Exchange Plans Could Face New Standards for Provider Networks
The Obama administration is developing new standards to address consumer concerns about narrow hospital and physician networks for plans sold through the Affordable Care Act's insurance exchanges, the New York Times reports (Pear, New York Times, 7/19).
About 50% of health plans available through the Affordable Care Act's exchanges this year have narrow provider networks, according to a report last month from the McKinsey Center for U.S. Health System Reform (California Healthline, 6/11).
Insurers in several states have announced plans to expand their hospital and physician networks for plans sold through the ACA's insurance exchanges, amid complaints from consumers and state officials about limited provider options. However, insurers have said that the network expansions are not in response to complaints from consumers and state officials, but instead reflect a growing willingness among providers to join the networks, which often pay less than employer-sponsored plans (California Healthline, 6/10).
Details of New Standards
Federal officials said the new provider network standards will be similar to those used in Medicare Advantage.
Under MA's network adequacy standards, insurers must include a minimum number of primary care physicians and specialists in each plan, which varies based on the county population, population density and other factors. The standards also set maximum travel and distance criteria for MA plans. For example, plans for MA beneficiaries in large metropolitan areas are supposed to include primary doctors within five miles and 10 minutes of where they live.
Officials are using the same computer software to evaluate plans offered through the ACA's exchanges that they have used to evaluate MA plans, according to the Times. The software measures the distance between individual policyholders and individual providers in a given geographic area.
In the new standards for plans sold through the ACA's exchanges, most insurers will be required to offer plans with at least 30% of "essential community providers" that treat "low-income, medically underserved individuals" in their coverage area, the Times reports. Such essential community providers include HIV/AIDS clinics, community health centers and family planning clinics.
Specifically, the Obama administration said in a recent memo to insurers that the standards would focus on "those areas which have historically raised network adequacy concerns, including hospital systems, mental health providers, oncology providers and primary care providers."
States Setting Own Standards
Under the new standards, states are also able to adopt additional standards, as several already have done, according to the Times.
For example, Washington state set its own network adequacy standards in April, while New York recently passed a law that allows patients to receive treatment from out-of-network providers at in-network costs if their health insurance does not include any providers with expertise to treat their condition.
Insurers Weigh In
Many insurers have said that consumers should be able to choose between less-costly plans with more narrow networks and more-costly plans with broader networks. Further, insurers have argued that ability to offer plans with narrower networks helped keep premiums lower and allowed them to exclude lower-quality providers from plans, according to the Times (New York Times, 7/19).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.