WA insurers, providers object to proposed network rule

Washington state insurers and hospitals have united in opposition to state Insurance Commissioner Mike Kreidler's proposed new rule for insurance-provider networks, according to a report by Kaiser Health News and the Seattle Times.

Kreidler says the proposal is in response to complaints that consumers weren't prepared for the narrow networks offered under Affordable Care Act insurance plans, which exclude some of the most prestigious hospitals and medical centers in the region, according to the article. For example, only three insurers that offer plans through the Washington Healthplanfinder online exchange include Seattle Children's; the hospital has filed a lawsuit over the narrow networks.

The new rule would establish several requirements to broaden networks, as well as minimum standards to include a diverse array of essential community providers. It also "requires insurers to disclose tiers of networks that require different cost-sharing on the part of patients," according to the article.

Kreidler may implement the rule as early as this week to make the May 1 deadline for insurer plans for 2015 coverage. Hospital groups and insurers say this does not give them enough time to provide input into the rule. "The fact that both sides are not happy does not translate to this being a reasonable compromise," Barbara Gorham, Washington State Hospital Association policy director for access, said in a hearing this week. "What it means is that the process hasn't been given enough time."

The rule will "collapse choices that ought to be available to individuals and employers," Mel Sorensen of the Washington Association of Health Underwriters said, according to the article. The problem of narrow networks may be self-correcting, Sorensen suggested, as providers excluded from 2014 networks may accept lower reimbursements in 2015. "Very likely, you'll see hotter, more competitive bidding," he said.

A March report from Moody's Investors Service found narrow networks may hurt hospital finances in the long term, FierceHealthFinance previously reported.

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