Weekly Health Insurance Industry Highlights
Catch up on healthcare news and gain insights from our own industry gurus.
The need for consumer decision support tools that deliver clear, reliable information becomes increasingly important as networks come under fire for restricting access; even as the Congressional Budget Office cites narrow networks as a factor in insurers’ ability to offer health insurance exchange plans with lower premiums. Ensuring consumers understand how they can access care will be important to insurers’ ability to successfully offer narrow network products.
CaliforniaChoice private small group health insurance exchange offers an easy-to-use online provider directory
CaliforniaChoice announced [April 14] the availability of an easy-to-use online provider directory to help consumers enrolled in the private health insurance exchange find and select a primary care physician or specialist who meets their needs.
“The marketplace has made it clear that a reliable provider search tool is critical to establishing trust with and giving consumer’s confidence in their selection,” said Ron Goldstein, president and CEO of CHOICE Administrators, which operates CaliforniaChoice. “Our new online tool makes it easy for a consumer to find the doctor who best fits their needs.”
Updated estimates of the effects of the insurance coverage provision of the Affordable Care Act, April 2014
Congressional Budget Office
The Congressional Budget Office (CBO) and the staff of the Joint Committee on Taxation (JCT) have updated their estimates of the budgetary effects of the provisions of the Affordable Care Act (ACA) that relate to health insurance coverage. The new estimates, which are included in CBO’s latest baseline projections, reflect CBO’s most recent economic forecast, account for administrative actions taken and regulations issued through March 2014, and incorporate new data and various modeling updates.
Relative to their previous projections, CBO and JCT now estimate that the ACA’s coverage provisions will result in lower net costs to the federal government: The agencies now project a net cost of $36 billion for 2014, $5 billion less than the previous projection for the year; and $1,383 billion for the 2015–2024 period, $104 billion less than the previous projection.
Effects of the Characteristics of Exchange Plans. The plans being offered through exchanges in 2014 appear to have, in general, lower payment rates for providers, narrower networks of providers, and tighter management of their subscribers’ use of health care than employment-based plans do. Those features allow insurers that offer plans through the exchanges to charge lower premiums (although they also make plans somewhat less attractive to potential enrollees). As projected enrollment in exchange plans grows from an average of 6 million in 2014 to 24 million in 2016, CBO and JCT anticipate that many plans will not be able to sustain provider payment rates that are as low or networks that are as narrow as they appear to be in 2014. CBO and JCT expect that exchange plans will still have lower provider payment rates, more limited provider networks, and stricter management of care, on average, than employment-based plans but that the differences between employment-based plans and exchanges plans will narrow as exchange enrollment increases.
Puget Sounds Business Journal
Washington State Office of the Insurance Commissioner
Rule 2013-22 will require qualified health plans and health plans offered outside of Washington Healthplanfinder to have adequate networks of medical providers of sufficient number and type to ensure that Washington enrollees can access covered services without unreasonable delay. Health care providers must meet new requirements under the federal Affordable Care Act and health insurers must ensure they have adequate networks to meet those requirements.
Seattle Children’s Hospital is asking the federal government to intervene and stop the introduction of Insurance Commissioner Mike Kreidler’s new rules for health insurance plans in Washington state.
Hospital officials have written to the federal Office of Personnel Management (OPM) in hopes the agency will call on Kreidler to delay finalizing the new rules. The OPM was still looking into the issue and had no immediate comment Tuesday.
The hospital’s objections are related to narrow networks in health plans in the state exchange: Insurance companies are building lower-cost networks that don’t include doctors and hospitals that insurers consider too expensive. And one of those excluded is Seattle Children’s Hospital, which sued the Office of the Insurance Commissioner after the office certified many exchange plans that excluded it.
The OPM is an agency that manages civil service for the federal government, but under a provision of the Affordable Care Act (ACA) it is ultimately responsible for the certification of nationwide health plans in state exchanges. Although the OPM has delegated that responsibility to state insurance agencies (including Washington’s), Children’s is making a last-ditch effort to get the federal agency to intervene.
Kreidler has come under scrutiny from all sides for his proposed rules, which create a more clear definition of what makes a health plan’s network “adequate,” with the goal of making sure people have access to health care.
All health plans have provider networks — the collections of doctors and hospitals that are considered “in-network” in a patient’s plan. The Affordable Care Act created a new requirement that health plans must include 10 essential benefits to be considered adequate. Kreidler also created additional parameters for networks in Washington state.
Hospitals, doctors and some consumers argue Kreidler hasn’t gone far enough to make sure those networks are adequate and include enough hospitals and doctors. However, the insurance industry says the new rules go too far, creating extensive new administrative and cost burdens that will make it harder for insurers to offer affordable plans.
Kreidler can’t seem to make anyone happy, but he has the ultimate authority to approve the final rules. He needs to do it soon, because insurers must provide their network plans for 2015 by May 1.
Horizon Blue Cross Blue Shield of New Jersey, the state’s largest health insurer, is in the process of making a transformative move in how it supports the delivery of health care.
In the next two to three years, Horizon hopes to have most of its members in Accountable Care Organizations (ACOs) or Patient-Centered Medical Homes (PCMHs), said Joe O’Hara, the director of clinical innovation at Horizon.
This represents a dramatic increase from today, when just 500,000 of Horizon’s nearly 3 million non-Medicaid members (or roughly 17 percent) are enrolled in these types of plans.