Illinois Dental Practices Face New Third-Party Financing Guardrails in 2025

In August, Illinois Gov. J.B. Pritzker signed into law HB 4891 that amends the Illinois Dental Practice Act to include significant guardrails for dental practices looking to offer third-party financing in dental offices in 2025. Notably, these restrictions do not apply to financing and other discount programs offered by dental practices themselves, but likely require dental practices with current third-party financing programs to make significant adjustments. It remains to be seen whether the Illinois Department of Financial and Professional Regulation (IDFPR) will promulgate regulations to further implement this law.

Here are five practical takeaways for the new law that goes into effect on Jan. 1, 2025:

1. No Assistance with the Completion of Financing Applications. Dentists, their employees and agents (DSOs) (collectively, the Dental Office) cannot complete any portion of an application for financing extended by a third party to a patient. Even providing an electronic device at the office for use by a patient to apply for third-party financing constitutes a violation of the new law. Moreover, the Dental Office cannot facilitate the submission of an application to a third-party lender or creditor on a patient's behalf.
2. No Submission of Financing Applications. The Dental Office cannot facilitate the submission of an application to a third-party lender or creditor on a patient's behalf, even if the application has been entirely completed by the patient. If a patient uses patient-facing software or QR codes from a third-party creditor or lender, such software, website and/or materials cannot have a customized interface with the Dental Office's branding.
3. Limitations on Marketing Third-Party Financing Programs. Dental Offices also face limitations on when and where they can market third-party financing programs. Specifically, a Dental Office may not "promote, advertise or provide marketing or application materials" for third-party financing programs to patients who:

• have been or are under the influence of general anesthesia, sedation or nitrous oxide
• are being administered treatment, or
• are in a treatment area, such as an exam room, surgical area or other area, unless a separate area from the treatment area does not exist.

4. Notice Requirement. When discussing third-party financing with a patient or providing applications to a patient, a Dental Office must provide a written disclosure to patients in at least 14-point font that the application is not a payment plan with the Dental Office. IDFPR has made the notice available on its website.
5. Enforcement. Dental Offices should be aware that violations of this new law are punishable by a fine of up to $500 for the first offense, and up to $1,000 for each violation thereafter. Additional disciplinary action against a licensee is possible if the conduct also violates Section 23 of the Illinois Dental Practice Act. Although there may be questions of whether IDFPR has the authority to pursue fines directly against the employees and agents of a dentist for violations of this law, any enforcement action could solely be directed at the dentist(s) at the Dental Office.

Conclusion

Upon taking effect in January, these new provisions will have immediate effects on dental practice operations in Illinois. Dental Offices should consult sophisticated counsel and their commercial finance partners about any needed changes to their third-party financing offerings and for any future rulemaking efforts by the IDFPR to help ensure that access to dental care is not affected. Notably, various organizations participated in the initial discourse about the law, which focused on access to care, administrative burdens on dental offices, potential conflicts of interest and transparency. If similar laws start to proliferate in other states, there could be a significant impact on how the dental industry operates and on patient access to third-party financing, which is often needed for dental care.

For additional information, please contact the authors or another member of Holland & Knight's Dental Support Organizations Team.

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