Obamacare Insurers May Be Forced to Add Medical Providers
By Alex Wayne - Feb 4,
2014 - Bloomberg
Insurers participating in Obamacare may have to expand their plans to include
more federally funded health clinics, safety-net hospitals and other medical
providers used by low-income people, under a U.S. proposal.
Health plans offered through government-run insurance exchanges may be
required to cover 30 percent of gessential community providersh in their areas
in 2015, an increase from 20 percent this year, according to a letter to insurers issued today from the
Health and Human Services Department. Insurersfprovider networks will also be
reviewed to ensure they providegreasonable accessh to health care.
As millions of Americans join health plans created through the 2010 Patient
Protection and Affordable Care Act, consumers and regulators are paying greater
attention to the breadth of available coverage. Insurers say smaller networks of
hospitals and doctors help contain costs and improve care. Providers serving
low-income people have complained that exchange plans wonft allow them to join
the networks, said Sara Rosenbaum, a professor of health policy at George
Washington University.
gEverybody is obviously very concerned that whatfs going to happen is their
patients will be swept away -- they will not be identified as preferred
providers in networks,h Rosenbaum said in a phone interview. gClearly something
has set off alarm bells.h
About 3 million people signed up as of Jan. 24 for private health insurance
plans offered by the new marketplaces, HHS has said. WellPoint Inc., the
second-biggest U.S. insurer, said it had added 500,000 members through the
exchanges set up by the law known as Obamacare.
Limiting Providers
More than two-thirds of health plans on exchanges have assembled provider
networks considered gnarrowh or gultra-narrow,h in which as many as 70 percent
of hospitals and other local health providers arenft included, according to a
December study by the consulting firm McKinsey &
Co.
Narrow networks enable insurers to negotiate lower prices with hospitals and
doctors, which can be passed on to consumers in the form of lower monthly
premiums. The insurance
industry argues the practice also enables them to more closely manage the
care of patients, benefiting their health.
Exchange plans with broad networks of hospitals carry premiums 26 percent
higher, on average, than similar plans from the same carriers with narrow
networks, according to the McKinsey study.
Pushing Changes
gIt is important to ensure patients can continue to benefit from the
high-value provider networks health plans have established, which are helping to
improve quality and mitigate cost increases for consumers as the new health care
reforms are taking effect,h Robert Zirkelbach, a spokesman for Americafs Health
Insurance Plans, the industryfs Washington-based lobbying group, said in an
e-mail.
Federally funded health clinics, public hospitals and other providers that
serve low-income people have been lobbying the government for two years to
require insurers to more broadly cover their services, Dan Hawkins, vice
president for federal, state and public affairs at the National Association
for Community Health Centers, said in a phone interview.
gHHS has done a miserable job of establishing a decent network adequacy
standard to ensure that insurers are not red-lining low-income communities and
communities of color and other vulnerable populations,h he said. gFor them to
say wefre going to change our rules from 20 percent to 30 percent, thatfs
whistling past the graveyard. Thatfs nowhere near adequate.h
Aaron Albright, a spokesman for the Centers for Medicare and Medicaid
Services, which oversees the exchanges, said he couldnft comment on a draft
proposal.
eStrengthenf Networks
gBut, in general, CMS is working to strengthen the network adequacy
requirements that took effect for this year for the first time under the
Affordable Care Act,h Albright said in an e-mail. gThese are important
provisions and include requirements that insurers have adequate provider
networks for consumers, including access to essential community providers that
serve low-income, medically underserved individuals.h
Albrightfs agency said in the letter that if it determines a health planfs
provider network is inadequate it may exclude it from the exchanges. The agency
said it would particularly focus on insurersf coverage of hospitals, mental
health clinics, cancer centers and primary care physicians.
Ideally, the government would require insurers to contract with every
essential provider in their service areas, Hawkins said. In addition to
community health centers and public safety-net hospitals, essential providers
include AIDS clinics, family planning clinics, childrenfs hospitals and other
facilities qualifying for a federal program that provides deep discounts on drug
prices, Rosenbaum said.
To contact the reporter on this story: Alex Wayne in Washington at awayne3@bloomberg.net
To contact the editor responsible for this story: Reg Gale at rgale5@bloomberg.net