Anna Wilde Mathews and Christopher Weaver
Insurers are facing pressure from regulators and lawmakers about plans that
offer limited choices of doctors and hospitals, a tactic the industry said is
vital to keep down coverage prices in the new health law's marketplaces.
This week, federal regulators proposed a tougher review process for the
doctors and hospitals in plans to be sold next year through HealthCare.gov, a
shift that could force insurers to expand those networks.
Meantime, regulators in states including Washington and New Hampshire are
ramping up their own scrutiny, and lawmakers in Mississippi and Pennsylvania,
among others, are weighing bills that could force plans to add more hospitals
and doctors.
The moves come amid complaints by some consumers that they don't have access
to a broad enough range of care—such as specialists at top academic medical
centers, which tend to charge insurers higher fees and aren't included in many
of the new networks.
Some consumers say they will have to switch doctors with the new health-law
plans. But the issue extends beyond the new policies, as insurers have been
trimming the array of doctors in private Medicare Advantage coverage and losing
some big health-network providers due to market clashes.
California Insurance Commissioner Dave Jones said he plans to revise his
agency's standards for insurers' health networks partly because current
regulations don't give him enough power to continue oversight after a health
plan goes on the market. The aim would be to "make sure when people purchase
health insurance, they have reasonable access to health-care providers," he
said.
Under the new federal proposal, insurers selling plans in the federally run
marketplace would be required to submit to the Centers for Medicare and Medicaid
Services a full list of providers in a network before their plans are approved
for listing in the exchanges. In the future, regulators also plan to develop
federal standards for the required number of providers. For this year, the
federal exchange relied largely on state regulators and third-party
organizations to review networks, said Karen Pollitz, a senior fellow at the
Kaiser Family Foundation.
"It's a substantial change," said Ms. Pollitz. "It's much more specific, and
it's going to involve a lot more direct federal oversight."
Under the proposal, the plans offered in the federally run insurance
marketplace also would need to include a larger share than previously required
of "essential community providers," which are safety-net hospitals, clinics and
others often used by lower-income people.
A spokesman for the Centers for Medicare and Medicaid Services said it is
"working to strengthen the network adequacy requirements that took effect for
this year."
The American Medical Association said it would monitor any patient-access
problems in the exchanges and work "to implement proactive solutions we believe
can enhance the public health and welfare by eliminating inadequate networks,"
which, it said, could "endanger patients' health if they cannot access timely,
convenient, quality care."
A spokesman for America's Health Insurance Plans, the industry's main trade
group, said narrower provider networks are "one way health plans can help to
preserve benefits and mitigate cost increases for consumers" as health-law
changes take effect.
Narrower networks can help keep down costs partly because providers agree to
lower their fee in exchange for the volume of business they expect with fewer
competitors.
Some 70% of new plans under the health law offer relatively narrow networks
compared with many current plans, according to a recent report by McKinsey &
Co. The consulting firm found that plans with smaller choices of hospitals had
significantly lower premiums than similar plans offering a broader choice.
The narrow networks have drawn protests, lobbying and some legal challenges
from doctors and hospitals.
In New Hampshire, WellPoint Inc. is the only insurer offering consumer plans
on the exchange, and its network leaves out 10 of the state's 26 hospitals. The
Legislature is considering a bill that would force health plans to negotiate
with all providers, and the state's insurance regulator is planning to review
its network standards, with a hearing set for Monday. Frisbie Memorial Hospital
in Rochester, N.H., has filed a legal protest about the network, which doesn't
include it, and is offering patients transportation to the hearing.
The state regulator has already heard from some, like Josh Kattef, 37 years
old, an investor in Hopkinton, N.H. Mr. Kattef said that with any of the new
plans he would have to drive about 40 minutes to the nearest hospital, and they
don't include his current physicians.
"No one wants to give up their doctor," he said. Mr. Kattef said he currently
is on an old plan with a broader network, but he will have to switch in December
to a new health-law plan.
A WellPoint spokesman said its health-law plan network "meets and exceeds"
New Hampshire standards, and that the plans would cost about 30% more if they
didn't have a limited network. "All exchange members would have seen higher
premiums," he said.
In Washington state, Seattle Children's Hospital has filed a legal protest
against the insurance department's decision to approve networks that didn't
include it. The state regulator, which clashed with several insurers over their
networks last year, has proposed new standards for reviews that would toughen
scrutiny about provider networks and require more disclosure of changes to
consumers.
Meantime, legislation proposed in Mississippi would prohibit insurers from
turning away most hospitals, doctors or other health providers that agree to
prices set by insurers. The bill also would bar insurers from selectively
charging higher copayments at some doctors' offices or hospitals as a means of
steering patients to lower-fee options.
In Pennsylvania, state Rep. Jim Christiana, a Republican from suburban
Pittsburgh, proposed legislation that would block insurers from excluding
hospitals in some circumstances after a dispute between two big insurers with
affiliated health systems. "We don't believe access should be restricted to lock
out competition," he said.
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