By Robert A. Holden, Esq., Senior Vice President
The transparency and sufficiency of the provider networks available to health care consumers is at the heart of the current debate over “Narrow Networks.” In an effort to maintain affordable premiums, some plans have pared back the networks of physicians, specialists, and other health care providers they allow their enrollees to access. This can cut costs by streamlining network management costs as well as steering enrollees away from higher cost providers. So long as this information is available to consumers and the resulting network provides the consumer with adequate access to care, the strategy can provide an option to consumers looking to control costs.
Because the success of the narrow network concept depends on making the available network providers transparent to consumers, states have been reviewing their traditional roles of regulating health care insurance network adequacy. At the national level state insurance regulators at the National Association of Insurance Commissioners (NAIC) spent much of 2014 revising its model act addressing network adequacy, a process that may be complete in March of 2015 and may require additional model regulation. To date, the chief issues of discussion have been the measurement and enforcement of metrics to determine the appropriate primary care and specialist providers, as well as how this information will be made available to regulators and, ultimately consumers. This presents challenges to both health care plans and providers alike as they will be required not only to determine who is in or out of network, but also whether providers are accepting new patients.
In individual states, network adequacy was a significant issue in 2014, and looks to be even more so in 2015. Legislatively, Kentucky, Massachusetts, New Hampshire and New Jersey addressed network adequacy related legislation during their respective 2014 sessions, with California and Illinois enacting legislation. California’s S.B. 964 requires health care plans, as part of the annual reports, to submit data regarding network adequacy to the Department of Managed Health Care (DMHC). Illinois S.B. 741, a comprehensive Medicaid bill, requires the Illinois Department of Healthcare and Family Services to ensure that an adequate provider network is in place, release an explanation of its process for analyzing network adequacy, periodically ensure that a managed care organization continues to have an adequate network in place and require managed care organizations to maintain an updated and public list of network providers.
In 2015, the New Jersey Legislature is considering “any willing provider” legislation requiring networks to accept all qualified health care providers, including clinical laboratories, that wish to join the network. Similar bills have been filed in Missouri and Nevada for 2015, and legislation is expected in Pennsylvania. New Jersey and Connecticut are also considering legislation that would provide reimbursement to out of network health care providers at the same rates and under the same terms as in network providers in certain circumstances.
States have also taken administrative steps to address network adequacy issues. In New Hampshire, insurance officials are conducting a review of the state’s network adequacy rules. The Washington Office of the Insurance Commissioner adopted a network adequacy rule. The Oregon Healthcare Network Adequacy Advisory Committee (HNAAC) met during 2014 and the state is expected to act to address the issue in 2015. In addition to state action, insurers have faced consumer lawsuits over the adequacy of the networks being offered. The issue also arose during the 2014 election cycle with critics of the Affordable Care Act highlighting access issues during their campaigns. In 2014 and again in 2015 California has issued emergency rules to address network adequacy.
States have also devoted time to lay the groundwork for legislative or regulatory changes. Mississippi Governor Phil Bryant (R) issued an executive order to establish the Task Force to Study the Impact of Network Adequacy to review and create policy recommendations concerning Mississippi’s health insurance networks, with a focus on narrow networks. Similarly during the 2014 interim, the Texas House Insurance Committee met to discuss interim charges to evaluate options to address transparency, consumer choice, previous regulatory efforts to reduce the impact of out-of-network service disputes. These two states will be joined by others, particularly as policy standards emerge from the NAIC model law and rule process.
With state health care exchanges now in the midst of their second open enrollment period, consumers are finding that their health care insurance premiums have not increased substantially over last year – particularly if they switch plans. As noted in the New York Times, the administration is encouraging consumers to shop for different plans on the Federal and State-based exchanges, taking advantage of the capabilities of the electronic marketplaces to compare similar plans and select the lowest cost. A difficulty arises when consumers try to confirm access to a specific physician or specialty health provider. While pricing information is available on the exchanges, there is mounting concern that the information related to provider directories and the size and scope of provider networks may not be as readily available. These will be major issues as states attempt to address both the access and information issues this session.