Narrow Network Insurance Plans Could Spark New Regulations
When Michael Justice was laid off from a local college last year, he lost a job he liked, a paycheck he needed and an insurance plan he relied on.
At 63, he’s now buying a policy to cover him and his wife. The bill every month is $1,638.
“It’s more than we pay for mortgage, its more than we pay on property taxes, which in New Hampshire is saying a bit,” says Justice. “It’s more than we pay for heating oil, more than we pay for electricity, more than we pay for water.”
Justice doesn’t view this as an optional expense. A heart attack six years ago taught him the value of good insurance.
And so the Peterborough resident was excited for the Affordable Care Act. With the available tax subsidies, his monthly premiums would drop by almost $400 a month.
But that excitement faded when he heard Monadnock Community Hospital wasn’t included in the plan Anthem is selling in the exchange. His primary care doctor, cardiologist, and eye doctor are at MCH. Buying the cheaper insurance means losing their services.
“I’ve had experiences with having to change doctors, and it is difficult,” says Justice. “Where I can go in and see my doctor or my doctor is walking down the hallway into the Emergency Room, and there I am, he knows me. And I don’t have to have that fear enhanced by the fact that I don’t know who this doctor is coming in who doesn’t know me.”
For its part, Anthem acknowledges that a more limited network of doctors will be an inconvenience for some. But in defending the plan before lawmakers recently, Senior Legal Counsel Maria Proulx says Anthem followed the law.
“We understand that this isn’t going to meet the needs of everyone,” says Proulx. “But that we set out to meet the needs of the majority of the population, and when we designed the network, we worked within the rules the way they are drafted in the network adequacy, and we meet those network adequacy requirements.”
Those network adequacy requirements are laid out in what’s called Insurance Rule Number 2700.
State health policy analyst Tyler Brannen says the statute and regulations are meant to guarantee people have access to services without unreasonable delay.
“Both are intended to set a floor, a very basic network, really so an insurance company can't come to the state and sell you a product that requires you to go to New Jersey to see your physician,” says Brannen. “So to the extent that it establishes a floor, that’s all it is.”
The minimums are based on geography. For example, a plan needs a hospital within 45 miles or 60 minutes’ drive of customers. There needs to be at least 2 primary care doctors within 15 miles or 40 minutes’ drive.
Similar guidelines exist in many states. New Hampshire’s were written in 1997, and Brannen says they haven’t been updated since.
“I think we need to reevaluate the rules because they’ve been around for so long to begin with. To the extent that you think that medicine has changed, then we’re probably due for a review.”
Brannen cautions, though, that any change could add to the cost of health insurance.
If you force a company like Anthem to include more or, say, every provider, it loses bargaining leverage. That’s good for hospitals, but bad for consumers.
So while regulators may take a cautious approach, a proposed bill in the New Hampshire statehouse takes a different tack.
It would require any insurance company that sells plans in the new health exchange to at least offer every hospital a spot in its network.
First term GOP Representative Bill Nelson of Brookfield says the change is necessary to level the playing field. A hospital-affiliated clinic in his own district was excluded from Anthem’s plan.
“Anthem gets to pick the losers and winners,” says Nelson. “I mean, that’s the issue. The whole thing just isn’t fair.”
Michael Justice agrees. He says cost can’t be the only driver for how health plans are designed.
“I don’t think it is about counting beans. I think it is about counting quality of life and the lives you save.”
Justice says he’s still hasn’t decided what he’s going to do. Lawmakers will begin making their own decisions on the issue in January.