Last week, there was an important story out of California. Insurance regulators fined the two largest insurers for having craptastic directories. Additionally, the regulators, as empowered by California law, are holding individuals harmless by requiring the insurers to attribute cost sharing as if the providers were in-network as the individuals had a rational and reasonable belief that the providers were in network.
The state’s Department of Managed Health Care levied fines of $350,000 against Blue Shield of California and $250,000 for Anthem Blue Cross.
At issue were the companies’ error-riddled provider directories that frustrated many consumers statewide as they tried to find doctors during the rollout of the Affordable Care Act in 2014. As a result, some patients incurred big unforeseen medical bills because they unwittingly went out of network for care….
The state said Blue Shield has already reimbursed more than $38 million to enrollees who incurred out-of-network costs. Officials said they didn’t have a reimbursement figure for Anthem yet.
I had a very enjoyable back and forth with Claire McAndrews of Families USA concerning directory accuracy and she pointed to an interesting secret shopping study on the Maryland market:
@bjdickmayhew @CMSGov Ready for a lot of secret shopper studies? Stop me if you’re not interested. Love this one: https://t.co/u1EALU4wjA
— Claire McAndrew (@claire_mcandrew) November 5, 2015
Most of the insurers (page 9) had a large number of psychiatrists in the directory but a large number of false positives, non-psych specialities, and even fewer had psychiatrists who could make an appointment for a new patient in a reasonable time frame. However one insurer showed a much smaller network of psychiatrists but that very small network had a very high percentage of useful information.
This study raises an interesting set of questions below the fold:
I’ve been told that I have an unusual introduction to my pregame when I am working with referees that I’ve not worked with before. I’ll introduce myself, suggest that we walk the field and then the opening line of my actual pre-game is the following:
“Our first priority today is player safety and our second is fairness; when we make errors, I want our errors to lean in those two directions. I want this game to be safe, and I want this game to be fair”
An experienced but new to me assistant referee said that he was chewing on that line for the rest of the game as he had not thought about the game in that way before. An assessor commented that he thought the thought process was very good for where I am now but if I was ten years younger and 15% faster, it would have limited my advancement.
I had made a decision several years ago that I would limit some of the risk in the game in order to favor safety and fairness. This limits my ability to be in a game where the entire game is played at the cliff edge of beauty and chaos, but it also limits the long term injuries and the probability of a game going to shit. This was a deliberate decision as to where I want my errors to lie.
Provider data is messy data. In my experience, the only reliable provider data is data that is directly tied to money. That means the tax id number is reliable, that means the NPI, Medicare and Medicaid numbers are reliable, and that means the address to send the payment to is reliable. And if it is not reliable, the providers are very good about changing that data without prompting as a missing check or EFT fund transfer will get their attention quickly. Everything else is far fuzzier. Addresses are often not in US Postal Service standards, locations that have not been open for years will not be reported as closed, providers who moved to Arizona to work on their golf game or have joined the choir invisible are not reported as terminations. Panel status (the ability to take new patients) and office hours are also often fuzzy. My PCP has three sets of hours for Thursday reported in the three largest commercial network directories (Mayhew Insurance is accurate because I took a photo of the new hours and sent it to our provider folks who I used to work with) .
Messy data means significant assumptions need to be made in how it is presented.
I think about this in the context of directories as most insurers are making a decision (given my experience, an unconscious decision) to have errors that cast the illusion of a much broader network. Right now the cost of errors going in that direction are mostly borne by members and not the insurance company unless the state has aggressive regulators with strong tools to do their job. California has a hold harmless provision that makes the cost of a bad directory be borne by the insurer.
The Maryland study does show an interesting possibility of a counter-example. There a decision was made to show an accurate network and potentially under-report the network. Errors would be errors of omitting participating providers instead of errors of including non-participating providers. Members would be very confident that if they picked up the phone, they would be talking to a provider that could help them. In the other cases, it was a crap shoot if the provider that they reached was actually able to help them. There may have been providers in the network but out ofthe directory because those providers elected to sign up for the network to maintain a relationship with one or two patients but they did not want any more calls for treatment slots that did not exist or they could have an idiosyncratic group contract that brought them into the network but for practical reasons, they were effectively unable to treat. One example is a provider who is technically in network as he is a guest lecturer and very odd case surgeon who flies into Shelbyville two or three times a year for weird surgeries but is otherwise practicing 97% of the time in Los Angeles.
The health insurance industry seldom makes a conscious decision as to what type of network directory errors they want and it hurts.
Here I Am, Stuck In The Pyramid-dle With You
Punchy
(….not seeing the part about refs sleeping with hot coed midfielders…)
/gives up and complains about the redesign
benw
$350k and $250k are pretty meaningless compared to $38M in reimbursements. I guess the fines were low because the companies are already paying out? Still I can imagine the stomach-dropping feeling of those patients getting their first out-of-network charges on their EOBs. Hello, unexpected $10,000 billing statement! I’ve been there and its no fun, even if you call the insurance and they admit to fault and fix the charges without too much fuss.
As for the shitty directories, I learned very, very quickly that the very first thing I do is verify, in detail, over the phone with a real, live person, that everything that might happen at my potential new provider’s office is in-network or covered by my plan. Then I go down the list of all the information on the webpage: Drs. names, address, what type of Dr they actually are, etc, because usually some or all of it is flat out wrong. Fun times!
Xboxershorts
I live in a very rural county in North Central PA
I landed a job with an outfit who’s HQ is Metro Boston
Their Health Insurance (An Aetna subsidiary out of MN) was Boston/New England Centric as far as provider networks go
Our tiny rural hospital was not in network
So, I called the Insurance Carrier customer service number and explained my situation
Gave them the rural hospital contact info
And they actually added our tiny rural hospital to their network.
Can this kind of thing happen often?
PS, 2 days into my new job with this outfit, I broke my 3rd lumbar vertebrae, so off the bat,
I had major charges to the carrier and after much back and forth, they did cover it…
For a for profit insurance carrier, I was really surprised by this.
(I am recovering on schedule, still quite sore over a year later, but much improved, thanks for asking)
satby
@Xboxershorts: good to hear you’re recovering!
Richard Mayhew
@Xboxershorts: I’ll be stealing your scenario for a post some time in the next week or two as it is highlighting the problems with out of area coverage AND the concept of national networks and national wrap-around networks.
Yes, this thing can happen. You’re massively out of area but your insurance is through a national carrier or a subsidiary of a national carrier. The national carrier most likely has a contract for North Nowhere Medical Center for one of their Pennsylvania/New York/New Jersey subsidiaries. The claim from the insurance provider point of view would have been paid at in-network rates most likely. The Massachusetts/New England Centric network that your employer was offered and thus was offering to you was a slice of the total Aetna network. The slice was offered for cost control (Aetna does not want a person from Boston flying to Mayo instead of driving to Mass General)
So Aetna New England just reworked the a network routing table for your employer to add North Nowhere Medical Center from the entire universe of Aetna contracts to your specific network. Or there was a note entered to your member profile saying that North Nowhere Medical Center should process as par. I don’t know how Aetna works their claims, but those are the two common ways to flag a local exception. Not a big deal, those types of exceptions are easy to plumb. Aetna has no problem doing this because it does not cost them a penny and they are very confident that no one from Springfield Mass is driving to North Nowhere Medical Center for elective care.
Served
Chicago is currently in a pretty big kerfuffle about BCBS not having Northwestern in its widest coverage for the coming year. It’s a very big provider for the area (home to my primary care physician and where I get most of my screenings and tests done), so there’s a lot of “Thanks Obama” and “Obama said we wouldn’t have to switch providers! HE LIED!” It’s hard to explain that it’s the provider making them switch, though, because until Obamacare, health insurance companies operated in the shadows. Obamacare brought the industry into the sun, but became a shield for insurance companies.
japa21
@Xboxershorts: Insurance companies are quite amenable to working to get a provider into network if 1) there are no other providers in the area to meet the patient’s needs and 2) the employee works for an important enough company.
They are also willing, at times, to do single case agreements with a provider. However, the provider also has to be willing to agree to either join the network or do the single case agreement.
There have also been occasions where, even if the provider isn’t willing to do any agreement, that the insurance company will be willing to treat a provider as in-network in terms of benefits. The latter is rare, but will happen, specially if the employer is self-insured and requests the company do so.
I would guestimate that 90% of directory errors fall into the “provider screwed up” area. Richard outlined many of them above.
That does not mean the insurance carriers don’t screw up as well. Data entry is human driven and the people who do the entry are some of the lowest paid individuals in the company. Errors get made, provider communications get misplaced, etc.
You will almost always find a disclaimer with on-line directories that it is up to the patient to confirm with the doctor’s office that they are, in fact, participating.
japa21
@Served: It is similar to WGN complaining that a cable or dish provider is not going to keep them in their channel lineup and they are being unfair. WGN may well be trying to extort higher compensation, more than they deserve. The same thing with the provider refusing to accept the reimbursement the insurance company is offering.
It is, however, seldom that it all goes one way. BCBS has a tendency to think that any provider should automatically accept whatever they are willing to offer due to their large membership. As a result, they frequently low-ball the provider. There comes a point that seeing the patients, no matter how many, becomes a negative if they are losing money on each of them they see.
So it is usually a case of both of them being at fault to some degree.
Richard Mayhew
@japa21: I would say most provider directory problems have a root cause of insurer indifference.
Yes, providers are shitty at getting non-claims payment/quality bonus data to insurers. That is a standard operating assumption. Insurers are pretty bad about giving carrots and sticks to get good data, and even worse about verification. Yes, NCQA and CMS have quality points attached to a good directory, but a good directory is a cost center for most insurers, so the bare minimum is often all that is done.
japa21
@Richard Mayhew: I do agree, particularly with the carrots and sticks analogy. Although I don’t get involved with the actual directory creation, I am involved in the network development side of the business and guess who gets complaints from providers if the information is wrong? The fact the providers didn’t get us the accurate information is just a part of the problem.
Another issue is that, in theory, most of the data collection is done on line. A provider goes online and fills in forms and what not. The problem is that many of these belong to several different networks and it becomes very time consuming for a provider’s office. So instead, they do a physical mailing, usually to addresses that are on their contracts. These addresses, however, change and so a mailing may go to the wrong address and take forever, if at all, to get to the right location.
And fully agree with your last line. Too many insurers don’t realize that a little bit more money there avoids a lot of expenditures later.
rikyrah
glad you explained the details behind the headline.
much appreciated.
Mnemosyne (iPhone)
To mix a couple of the post’s metaphors, the California story shows how important it is to have a government agency that’s willing to step in and be the referee between the patient and the insurance company. California’s regulators are taking that job very seriously and keeping a close eye on insurers, particularly known bad actors like Anthem. In red states, that regulation is probably going to be a lot weaker and people are probably going to get screwed.
jl
Thanks for very informative post.
I believe it was Anthem Blue Cross that got its nonprofit status stripped in CA, because it’s behavior was indistinguishable from that of a for profit company.
Edit: or maybe Anthem was already for profit, and some remaining non-profit arm got it’s status changed to for profit. Anyway, these are huge and rather cynical operations, IMHO.
KithKanan
@jl: You’re thinking of Blue Shield of CA. Anthem Blue Cross has been for-profit since the 90s.
CA Blue Cross and Blue Shield are still separate companies unlike almost all of the rest of the country (I think Washington and Iowa are the other exceptions)
Snarki, child of Loki
A personal experience from a few years back, along the lines of the OP:
employer health plan, policy said “durable medical equipment covered 100% if from a preferred supplier, otherwise 30% copay”.
Months of badgering, they never had ANY suppliers on the ‘preferred’ list. Even got providers involved in lobbying to be put on the list. Later, out comes a ‘policy revision’, removing the ‘preferred supplier’ stuff.
Bait and switch.
Mnemosyne (iPhone)
@japa21:
FWIW, Anthem Blue Cross is under heavy scrutiny by CA regulators because they have been caught playing fast and loose with the rules multiple times. They may try to cover their ass with that disclaimer, but state regulators are not going to let Anthem enforce it because they’ve been caught breaking or bending the rules so many times before.
Lee
I have a bit of a dog in this fight.
Anthem Blue Cross is my provider (I’m in Texas) and their directory here is less than stellar as well. The problem is Texas does not regulate at all so hopefully CA will solve this problem for us.
The other issue about psychiatrists in your post is close to home. A few years ago my daughter was in need of mental heatlhcare. Trying to find a therapist or psychiatrist was damn need impossible on the Mageallan website (wrong info, not taking new patients, etc). I’m still pissed about it and it was years ago. The last thing someone needs when searching for a provider is an extra &#(&$*#& hurdle.
Fred Fnord
@Richard Mayhew: You don’t drive to Mass General, you take the Blue Line or the Red Line. Geez.