Insurers invoking all-product clauses to fill exchange plan networks
Monday, March 03, 2014
Some physicians are experiencing confusion and surprise by learning they are contracted to accept patients covered by insurance exchange plans despite the fact they rejected offers to participate in those plans.
Plans are invoking what is known as an “all-product clause.” This is a provision many physicians may not be aware are present in their contracts, but essentially force physicians contracted in a particular payer plan to participate in all of the plans offered by that payer in the state, including those offered through the exchanges.
All-product clauses are not new; they have been included in payer contracts for many years. But physicians rarely saw them invoked on a large scale until now, said Lisa Folberg, vice president of medical and regulatory policy at the California Medical Association. They are being invoked in California because some plans are having difficulty getting enough physicians to voluntarily sign up for the plans, putting them at risk of not meeting adequate network thresholds.
The Affordable Care Act requires that Medicaid and exchange plans provide “adequate networks” that meet the needs of the plan holders. It’s up to each state to define what constitutes an adequate network.
For many states, adequacy is measured by geography: Each plan member must have at least one primary care physicians within so many miles of each member — many states say 30 miles. Others define adequacy by mandating a primary care physician to member ratio (one PCP for 2,000 members, for example) be maintained. In California, there must a primary care physician within 15 miles or 30 minutes of each plan member.
Many of the exchange plans were offering reimbursement rates that fell below those of commercial plans. After physicians rejected them, they were brought in under an all-product clause, but at rates that matched those offered by commercial products, according to Folberg.
Blue Shield of California spokesman Sean Barry said physicians were asked to sign contracts at a discounted rate in an effort to keep the products affordable to members. But the plan added physicians to the networks under “current contractual terms” in certain counties in order to meet the adequate network thresholds. Barry would not confirm those contractual terms were all-product clauses, saying the contractual terms are proprietary. But, he added, reimbursement rates were not raised for those physicians brought in, nor does the company plan to raise them.
Because some physicians never signed contracts for the exchange plans, they are quite surprised to find themselves in the network, Folberg said. Patients are calling physicians whom they find in the directories only to be told that that physician is not participating. Then the physician later learns they are, in fact, participating. “It’s really confusing for the patient,” she said. Physicians in other states are experiencing similar confusion.
In Texas, physicians have been affected two ways by all-product clauses. “There were physicians who wanted to be in the network, but were excluded because … some of the carriers were using narrow networks. And there were other physicians who were not contacted and not told, so they didn’t think they were part of the network but discovered that they were,” said Lee Spangler, vice president of socioeconomics for the Texas Medical Association. “All-product clauses are one-way streets,” Spangler said. “The plan can designate whether you are in or out.”
The TMA is telling its members to check with their insurance carriers directly because there have also been issues with the insurers’ physician directories being woefully inaccurate.
Members of The Medical Society of the State of New York experienced similar confusion. A survey conducted last fall revealed 40 percent of 405 doctors surveyed said they didn't know how they wound up on insurers' exchange plans. Just 6 percent said they chose to be on the exchange plans. Sixteen percent said they had to participate as a result of an all-product clause.
The medical society sent a letter to the executive director of the New York State of Health in December expressing concern over the implementation of the exchange plans. The letter cited the confusion physicians and patients were experiencing due to a lack of information about plan participation.
Folberg said there have long been issues with inaccurate information being maintained by the insurers, especially in their physician directories. “Those problems are now coming into full view.”
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