For some light reading before I have my coffee this morning, CMS released their draft letter to insurers regarding rules for the 2017 Federally Facilitated Marketplace (FFM or Healthcare.gov). The one area of interest is the network adequacy guidelines. CMS is attempting to align Exchange provider network adequacy with Medicare Advantage. However, the guidelines are still very soft. These guidelines will change very few networks.
Let’s look at them as it starts on page 22
If finalized, these default standards would be similar to the time and distance standards applied today to Medicare Advantage plans, and would focus on the providers and facility types identified in Table 2.1. In general, under this default standard, a QHP issuer in a State would be required to ensure that a certain percentage of the potential enrollees residing in a county have access to a minimum number of providers or facilities of each type within the established time and distance standards, and that they meet specific minimum numbers of providers and facilities within specified geographic parameters
These are very soft standards. For very large metro counties, the minimal standard is one primary care provider in five miles. A single primary care provider could theoretically provide “access” to 74% of Manhattan. That is absurd. A single psych facility properly placed could provide minimal access to almost all of New York City.
Small towns like Hickory, North Carolina or Sault Sainte Marie, Michigan or or Devils Lake, North Dakota could see insurance plans be sold in their counties even if the closest in-network OB/Gyn is an hour away (assuming good weather on the roads) from the population center in the county..
These are bare bones standards. I doubt there are many plans that would have to modify their networks to meet these standards. A standard at this level will discourage the worst of the worse, but it will not provide effective access to many people.
Plan networks are created to match one of two sets of standards. The first is the NCQA minimal provider standards. These standards are usually ratio based where a plan is expected to have one provider in each specialty for every X thousand covered lives in each county. NCQA standards tend to be tighter/harder to meet than either federal or state regulator standards. The other type of standard is the marketing level standard. Marketing can’t sell a plan with minimal access. It might be cheap, but it can’t make money. This is less true in the individual market than the group market due to the subsidy structure of the Exchange, but a complete dogpile of a network will produce a strong public and political backlash that most insurers want to avoid as we are already perceived to be evil bastards.
In 2013, setting up my company’s Exchange networks ate up 2,500 hours of my time. Early in the process, the Big Idea Geniuses wanted to see a minimal network scenario. We made the skinnest network possible that met minimal requirements of the state regulators. It used 11% of the individual providers and 7% of the hospitals in Mayhew Insurance’s broad big group commercial network. It met state requirements at the cost of not meeting NCQA standards in half the counties. The narrowest network that we submitted for the Exchanges was actually three to four times the size of that mock-up. We needed the providers to meet NCQA and marketing standards in all counties.
dr. bloor
“draft letter to insurers regarding rules for the 2017 Federally Facilitated Marketplace (FFM or Healthcare.gov)”
Enjoy your coffee. I recommend an IV drip, or perhaps a capsule similar to the one Tom Cruise had injected into his head in Mission Impossible 3.
Jim
To me, the most important sentence you wrote is “CMS is attempting to align Exchange provider network adequacy with Medicare Advantage.” I hope to see more of this from the gov’t. The more consistency we can get in the healthcare payment system, the better off we are.
JPL
Isn’t today when Matt Bevin is suppose to introduce his plan to screw the people of Kentucky.
dr. bloor
@JPL: He can roll out a bunch of chimps with stethoscopes, and as long as he says its NOT OBAMACAREZ they’ll eat it up.
MomSense
@dr. bloor:
The dirty secret is that the private insurers can’t compete with Medicaid when it comes to providing health care to human beings who have lower incomes. Goes against the orthodoxy of government being evil and no good.
Prescott Cactus
@JPL:
mclaren
As always, Mayhew avoids talking about the real issues with America’s broken medical-industrial complex. The big problem isn’t the adequacy of inadequacy of in-netwoork medical services, but rather the pervasive scam of some doctor who drops by to stick a band-aid on the patient and then bill $173,000 for “out-of-network” services without telling anyone (including the patient). This scam is known as “drive-by doctoring.”
It’s one of the infinitely many con jobs used by America’s greedy incompetent doctors to jack up the fees they charge. And when will Mayhew write a post about dealing with drive-by doctoring?
…Why, never.
Mayhew, like the rest of the parasites infesting America’s broken medical-industrial complex, profits from drive-by doctoring. Anything that drives up costs benefits parasites like Mayhew.
Buy a small piece of property in Canada and get dual citizenship. That’s the solution to America’s hopelessly broken medical-industrial system.
KithKanan
@mclaren: Aside from this one?