Watch Out for New Exclusions to Payer Plans
The Affordable Care Act has reaped a multitude of consequences (good and bad) throughout the healthcare industry. One of them is obvious: Since there are more insured patients at large, there is a larger pool of potential patients to welcome into your practice.
But that seemingly logical conclusion may not be as likely as it seems. In fact, your practice may be seeing fewer patients. Why? One consequence of the healthcare law is that fewer patients in your local area may be in-network for your practice.
The culprit is the so-called “narrow network” trend. Narrow networks are broadly defined as any payer plans with only 30-70 percent of local hospitals participating, and they make up around half of the products available for purchase on national and state healthcare exchanges. The narrowness isn’t just limited to hospitals, as physician practices face exlusions, too: Susanne Madden, president & CEO of the healthcare consulting firm The Verden Group, has said that most payers included only about 20 percent of their entire provider network in their 2014 exchange plans.
Why it’s Happening
What’s driving the trend?... Mostly, price. To control expenses, payers are excluding physicians who provide care at higher costs. Since they can no longer save money by denying patients with “pre-existing” conditions or by charging chronic healthcare consumers more, it’s unsurprising that payers are trying to cut out physicians who cost them more money.
The issue impacts physicians on both the in- and out-of-network sides of the issue. Out-of-network practices lose patients – many of whom don’t realize upon purchasing their plans that their preferred providers are excluded. In-network practices also receive lower reimbursements with exchange plans than with traditional or employer sponsored plans. And across the board, referrals are tricky when you don’t know whether fellow physicians are in-network on a narrow plan.
How to Deal
Narrow networks likely aren’t going anywhere, so your practice has little choice but to adjust to the new reality. If you only lose a few patients, the best action may be no action. But if you feel the narrow-network shift is significantly impacting your practice’s revenue, there are a few things you can do.
Excluded? Try to Get In. The first step is to figure out why you were not made in-network in the first place. Spot areas where you may be costing payers too much – such as if you tend to refer to pricy specialists – and consider whether you’re willing to adapt. Address the payer’s concern and ask the insurer to reconsider your inclusion.
Want Out? Opt Out. If the stingy reimbursements of a given plan are hurting your bottom line, review your payer contract and find your opt-out date. Give the payer plenty of notice of your intent to withdraw so you don’t miss any windows.
Verify, Verify, Verify. Never assume you’re in-network, even for well-established patients. Check insurance on each patient and get every possible preauthorization.
Keep an Eye Out. As we saw during the last open enrollment period, plans are bound to change significantly year over year. Stay on your toes and keep the lines of communication open with major payers. Try your best to find out about modifications to common plans in advance so that you can plan ahead to minimize their impact on your practice.
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