Update (5/23/25): If you missed the notification deadline from your insurance company and were defaulted to receiving virtual credit card payments, do not process or deposit the payment if you’ve received one. Doing so may make it more difficult to revert to your preferred payment method. Contact the insurance company immediately to request a change. If you encounter any issues, please reach out to NJDA’s Dental Practice and Health Policy Coordinator, Javier Perez (jperez@njda.org, 732-422-2709), to inform us of the challenge.

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As a reminder, thanks to NJDA’s advocacy, S.3133/A.4913, was signed into law on January 8, 2024. This law requires health insurance carriers to reimburse health care providers using checks or electronic funds transfer (EFT), ensuring that dental practices are protected from being forced into costly virtual credit card (VCC) payments.

Quick Recap:

• Bill Passed Assembly: 6/30/23
• Bill Passed Senate: 12/21/23
• Signed into Law: 1/8/24

NJDA’s Position:
We fully supported this law, which prohibits insurance companies from issuing virtual credit cards as the default payment method. This practice, which had been growing across the industry, often resulted in higher processing fees than typical credit or debit card payments—unfairly burdening dental practices. Our stance remains firm: you should not be paying unnecessary fees for claims payments when no-cost options like ACH (EFT) and paper checks exist. New Jersey joins a growing list of states that have taken action to stop virtual credit card payments, including Alabama, Arizona, Connecticut, Georgia, Louisiana, Maryland, Missouri, Nebraska, North Carolina, Oklahoma, Oregon, Texas, Utah and more!

We are now hearing reports that some insurance companies are using third-party processors to bypass the intent of this law.

For example, we have received inquiries from some members that insurance carriers are using third-party payment processing companies to distribute reimbursements. In some cases, the carrier is notifying their network dentists to select a preferred payment method; otherwise, Virtual Credit Card payments will be issued by default unless you actively choose another option.

Important:
This practice works around New Jersey law by engaging a third party to manage reimbursement payments. While technically a workaround, it raises significant concerns and may still unfairly pressure your office into accepting higher-fee payment methods.

What You Should Do:

• Watch your email carefully for communications about payment option changes.
  
• If you receive a notice stating that Virtual Credit Cards will be the default:
1. Keep a copy of the communication for your records.
2. Contact NJDA immediately to report the issue.
   ➔ Contact: jperez@njda.org, Dental Practice and Health Policy Coordinator.
3. Update your payment preferences proactively (EFT or check) to ensure you are receiving payments through a no-cost method.

We continue to monitor insurer compliance and are prepared to elevate these matters with state regulators as needed. Your vigilance is critical in holding insurance companies accountable.

Thank you for your continued attention to this important issue.