laws, the administration and supervision of which are

imposed on the division.” Iowa Code § 505.8(2). However, granting the

authority to make rules for enforcement purposes is not the same as

granting authority to make interpretive rules. In the workers’

compensation field, we have said that the commissioner’s express

statutory authority to “[a]dopt and enforce rules necessary to implement

this chapter and chapters 85, 85A, 85B, and 87,” id. § 86.8 (emphasis

added), does not by itself amount to a vesting of interpretive authority.
 13

See Waldinger Corp. v. Mettler, 817 N.W.2d 1, 5 (Iowa 2012); see also

Neal, 814 N.W.2d at 519; Burton, 813 N.W.2d at 261.

Furthermore, as in Sherwin-Williams and Burton, the legislature

has provided its own definition of the term at issue. This presents an

“insurmountable obstacle” to a determination that the insurance

commissioner has been vested with interpretive authority over “covered

services.” Instead, it indicates we ought to apply the legislative definition

ourselves. See Burton, 813 N.W.2d at 261–62.

Additionally, when we turn to the legislative definition, we find that
the relevant word—“reimbursed”—is not a “substantive term within the

special expertise of the agency.” Evercom, 805 N.W.2d at 762 (citation

and internal quotation marks omitted). Rather, the word “reimbursed”

appears hundreds of times within the Iowa Code. For all these reasons,

we will review the Commissioner’s interpretation of the statute for errors

at law.

III. Interpretation of Section 514C.3B.

We have to decide whether services that would be reimbursed but

for a dental plan restriction constitute “covered services,” i.e., “services

reimbursed under the dental plan.” Iowa Code § 514C.3B(3)(a). The

Commissioner concluded that “the statute does not require that a service

. . . actually be reimbursed under the dental plan.” On our review of the

matter, we reach a different conclusion.

The parties here essentially dispute the significance of the word

“reimbursed,” which has no definition in the statute. “Where the

legislature has not defined words of the statute, we may refer to prior

decisions of this court and others, similar statutes, dictionary definitions,

and common usage.” Bernau v. Iowa Dep’t of Transp., 580 N.W.2d 757,

761 (Iowa 1998). The IDA argues the definition includes only services
 14

that are actually reimbursed under the plan, while the Federation and

the Commissioner argue it includes services that are generally

reimbursed or reimbursable under a plan, whether or not reimbursed in

the specific instance.

When we examine the language of section 514C.3B(3)(a), it appears

to favor the IDA’s position. The word “reimbursed” usually means that

the cost has been repaid. See Merriam–Webster’s Collegiate Dictionary

983 (10th ed. 2002) (“reimburse . . . 1: to pay back to someone : REPAY

<~travel expenses> 2: to make restoration or payment of an equivalent to
<~him for his traveling expenses> . . . .”); see also Black’s Law Dictionary

1399 (9th ed. 2009) (“reimbursement, n. 1. Repayment. 2.

Indemnification.”). When a patient has a third teeth cleaning within a

year, and the dental insurer declines to pay for it, we would not normally

say that the cleaning has been “reimbursed under the dental plan.” Iowa

Code § 514C.3B(3)(a).

This meaning of “covered services” finds implicit support in what

other states have done. Iowa is not the only state to have enacted

legislation that prevents dental insurers from imposing maximum fees on

noncovered services. The first to do so was Rhode Island in 2009. See

2009 R.I. Pub. Laws chs. 09–41, 09–52. There the statute defined

“covered services” as “services reimbursable under the applicable

subscriber agreement, subject to such contractual limitations on

subscriber benefits as may apply, including, for example, deductibles,

waiting period or frequency limitations.” See R.I. Gen. Laws Ann. § 23-

17.13-6(a) (Supp. 2012).

During their respective 2010 legislative sessions, but before Iowa

adopted what became section 514C.3B, Arizona, Idaho, Kansas,

Mississippi, Oklahoma, South Dakota, Virginia, and Washington all
 15

enacted laws that limited the imposition of maximum fees on noncovered

dental services and defined “covered services.” Six of these states

(Kansas, Mississippi, Oklahoma, Rhode Island, South Dakota, and

Washington) used the term “reimbursable.”1 The other three (Arizona,

Idaho, and Virginia) expressed the same concept, although in different

verbiage.2 None of these nine states used the term “reimbursed.” Thus,

1See Kan. Stat. Ann. § 40–2,186(a) (Supp. 2011) (“ ‘Covered service’ means a
service which is reimbursable under the health benefit plan subject to any deductible,
coinsurance, waiting period, frequency limitation, annual or lifetime benefit maximum
or other contractual limitation contained in the health benefit plan.” (Emphasis
added.)); Miss. Code Ann. § 83–51–31 (West Supp. 2012) (“For the purposes of this
section, ‘covered services’ means services that are reimbursable under the applicable
subscriber agreement, notwithstanding any deductibles, waiting periods or frequency
limitations that may apply.” (Emphasis added.)); Okla. Stat. Ann. tit. 36, § 7301 (West
Supp. 2013) (“ ‘Covered services’ means services reimbursable under the applicable
subscriber agreement, subject to the contractual limitations on subscriber benefits as
may apply, including, for example, deductibles, waiting period or frequency limitations
. . . .” (Emphasis added.)); R.I. Gen. Laws Ann. § 23-17.13-6(a) (“ ‘Covered services,’ as
used herein, means services reimbursable under the applicable subscriber agreement,
subject to such contractual limitations on subscriber benefits as may apply, including,
for example, deductibles, waiting period or frequency limitations.” (Emphasis added.));
S.D. Codified Laws § 58-17-146 (Supp. 2012) (“For the purposes of this section, the
term, covered services, means services reimbursable under the plan, policy, or contract,
subject to such contractual limitations on benefits as may apply, including deductibles,
waiting periods, frequency limitations, or charges over the benefit maximum.”
(Emphasis added.)); Wash. Rev. Code Ann. § 48.21.147(2) (Supp. 2012) (“For the
purposes of this section, ‘covered services’ means dental services that are reimbursable
under the applicable insurance policy, group plan, or subscriber agreement or would be
reimbursable but for the application of contractual limitations such as benefit
maximums, deductibles, coinsurance, waiting periods or frequency limitations.”
(Emphasis added.)).
2Ariz. Rev. Stat. Ann. § 20-847 (West Supp. 2012) (“For the purposes of this
section, ‘covered service’ means a service for which any reimbursement is available
under a subscription contract without regard to contractual limitations by a deductible,
copayment, coinsurance, waiting period, annual or lifetime maximum, frequency
limitation, alternative benefit payment, exclusion or other limitation.”); Idaho Code Ann.
§ 41-1849(1) (2010) (“ ‘Covered services’ as used in this section means services under
the applicable dental plan, dental plan contract or plan benefits subject to such
contractual limitations on benefits of the dental plan, dental plan contracts or plan
benefits as may apply.”); Va. Code Ann. § 38.2–3407.17(A) (Supp. 2012) (“ ‘Covered
services’ means the health care services for which benefits under a policy, contract, or
evidence of coverage are payable by a dental plan, including services paid by the
insureds, subscribers, or enrollees because the annual or periodic payment maximum
established by the dental plan has been met.”).
 16

our general assembly apparently had other templates available if it had

wanted to clearly prohibit dental plans from imposing maximum fees on

services that would have been reimbursed but for a plan limitation.

Instead of using language that paralleled that of the other states, our

legislature defined “covered services” to mean “services reimbursed under

the dental plan.”

Of course, we must construe section 514C.3B in its entirety. See

State v. Adams, 810 N.W.2d 365, 369 (Iowa 2012). Also, legislative

history should be taken into account in construing an ambiguous
statute. See Iowa Code § 4.6(3). In this regard, the Federation and the

Commissioner point out that section 514C.3B was amended to add

subsection 4 during the legislative process.3 As noted above, that

subsection reads:

3The original legislation (HF 2229) passed the House without subsection 4 on
February 24, 2010 on a vote of 93–1. See H. Journal, 83rd G.A., 2d Sess., at 711–12
(Iowa 2010) [hereinafter H. Journal]; H.F. 2229 (Introduced), 83rd G.A., 2d Sess. (Iowa
2010). On March 10, on the Senate floor, Senator McCoy offered an amendment (S-
5185) to add the following version of subsection 4:
Nothing in this section shall be construed as limiting the ability of an
insurer or a third-party administrator to restrict balance billing, waiting
periods, frequency limitations, and deductibles.
S. Amendment 5185, 83rd G.A., 2d Sess. (Iowa 2010); see S. Journal, 83rd G.A., 2d
Sess. at 768 (Iowa 2010) [hereinafter S. Journal].
Senator Warnstadt then immediately offered an amendment to Senator McCoy’s
amendment (S-5233) that contained what became the final version of subsection 4. S.
Journal, at 768; S. Amendment 5233, 83rd G.A., 2d Sess. (Iowa 2010). This was
approved by voice vote. S. Journal, at 768. The amended legislation as a whole passed
the Senate 49–0. See id.
The legislation then returned to the House. In the House, Representative Quirk
filed an amendment (H-8490) as follows:
“Covered services” means services eligible for reimbursement under the
dental plan, including services not otherwise reimbursed because of
applicable contractual limitations, including but not limited to balance
billing, deductibles, waiting periods, frequency limitations, and
maximum annual benefits.
H. Amendment 8490, 83rd G.A., 2d Sess. (Iowa 2010); see H. Journal, at 949.
 17
4. Nothing in this section shall be construed as
limiting the ability of an insurer or a third-party
administrator to restrict any of the following as they relate to
covered services:

a. Balance billing.

b. Waiting periods.

c. Frequency limitations.

d. Deductibles.

e. Maximum annual benefits.

Id. § 514C.3B(4). According to the Commissioner and the Federation,
this provision was added to clarify that “covered services” would still be

considered “covered” for purposes of the statute even if they were not

reimbursed by the plan because of a plan limitation. The Commissioner

and the Federation contend that if subsection 4 does not have this

purpose, it becomes meaningless. We are not persuaded by their

arguments.

As written, subsection 4 does not purport to qualify the definition

of “covered services” in subsection 3—i.e., the requirement that the

services be “reimbursed.” Rather, it purports to clarify that insurers

retain certain rights relating to “covered services.” If this is what it does,

subsection 4 is not meaningless. Thus, subsection 4(a) would indicate
______________________
On March 23, this amendment and several others were withdrawn; another
amendment was defeated by voice vote. H. Journal, at 1172–73. The House then
concurred in the Senate’s amendment and approved the legislation 98–1. See id. at
1173. The Governor signed the legislation on April 29, 2010.

It is difficult to draw definitive conclusions from this legislative history. One
might infer that Senator Warnstadt’s amendment was intended to accomplish
something different from Senator McCoy’s, or that it was just viewed as a better way of
saying the same thing. One might infer that Representative Quirk’s amendment would
have altered the meaning of the statute. In this respect, it would have resembled
several other amendments that were offered at the same time, that presumably were not
supported by the dentists, and that were also withdrawn—i.e., H-8500, H-8502, and H-
8519. H. Journal, at 1123–24, 1173. Or, one might infer that Representative Quirk’s
amendment was withdrawn because it was viewed as unnecessary (unlike those other
amendments).
 18

that an insurer still has the right to limit what a dentist can charge for a

particular service above the insurance reimbursement—so-called balance

billing. For example, a dental plan could reimburse $50 per teeth

cleaning, but also provide that the dentist may charge no more than $60

in total, i.e., can “balance bill” no more than $10. This would be a limit

“relating to” covered services. Likewise, subsections 4(d) and 4(e) would

clarify that an insurer can impose a maximum fee on a service that it

does not entirely reimburse because of a deductible or an annual

maximum. Again, so read, these provisions serve a meaningful purpose.
With regard to subsections 4(b) and 4(c), it is more difficult for IDA

to explain why they are needed. True, insurers would want to have the

ability to continue to impose waiting periods and frequency limitations,

but it is not clear how that might be jeopardized by IDA’s interpretation

of section 514C.3B. The most one can say is that subsections 4(b) and

4(c) clarify that insurers can still impose waiting periods and frequency

limitations as a condition of covering services—in addition to maximum

fees on services they do cover.

On the other hand, the Commissioner and the Federation’s

interpretation of subsection 4 suffers from the same infirmity. If the

purpose of subsection 4 were to clarify that a “ ‘covered service’ does not

lose its status as a covered service because of limitations placed on

reimbursement to the dentist” by the plan, as reasoned by the

Commissioner, then subsections 4(b), (c), (d), and (e) serve a purpose,

but subsection 4(a) on balance billing seems like surplusage. Balance
 19

billing is not a limitation on reimbursement, but on the dentist’s ability

to bill more than the reimbursement.4

Furthermore, the language of subsection 4 does not suggest that

every part of it has to have meaning. It says, “Nothing in this section

shall be construed . . . .” In our experience, this kind of savings

language is sometimes used by a legislature in an abundance of caution,

rather than to resolve a genuine controversy that would exist if the

language were not present. See, e.g., id. § 1.18(6)(c) (“Nothing in this

section shall be construed to . . . [d]isparage any language other than
English . . . .”); id. § 20.26 (“Nothing in this section shall be construed to

prohibit voluntary contributions by individuals to political parties or

candidates.”); id. § 321.276(3) (“Nothing in this section shall be

construed to authorize a peace officer to confiscate a portable electronic

communication device from the driver or occupant of a motor vehicle.”);

id. § 461C.7(2) (“Nothing in this chapter shall be construed to . . .

[r]elieve any person using the land of another for recreational purposes

or urban deer control from any obligation which the person may have in

the absence of this chapter to exercise care in the use of such land and

in the person’s activities thereon, or from the legal consequences of

failure to employ such care.”); id. § 515.103(6)(c) (“Nothing in this

subsection shall be construed to provide a consumer or other insured

with a cause of action that does not exist in the absence of this

subsection.”); id. § 524.821(1) (“Nothing in this section shall be

construed as authority for any person to engage in transactions not

otherwise permitted by applicable law . . . .”).

4Notably, none of the nine out-of-state laws that use the “reimbursable”
approach to “covered services” mention balance billing.
 20

Thus, reading the statute as a whole, we have a straightforward

directive in subsection 3 that covered services must be “reimbursed

under the dental plan,” followed by a somewhat cloudier statement in

subsection 4 that “[n]othing in this section shall be construed as limiting

the ability of an insurer or a third-party administrator to restrict any of

the following as they relate to covered services.” Had the legislature

wanted to provide that insurers could impose maximum fees on services

that were reimbursable, but were not reimbursed in a particular instance

because of a plan limit, it could have said that directly.
The Commissioner and the Federation also argue that their

interpretation of section 514C.3B better protects consumers by allowing

insurers to set a maximum price for a dental procedure even when that

procedure is not covered because of a plan limitation. However, this

argument presumes that in enacting section 514C.3B, the legislature’s

intent was to favor the interests of consumers over those of dentists. It

appears, rather, that the general assembly was trying to balance the

interests of both groups. If the legislature’s only goal had been to avoid a

situation where insured patients might have to pay whatever the dentist

charged without the benefit of a price cap, it would not have enacted

section 514C.3B at all. For this reason, we are unable to give much

weight to this policy argument. The only evident policy of section

514C.3B is to “prohibit[] the imposition by a dental plan of fee schedules

for the provision of dental services that are not covered by the plan.”

2010 Iowa Acts ch. 1179.

Based on our de novo review, we hold that a service is “covered”

within the meaning of section 514C.3B only if it is actually reimbursed to

some extent under the dental plan. Hence, an insurer may only impose
 21

a maximum fee on a service when a reimbursement has been provided

for that service.

IV. Conclusion.

For the foregoing reasons, we conclude the district court erred in

upholding the Commissioner’s declaratory order. We accordingly reverse

the district court’s ruling and remand for proceedings consistent with

this opinion.

REVERSED AND REMANDED.