Small Smiles agrees to $39M settlement in mistreatment lawsuit

The Small Smiles dental chain has agreed to pay $39 million according to the proposed settlement filed in bankruptcy court in Nashville, TN. The lawsuits included claims for alleged "unnecessary, inappropriate, unsafe, and excessive dental procedures" performed on thousands of young children at Small Smiles clinics between 2000 and 2010.

The tentative settlement resolves claims against 71 Small Smiles clinics, the parent companies, and hundreds of Small Smiles dentists, said Houston plaintiff's attorney Jim Moriarty, who is also chairman of the Trustee Advisory Committee for the Small Smiles children's abuse trust. The claims include alleged overtreatment, abusive use of restraint devices, dental malpractice, and other forms of substandard dental care.

James Moriarty, chairman of the Trustee Advisory Committee for the Small Smiles children's abuse trust.

"The tentative settlement raises awareness of the need for all dentists who treat our most vulnerable children to allow parents to accompany their children, to avoid the routine use of physical restraint devices, to not overtreat children for profit, and to place the children's best interests above their own financial interests," Moriarty noted in a statement.

"We must guard against dentists that mislead parents, intentionally overtreat under the guise of 'protecting' children, pull baby teeth that would otherwise soon fall out, intentionally place stainless steel caps on toddlers, and perform unnecessary baby root canals. Some of these abused children will suffer for life."

The tentative settlement would be paid by Small Smiles' insurer, the National Union Fire Insurance Company of Pittsburgh.

The settlement will also eliminate medical malpractice coverage for the 333 dentists included in one of the company's insurance policies, according to Moriarty.

"This settlement will wipe out medical malpractice coverage for 333 dentists who worked for Small Smiles, and if they're sued in the future, their insurance company will not be there to protect them," Moriarty told DrBicuspid.com.

The owner of Small Smiles, CSHM, owns dental clinics in 19 states and the District of Columbia. It is the restructured company that emerged in June 2012 when Church Street Health Management (formerly Forba Holdings) filed for bankruptcy in February 2012. CSHM also filed for bankruptcy in February of this year after the company was excluded from the Medicaid program in 2014 by the U.S. Department of Health and Human Services for encouraging dentists to perform unnecessary treatments to boost profits. CSHM pledged to "mend its ways," according to documents filed in the U.S. District Court for the District of Delaware.

In 2010, Small Smiles paid $24 million to settle allegations of Medicaid fraud brought by the U.S. Department of Justice. A total of $3.45 million of that went to the state of New York, where the company operates several clinics.

More than 90% of the company's $161 million in revenues in 2011 came from Medicaid and New York's Children's Health Insurance Program (CHIP), according to a 2013 investigative report by a U.S. Senate committee.

The May 6 tentative settlement must be approved by the bankruptcy court in Nashville; a hearing is tentatively scheduled for June 2.