Before the Joint Committee on Health Care
Financing
October 3, 2011
The Massachusetts Medical Society wishes to be recorded in
support of the above-referenced measure, legislation which would
help to "level the playing field" between health insurers and
health care providers.
The intent of this legislation is to protect the quality of
patient care and the financial viability of physician
practices. The bill encompasses several insurance contracting
provisions to ensure fair and equitable contracting between
physicians and managed care companies, based upon actuarial sound
data and the open exchange of information in a timely
manner.
Specifically, this bill would
- Mandate insurance companies to set annual physician group
budgets based on an accepted per member per month cost determined
by actuarial input from a collaboration of representatives from the
MMS, business groups/employers, the Division of Insurance, and
insurance companies.
- Allow physician group's access to the information that health
insurers' use to determine if a group is over or under budget,
receives their year-end surplus, and the amount of
retention/withhold that the group will have in the following
year.
- Require that reinsurance amounts are to be determined according
to an actuarial standard estimate of catastrophic events in a
Provider Unit.
- Require insurance companies to extract claims that may involve
other carriers or future settlements, such as auto accidents
involving legal cases, from year-end budget and settlement
information.
- Add safeguards to limit financial risk arrangements that might
impinge on the quality of patient care and the financial viability
of physician practices.
- Prevent health insurers from forcing physicians to sign up for
several insurance products when the physician signs a contract to
participate in any single plan.
- Require that any amendment of modification to a contract
between a health insurer and a provider must be agreed to by both
parties.
- Expand upon current "timely payment" requirements for health
insurers by including the Division of Medical Assistance and by
requiring insurers to acknowledge receipt of a provider's claim for
payment within 15 days, and if defective, to notify the provider as
to the nature of the defect and what additional information is
necessary to complete the claim.
- Implement statutory controls over the secondary discount market
and "rental network PPO's, which exist to market a physician's
contractually discounted rates to third-party payers.
- Require public and private insurance companies doing business
in Mass to reimburse reasonable physician office practice expenses
related to physician processing of prior authorizations for
medications and procedures which require a medical decision/review
by a physician or other licensed health professionals under his/her
supervision and /or liability coverage.
- Prohibit representatives of health insurance companies from
initiating communication with patients and their families regarding
treatment options and code statuses without a physician's knowledge
or presence.
- Allow physician practices to access reports of initial claims
for services from the health insurance plan in a timely
fashion.
Unfair contracting standards by managed care plans has a
negative impact on patients, as well as physicians. Although
Chapter 141 of the Acts of 2000 went a long way towards increasing
protection of patients enrolled in managed care plans, it does not
prohibit the plans from unexpectedly changing the terms and
conditions of a physicians contract. For example, plans may
currently change gatekeeping restrictions, preauthorization and
other utilization review requirements, referral restrictions, drug
formulary restrictions, and covered benefits - without
warning. All of which would have a direct impact on patients
as well as physicians.
The MMS respectfully urges the Committee on Health Care
Financing to report S.502 out of committee favorably.
