TOO NARROW NETWORKS?

Many insurers have been rolling out “narrow networks”.  We have previously reported on concerns that the networks were too narrow and cause significant displacements among policyholders seeking not only to maintain relationships with doctors, but also seeking any type of out of the ordinary services, treatment or prescriptions.  HHS released new regulations on March 14th.  While these regulations are still being analyzed in detail, it appears that these new regulations will require the following:

1.     Insurers must have contracts with at least 30% of “essential community providers” in the service area.  Not only will this require a review of narrow networks that have excluded more specialized providers of heart, oncology and similar services, it will also require the network to include community health centers, HIV/Aids clinics, family plan clinics, children’s hospitals and hemophilia treatment centers.

2.     Insurers must provide direct links to information about what physicians actually are in the list of approved providers, and what covered drugs are included and co-pays.

There has been significant criticism that narrow network descriptions were not accurate when listing available providers or covered drugs, or that this information simply was unavailable.

3.     Lists of providers must note which ones are actually accepting new patients.  Again, this has caused significant problems as some of the networks’ listed primary care physicians, none of which were accepting new patients.  Obviously, enrolling new patients in narrow network plans where none of the primary care physicians would accept new patients created immediate problems for enrollees.

4.     Narrow network plans will be reviewed at the federal level to prevent discrimination against people with “significant health needs”.  HHS will apparently analyze barriers and copayments charged for prescription drugs, hospital stays, specialist visits and other issues, including the overuse of pre-authorization requirements for certain procedures or drugs.

5.     The rules do not appear to provide a remedy for any excluded provider.  While an excluded provider can certainly provide information to HHS to assist HHS in determining whether the policy is, under the ACA, adequate, it does not appear that either state or federal insurance regulators intend to order the inclusion of any particular provider.  The most likely remedy for a too narrow network claim would simply be a requirement that the provider add adequate providers, not any individual provider.

ACA ALTERNATIVES

This week, reports indicated that the House GOP majority is crafting its healthcare reform provisions to replace ACA.  The plan contains the usual attempt to impose limitations on medical malpractice claims, and also seeks to allow health insurance to be sold across state lines.  The idea of national health insurance as opposed to state regulated health insurance has been debated for years.  The proponents believe that allowing for uniformity in health insurance policies will provide greater availability and lower costs.

Opponents point to the result of consumer credit nationalization which resulted in nearly all credit card issuers moving to low regulation states, such as South Dakota, and resulted in credit card interest rates as high as 79%.  It is likely that the proponents of this bill will have an intra party debate on the issue of whether national health insurance is a positive or results in the lowest common denominator and consumer damage before it can even be placed on the table for public debate.

GRACE PERIOD RISKS

If an enrollee in a subsidized ACA plan falls behind on premiums, ACA requires insurers to cover their medical bills for 30 additional days.  For the next 60 days, insurers may “pend” the claims (defer payment), and ultimately refuse to pay them if the patient doesn’t catch up on his/her premiums.  The result is that a doctor who checked the insurance status of a patient on a first visit may face substantial unpaid bill risks if the patient is in the “pended” category for subsequent visits.

Since it is normally a violation of a contract between the payor and the insurer to insist on upfront payments, this puts physicians, particularly those with substantial continuing care treatments, such as obstetricians and oncologists, in a very difficult position.  Also note the AMA’s guide to the grace period specifically cautions physicians that postponing or rescheduling patients can be a breach of contract because of anti-discrimination clauses.  In some cases, insurers will pay physicians for the entire 90 day period, but then will seek to recoup or offset if patient policies that are pended are ultimately terminated.

We suggest that physicians, in their documents with ACA patients, include a provision stating that no treatment will be offered during “pend” periods, and that if any claims are later lost or recouped by insurers due to failure to pay premiums, that the patient will be 100% responsible for all charges.  Additionally, providers should recheck the insurance status of patients for every visit, and not assume that policies continue in force.

This newsletter is edited by Paul Wallace of Jones • Wallace, LLC, a member of the American Bar Association Healthcare Law Section and the American Health Lawyers Association who has been representing physicians and healthcare practices for over 25 years.  Mr. Wallace assists physicians in health practices in contract items, federal legal compliance, creation of practice entities, estate and wealth planning and similar issues.  Please feel free to call if you have any questions on this newsletter or legal matters at (812) 402-1600 or pwallace@joneswallace.com.