ANY WILLING PROVIDER: PAST APPLIES TO FUTURE LEGISLATION
"No issue affecting HMOs, PPOs, and similar health careThis is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.
plans has generated more debate over the past decade than any
willing provider [AWP]," according to HEALTHPLAN, the bimonthly
magazine of the American Association of Health Plans (AAHP).
While other managed care regulatory legislation such as minimum
maternity stays, specialist access and Patient Protection Acts
are increasing in popularity, adoption of AWP laws has "slowed to
a snail's pace." HEALTHPLAN reports, however, that for many, AWP
laws are "the quintessential example of anti-health plan
legislation," and the debate over their enactment "may yield
lessons that are relevant to other important health plan
legislative issues."
AWP STILL THE FLAGSHIP: Because limiting the number and
scope of providers that participate in a health plan's network
"are cornerstones of health plan operations, AWP laws can strike
a severe blow to the ability to operate efficient, quality-based
health care plans," HEALTHPLAN reports. HMOs, PPOs and other
managed care groups identify several problems stemming from AWP
laws, including: the need for managed care plans "to operate
more like fee-for-service insurers;" lower quality standards
because plans can't select only the "best trained and most highly
qualified" providers; limitations on consumers' ability to choose
closed-panel networks; and health plans' ability to negotiate
volume discounts. HEALTHPLAN notes that "[m]any groups" have
agreed with this assessment, including the Federal Trade
Commission which has "warned of the anti-competitive effects of
AWP legislation in at least nine states." The National
Association of Insurance Commissioners and the National
Governors' Association have also "issued statements opposing AWP
laws, emphasizing the potential harm to consumers." According to
a 1994 study by Atkinson & Company, the increased administrative
and health care costs resulting from AWPs "would force HMOs to
increase premiums between 9.1% and 28.7%."
WHO HAS AWP LAWS: AWP statutes have been enacted "primarily
in states with lower than average presence of HMOs, PPOs and
similar health care plans," according to HEALTHPLAN. In the
states with AWP laws, 14.6% of the population was enrolled in an
HMO, while HMOs cover 24.3% of the population in the states that
lack AWP laws. Additionally, of the more than 51 million HMO
enrollees in the nation, about 12 million (25%) are in states
with limited AWP laws, and just over 500,000 (1%) are in states
with comprehensive AWP laws. The vast majority of people in
HMOs, 38 million (74%), live in states without AWP requirements.
HEALTHPLAN notes that "states that have considerable experience
with network-based health care plans are historically less likely
to enact AWP requirements." California Association of HMOs
Legislative Affairs Director Maureen O'Haren said, "Health plans'
success in serving members and purchasers leads in turn to much-
needed political support from business and consumers."
HISTORY & PRIORITY: 1994 "marked the zenith" in AWP
legislative activity, according to HEALTHPLAN. That year, nine
states enacted AWP laws, including three that apply to
physicians. Since then, however, only two AWP laws were enacted
in 1995 and only one, in Kentucky, in 1996. While 24 states have
enacted AWP laws in the last 20 years, only four states --
Arkansas, Idaho, Kentucky and Wyoming -- have AWP laws that apply
to physicians. Despite this, AWP legislation "continues to be a
priority for the health plan industry," said Lee Wood, a vice
president at Prudential Insurance Company of America. "In
addition, we are facing increasingly sophisticated anti-managed
care measures that evolved from the AWP debate. The AWP
experience has taught us lessons and strategies that we can apply
to these emerging issues."
TRANSITIONS: HEALTHPLAN reports that the "[r]ecent trends
seem to indicate" that AWP "may no longer be the central issue in
state legislative debates concerning network-based health care
plans." Again citing Kentucky as the sole enactor of AWP
legislation in 1996, HEALTHPLAN notes that "this year, state
Legislatures have been active in areas such as maternity length-
of-stay, direct access to specialists, and so-called 'gag'
rules." However, HEALTHPLAN concludes, "because AWP proposals
continue to be introduced frequently in state Legislatures and
litigated in courts, AWP is certain to occupy some of the
industry's attention for years to come" (D'Andrea,
September/October 1996 issue).