Blue Dog Democrats Raise Concerns for Healthcare Reform
The Blue Dog Coalition, a group of fiscally conservative House democrats, has submitted a letter to Speaker Nancy Pelosi and Majority Leader Steny Hoyer outlining a number of concerns about the Tri-Committee draft health reform bill. American Society of Anesthesiologists (ASA) strongly supports the Blue Dog Coalition’s concerns about a public plan option based on Medicare payment rates.
ASA President Roger A. Moore, M.D., has released the following statement in response to the Blue Dog Coalition’s letter: “On behalf of ASA’s 43,000 physician members, I applaud the Blue Dog Coalition members and leadership for opposing a public plan option based on Medicare rates, and for recognizing that a Medicare-like public option would negatively impact doctors and patients. Further, I am pleased that the Coalition maintains that physicians and other health care providers should be able to voluntarily participate in the program, rather than being mandated by Congress.
“We are working together on one of the most comprehensive health care reform efforts this government has ever undertaken. We commend the “Tri-Committee” members and staff for their efforts toward meaningful and effective delivery reform. However, we believe that as part of responsible reform, we must ensure that a public plan option fairly compensate physicians for their services. As it stands, Medicare pays anesthesiologists 33 percent of what private insurers pay—a rate that simply does not cover the costs of providing anesthesiology medical care. An expansion of this inadequate payment system as proposed by the “Tri-Committee” would not be sustainable for private practice and academic anesthesiologists.
Silent PPOs and Rental Networks
Most group practices are losing as much as 5-8% of their their reimbursement through illegal discounts taken by carriers who rents provider networks and agreements. When a physician contracts to join a health network, he or she agrees to accept a discounted rate in return for the network steering patients into his or her practice through a listing in the health plan’s directory. However, this discounted rate has been high-jacked through a deceptive market practice called a “silent PPO” or “rental network.” A silent PPO/rental network is neither insurance nor a health care payment plan offered by a health plan to its clients. Silent PPO/rental networks are not regulated and create a huge obstacle to heath care transparency.
A silent PPO/rental network generally takes no financial risk. The network “shops” around to find the lowest rates a physician has agreed to with any insurer, then “rents” that discounted rate to another entity without the physician’s knowledge or permission. Fourteen states have laws to prohibit these arrangements.
Patients also may suffer financially when the discount applied to their medical treatment is based inappropriately on the lowest contracted rate of a silent PPO/rental network. The patient may have to pay more toward the unpaid balance and incur higher coinsurance.
Silent PPO/rental networks provide no benefit to physician practices or their patients. Physicians may become wary of granting discounts under their existing contracts or are forced to increase their existing contracted rates to offset losses from these unethical manipulations.
Physicians should support legislation that will: 1) regulate how a physician’s contract rate is sold, leased, or shared among health plans, 2) ensure the physician’s right of action against anyone who improperly accesses their price discount and 3) encourage the state Department of Insurance to enforce current state insurance laws to alleviate this deceptive trade practice.
Compliants against a silent PPO or rental network should be filed with the state insurance commissioner’s office.
