Originally published April 28, 2014 at
11:42 AM | Page modified April 28, 2014 at 8:01 PM
The Seattle Times
Insurance chief OKs eno surprisesf rule for health-plan networks
State Insurance Commissioner Mike Kreidler took heat from
both insurers and hospitals, but hefs adopting new rules on network adequacy
anyway, saying he needs to protect consumers.
By Carol
M. Ostrom
Seattle Times health reporter
Despite criticism from both insurers and hospitals, Insurance Commissioner
Mike Kreidler adopted a new
rule Monday that spells out what health insurers must do to make sure their
networks of hospitals and doctors can provide covered benefits to patients.
gIn the end, itfs my responsibility to make sure we protect consumers, and I
have the tools to do it,h Kreidler said in an interview Friday. gIf consumers
start getting hurt, therefs nobody who is going to take the fall but me.h
Kreidlerfs office published the rule Monday, and it will take effect May 26.
The rule will apply to individual or small-group health plans in 2015 —
essentially all state-regulated health plans offered inside or outside
Washington Healthplanfinder, the statefs online insurance exchange.
For patients, the general
thrust of the rule, which affects plans offered for coverage in 2015, is gno
surprises.h It requires insurers to spell out how their benefit arrangements
affect patientsf pocketbooks, clearly explain referral and authorization
practices, tell policyholders whether emergency-room doctors in an in-network
hospitalfs emergency room are also in-network, and update directories of
in-network providers monthly.
Many patients were surprised that some insurersf networks for 2014 plans did
not include some major medical centers. Insurers said their gvalue networksh
helped hold down the price of premiums.
The rule sets specific standards for network adequacy. For example, it
requires that the ratio of primary-care providers across a given service area
must at least meet the average ratio for the state, and that 80 percent of
enrollees are within 30 miles of an adequate number of primary-care providers in
urban areas, and within 60 miles in rural areas.
Kreidler said he expects the rule will also help doctors. gThe rule will make
it easier for a provider who is going to refer a child to a pediatric-hospital
setting to be able to know whatfs in network for that policyholder,h he said.
gItfs not easy to find out that information now.h
The rule limits so-called gspot contracting,h which some insurers have
offered if a patient needs a particular service not provided elsewhere in their
network. The rule says that such single-case contracts gmust not be used to fill
holes or gaps in the network.h
Another provision in the rule requires plans to include gessential community
providers,h those who serve predominantly low-income, medically underserved
individuals.
People need to know that the plan they pick doesnft just look good on paper
but will provide covered benefits, Kreidler said: gYou need to know as a
consumer, eIf I pick this plan, itfs not a false plan — it is actually one where
I have reasonable expectation of being able to find a provider, and that
provider will have open appointments.f h
Insurers and hospitals offered testimony at a public hearing on the rule last
week, with insurers saying the rule is overly complicated and burdensome, and
hospitals saying they werenft strict enough when it came to making sure
hospitals would be included in networks.
The version that was adopted, Seattle Childrenfs wrote to Kreidler earlier
this month, gremains fundamentally flawed and if adopted will cause significant
consumer and health care delivery system harm.h
In an email, Childrenfs spokeswoman Stacey Dinuzzo said: gWefve had a really
hard time getting a few of the insurers to even come to the table to negotiate.
They simply informed us that they would not include us in their exchange-plan
network.h
Hospitals said the rule does not allow Kreidlerfs office to see the actual
terms offered by an insurer, but only requires gsubstantial evidenceh of ggood
faithh efforts. They said under that standard, even an insurerfs very lowball
offer to a hospital would be considered ggood faith.h
gWefre trying to find a balance here between negotiating parties,h Kreidler
responded. His officefs authority to get into specific dollar amounts in
contracts is limited, he said.
Kreidler said he was sympathetic to some of those who have criticized the
rule, particularly those who said the time frame was too tight to fully comply,
with plans for 2015 due on May 1.
He said his office began work on the rule last fall and has worked with
hospitals, insurers and others to take comments into consideration in the final
version of the rule.
gI wish we had more time to work with all the interested parties,h he said.
gUnfortunately, we donft have that kind of time if we want to move into the 2015
filings.h
The rule has built-in flexibility, he said, such as allowing insurers more
time for some paperwork requirements and to get their networks nailed down.
What is happening now, Kreidler said, is the beginning of a fundamental
gtrue-up of health-care expenses.h Medicaid has long underpaid hospitals and
doctors, he said, and in the past, providers simply shifted those costs to the
private market.
gThat has changed now,h he said. gItfs forced the carriers, rather than just
trying to avoid sick people, to really start to compete. If they can sharpen a
pencil, theyfre going to do it. My job is to make sure they donft sharpen it too
much.h
The rule goes into effect in 31 days.
Carol M. Ostrom: costrom@seattletimes.com or 206-464-2249 On Twitter
@costrom