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Saturday, December 7, 2013

Health Care Exchange Hidden Surprises

Leigh Page published an article on the American Health Care Exchanges in the British Medical Journal this week. It is behind the pay wall but for those who have access to read the full content, it is well worth doing. The stories described are startling. For example:
Physicians who don’t want to participate, however, are finding it’s not so easy to do. Last year, David Aizuss, an ophthalmologist in Encino, California, was sent an exchange contract from Blue Shield of California, with the payment rates left blank, to be filled in by the plan later. “They were basically asking me to sign a blank check,” Aizuss recalls, and he refused to do so. But later he found his name on the plan’s provider list, contacted Blue Shield and had it removed. He found out the insurer planned to pay him 70% of his usual rate.
 Ok, the idea that insurers try to extract lower payment rates from practices is not new news. But there is more...
In many cases, the physician’s affirmative assent is not required. Under the contract, the plan only needs to send physicians a notice, and they will be included in the new network unless they opt out in writing within a certain period, typically 30 to 60 days. Practices may never see these notices. Depending on the terms of the contract, they may be faxed, e-mailed or simply posted on the plan’s website. A notice may be just one of countless communications from dozens of different plans, covering a variety of issues. “Half of the time they are not even read,” said Sam Unterricht, president of the Medical Society of the State of New York. “Who has the time to read all this stuff?” He added that practices should make a special effort to keep track of these communications. In other cases, through an “all products” clause in the contract, plans do not even have to inform physicians that they are putting them into a new network, said Sidney Welch, an attorney specializing in physician contracts at Kilpatrick Townsend and Stockton in Atlanta. All product clauses are banned in states like Texas and Connecticut but not in New York, where a survey of physicians by the Medical Society of State of New York (MSSNY)
found that 16.5% of them had been forced to join exchange plans through such clauses.2
OK, now this is getting serious. You cannot even discern whether you are part of the network or specific plans. What other surprises are lurking? More...much, much more.
Curran added he was concerned about some aspects of the new arrangement. For example, if enrollees stop paying their premium, federal regulations require a “grace period” in which they can still get care. The insurer has to continue paying claims for the first 30 days, but the physician must continue providing care for 60 days after that, with no assurance of being paid. In the MGMA survey, 59% of practices cited the grace period as a reason for not joining exchange plans.
I guess there is always the option to opt out and not participate in the Exchanges. Maybe, maybe not...
Unterricht thinks that once physicians know they are in exchange networks and have to grapple with the problems, there will be a mass exodus from them. “The network that existed last April [when New York plans vouched for network adequacy] will not

be in place come January or next April,” he said. Opting out, however, could be challenging, according to Welch, the contract attorney. The contract may stipulate that the physician must stay in the network for a certain period of time. Physicians who can’t get out might refuse to see exchange patients, but under the terms of many contracts, the physician would be barred from seeing new patients in all the other networks the insurer operates, Welch said.

What I find most interesting is that this is published in the British Medical Journal, not JAMA or the NEJM.  


  1. Physicians who contracted with insurance companies, and in particular those who didn't read the fine print or have a health care attorney review it for them, have only themselves to blame. A contract is a contract, voluntarily entered into.

    Granted it is difficult to practice in an environment where patients expect or feel entitled to their health care being paid for through insurance and will forgo care that is not underwritten. But the physicians who made their deal with the devil a long time ago and then drank the Kool Aid that they were doing so in the best interests of serving patients who could not otherwise afford health care are now stuck with that Faustian bargain. They will not be receiving the remuneration for their services and their patients will be not be receiving the quality of care they anticipated; radical increases in volume are the only way to offset the reductions in reimbursement.

    There's an old saying that is relevant here that both parties should be aware of: "The only way to win in a crooked poker game is to quit."

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