Health exchange cuts cost, choices
By Sandhya Somashekhar and Ariana Eunjung Cha THE WASHINGTON POST
As Americans have begun shopping for health plans on the insurance exchanges, they are discovering that insurers are restricting their choice of doctors and hospitals to keep costs low, and that many of the plans exclude top-rated hospitals.
The Obama administration made it a priority to keep down the cost of insurance on the exchanges, the online marketplaces that are central to the Affordable Care Act. But one way that insurers have been able to offer lower rates is by creating networks that are far smaller than what most Americans are accustomed to.
The decisions have provoked a backlash. In one closely watched case, Seattle Children’s Hospital has filed suit against Washington’s insurance commissioner after a number of insurers kept it out of their provider networks. “It is unprecedented in our market to have major insurance plans exclude Seattle Children’s,” said Sandy Melzer, senior vice president.
The result, some argue, is a two-tier system of health care: Many of the people who buy health plans on the exchanges have fewer hospitals and doctors to choose from than those with coverage through their employers.
- A number of the nation’s top hospitals — including the Mayo Clinic in Minnesota, Cedars-Sinai in Los Angeles and children’s hospitals in Seattle, Houston and St. Louis — are cut out of most plans sold on the exchange.
In most cases, the decision was about the cost of care.
In Seattle, the region’s predominant insurer, Premera Blue Cross, decided not to include the children’s hospital as an in-network provider except in cases where the service sought cannot be obtained anywhere else. Children’s non-unique services were too expensive, given the goal of providing affordable coverage for consumers,” spokesman Eric Earling said in an email.
For example, a pediatric appendectomy at Children’s costs about $23,000, he said. At another community hospital, the cost is closer to $14,100.
Melzer said his hospital often bills more than community hospitals for comparable procedures because the children it treats are often gravely ill, so even a routine tonsillectomy might be more complicated.
But as a result, families such as that of Jeffrey Blank, who has relied on Seattle Children’s since his daughter, Zoe, was diagnosed with a rare bone disorder, face difficult decisions. Under some of the new law’s health plans, the family would no longer be able to take Zoe to Children’s for her routine checkups, or if they do, it could count as an “out of network” visit, saddling Blank’s family with huge bills.
“It just stresses me,” said Blank, 53, a self-employed massage therapist who is sorting through his options but readily admits that his family has benefited from other parts of the health law. “I hope things continue wonderfully for my daughter and that she doesn’t need the level of care she got after her diagnosis, but there’s this unknown.”
A similar shutout isn’t expected in central Ohio in 2014. Nationwide Children’s Hospital said it will be part of the provider networks for exchange policies offered by Anthem Blue Cross and Blue Shield in Ohio and Medical Mutual of Ohio. A spokeswoman said the hospital is “still in discussions” with Molina Healthcare of Ohio and CareSource.
In New Hampshire, Frisbie Memorial Hospital took legal action against an insurer that excluded it from its marketplace plans, and in Missouri, consumer advocates successfully lobbied an insurer to add a children’s hospital after it unveiled a plan that lacked one.
Experts say that routine care offered at cheaper, community-based hospitals is often comparable to that at pricey academic medical centers.
“Academic medical centers are valuable because they are the only place to get certain specific treatments, but they provide a lot of care that is routinely provided in community hospitals that do it very well at a cheaper cost,” said Paul Ginsburg, president of the Center for Studying Health System Change.
- In some cases, the goal of lowering costs has prompted the opposite reaction: Providers themselves have balked at being in exchange networks because they are unhappy with the reimbursement rates or are concerned that the exchanges could be dominated by sick people who won’t be able to pay their portion of the bills.
The Cleveland Clinic said it decided to limit itself to plans on Ohio’s exchange that offered higher reimbursement rates and were backed by brand-name insurers.
Ohio State University’s Wexner Medical Center said it’s seeking to be part of provider networks that offer wide access. A spokesman said the center is part of the provider networks for marketplace policies offered in Franklin County by three health plans: CareSource, Molina and Medical Mutual. It is not part of the provider network for policies offered through the marketplace by Anthem, which is partnering with Mount Carmel Health System.
Some advocates argue that these narrow networks are a fine way to cut costs. They note that the majority of people expected to buy coverage on the exchanges are uninsured, and that even a narrow network is better than nothing. (*)
Insurers “looked at the people expected to go on the exchanges and thought, ‘These are people coming out of the ranks of the uninsured. They don’t care about the Mayo Clinic or the Cleveland Clinic. They will go to community providers,’” said Robert Laszewski, a health-care industry consultant.
Insurers will typically cover out-of-network costs in an emergency. And most hospitals are included in at least one plan. (*)
“I can’t find you a plan with all the major facilities, but if you give me a hospital, I can find a plan participating in it,” said Elisabeth Benjamin, vice president of health initiatives for the Community Service Society of New York, one of the agencies helping consumers navigate their new insurance options.
The Affordable Care Act requires insurers to provide enough doctors and hospitals to ensure quality care. But there is no detailed guidance from the federal government on what this means. (*)
“It’s been mostly up to the plans to attest to it, and for now, everyone’s taking their word for it,” said Karen Pollitz, a senior fellow at the Kaiser Family Foundation. (*)
In New Hampshire, consumers who buy insurance through the exchange have only one choice of carrier — Anthem — because no other insurer applied to join the exchange. The company’s network includes access to only 16 of the state’s 26 acute-care hospitals.
- That is forcing people such as Michael Justice, 63, a Web developer from Peterborough, N.H., to leave doctors they like. Justice said he and his wife could go with another insurer, which costs $1,600 a month outside the marketplace, and continue to see their providers. Or they could save around $400 with subsidies if they buy on the exchange. “We’re being forced to choose between one bad option and another bad option,” Justice said.
Anthem spokesman Chris Dugan said that consumers under the plan are seeing prices that are 25 percent lower than they would have been with a broader network, and that the company found in surveys of more than 50,000 consumers across the country that most people would choose cost savings over being able to see a particular doctor. He said the network still covers 74 percent of all primary-care providers and 78 percent of specialists.
“This wasn’t something built overnight,” Dugan said. “We took a very thoughtful approach to this.”
Jeffrey Blank is among the hundreds of thousands of Americans whose insurance policies are being canceled at the end of the year. His insurer, Premera, has suggested that he enroll in the new Premera plan on the marketplace. But Children’s is not in the new network. So Blank must choose. Should he take his insurer’s suggestion and lose access to Children’s? Should he go with one of the plans on the exchange that includes Children’s, even if that means picking an insurance company he has never heard of? He is leaning toward buying a private plan with Premera outside the exchange with a broader network, but that would force him to give up the $400-permonth government subsidy.
Blank faults the insurer, not the health law, he said. Before the law’s enactment, insurance companies routinely put a dollar cap on the amount of benefits a person could receive in a lifetime. Without the law, Zoe, 5, who was diagnosed with osteopetrosis when she was 8 months old, probably would have reached that cap before adulthood, her father said.
Premera has said it will consider “unique” treatments available only at Children’s as in-network service. But the decisions about what is considered unique will be made case by case, Blank learned, so he has decided to reject that option.
“What if Zoe has to be hospitalized? What then?” Blank said. “I should have a plan that is ‘in network,’ to be prepared. As wonderful as the Affordable Care Act has been for us, it’s like, how did this happen?”
Dispatch Reporter Ben Sutherly contributed to this story.
There is no question that I appreciate what our president has tried to do for us. He was indeed looking for justice, fairness and equality for all of us. Have already belabored this subject to death as I feel like so many others, the only fair way to do this at all was the single payer (Medicare) system already in place – just expanded and given to all with of course, appropriate tax increases to cover the costs. Boom. Done.
As to those 4 asterisks above; they connote “Trust me.” Don’t think anyone should ever take authoritative words as real or scientific or truthful. It is open to discussion and one must always question everything and endeavor to get stuff in writing. So this is a perfect example of ‘stuff’ you want clarified from the Whitehouse or Secretary Kathleen Sebelius. TELL EM! DISCUSS YOUR CONCERNS! Demand action.
I believed that the infernal squabbling over all these details was destined to bring much pain, confusion and needless suffering. And look at all this now! If only the Pope could have been involved in the decision making — now there’s a man who does know how to get things done! Of course, he isn’t looking for approval. He has a job to do and his focus is on that – (his father’s work, as laid on his heart). Nothing will deter him.
Our president has been cowed by every utterance out of the political Right’s mouth. I know what lack of acceptance is like, but I’ve never had to deal with such vile hatred and vicious lies and venom and frankly, most of us can’t even imagine it. And yet he rises daily to do his job and even manages a smile here and there. President Obama has paid a huge price for his vision and dreams. The criticism he is taking for the last years since taking office has been non-stop, over-the-top and insane. His every effort has been blocked — then they deride him for accomplishing nothing – a do nothing president. If people have no conscience, perhaps is isn’t fair to think they even understand what “shame” is.
Well, the issue at hand is ACA, not GOP. The joke will be on the nay-sayers as it all comes out in the wash and evens out and settles down and finds it’s rhythm. The job will get done. . . it already is coming together. People like me, well, I’m hard to please. Haven’t seen a doctor in a year and may never see one again. Wish I could get my $100 contribution back to me which is going to Medicare – I could use it on all the supplementation I require to keep my body working right. Since I won’t accept mammograms, and all the vaccinations others praise and don’t do pharmaceuticals, unless someone runs me over while I’m out walking the dog — why would I even want to? Are they able to discuss my real body needs? Don’t think so. Meanwhile if you would like to be as free from medical worry as I am, be sure to watch the free screening of the FOOD MATTERS movie next door to this post. Miss y’all, Jan)