Comments Of The Massachusetts Medical Society Regarding Certification Of Risk Bearing Provider Groups

Before the Massachusetts Division of Insurance, Sept. 28, 2012

The Massachusetts Medical Society appreciates the efforts of the Division of Insurance to reach out to providers regarding the certification process for risk bearing groups. The MMS has reviewed the public submissions on this issue from three large and well regarded provider groups: Atrius Health; MACIPA and Mount Auburn Hospital. The MMS finds that the points raised in these submissions are significant and well expressed. We strongly agree with their concerns on audits, confidentiality of information and timeliness of certification and waivers and fully support those points specifically. The MMS is concerned additionally that if these major organizations foresee almost insurmountable issues with some of the proposed requirements, then smaller groups and individual practitioners will not have the resources to even begin the process for certification or a waiver.

Making a significant number of physicians ineligible to participate in contracts other than strict fee for service is contrary to the legislative intent of Chapter 224 and will present serious access problems for the population in general and individuals in state programs (MassHealth, GIC and Connector) in particular. Although state payers are not addressed in the regulations, it appears that some Managed Care Organizations and Integrated Care Organizations will be required to register, or to contract only with providers who take risk. These programs are all looking towards significant participation in alternative or global contracts in the near future. If provider groups are not certified, they may not enter into such contracts and patients will have huge access problems. We recognize that the legislature created this contracting prohibition but we urge the Division to proceed cautiously and to implement the statutory language in a way that fully utilizes the discretion granted the Division in promulgating regulations, particularly in the area of waivers.

Clearly, the Division should take an approach which maximizes waivers for provider groups in its definition of what is significant risk requiring registration. Waivers will be appropriate for groups of all sizes and for subcontracting within large systems. It is important that the waiver process must be simple and be an alternative track to certification, not an exemption after full materials for certification have been provided. The Division should assess the significance of the risk to the public as a whole rather than the significance of financial loss to an individual provider. Only potential catastrophic losses which would lead to the unavailability of care already purchased should be considered significant risks.

Complex actuarial projections on future contracts are neither possible nor feasible for small physician groups. They can also be a wasteful expenditure for large groups. While all size groups do make assessments of the patients they take on for risk, few engage in the actuarial behaviors of insurers. It is prohibitively expensive and time consuming for groups to purchase this service and would significantly increase the risk of financial loss for the practice by exponentially increasing practice costs for services which provide no benefit to patients. Additionally, as a specialty service, actuarial risk auditors may not be available in sufficient numbers to meet the potential demand strict regulations might create. Significant non-clinical expenditures for health care providers were clearly not an intention of the legislature when they were seeking to lower health care costs.

The MMS urges that small groups and individual physicians be exempted from registration requirements unless they take on contracts which make them financially responsible for the entire medical care requirements of a patient and they have no stop loss insurance. Again, significant risk should be measured in the ability to provide care, rather than in the potential for significant but bearable losses for a group. Large groups with experience taking on risk deserve consideration of deemed status or automatic waivers as well.

In the area of examinations by the Division, it should be clarified that organizations with a waiver are not subject to examination unless a complaint or issue arises. Similarly, fees for waivers should be minimal and certainly less than $100 for small groups and $25 for individual physicians.

Section 216(6) of Chapter 224 has a blanket ban on providers seeking payment from patients for fees owed by risk bearing providers. This should be clarified to ban only billing by providers with contractual relationships with such risk bearing providers. Providers with no contractual relationships to patients or their previous providers should be under no obligation to provide free care to such patients.

On the timing of waivers, there should be a very quick turnaround for all groups and a deemed status for provider groups such as those with fewer than 15 providers and with downside risk at less than 20% of their annual gross revenues. As this is new territory, the appropriate waiver point may vary significantly and the MMS is not tied to a single approach or threshold. However, we should have some reasonable approach to protecting the public without creating an enormous bureaucratic process. Simple standards and criteria for significant risk will save the Division and providers time and money.

The MMS supports the Division in its efforts to establish the registration of risk bearing groups in an efficient and appropriate manner and looks forward to a full regulatory hearing process with significant public input on this essential issue. The full complexity of the requirements of Chapter 224 is only now beginning to resonate through the provider community. We support the Division in its efforts to fully understand the implications of transference of risk from insurers to medical providers.

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