Legislation will cripple the networks that hold down health care costs
TALLAHASSEE, Fla., June 9 /PRNewswire/ -- It's been sold as merely changing an address -- the address to which a payment for services is sent. But SB 1122 will have vast, negative consequences to consumers and the State, consumer advocates warn.
"If you have health insurance, this bill will cost you money," said Walter Dartland, executive director of the Consumer Federation of the Southeast. "Now, in the toughest economy of our lifetimes, is not the time to put an additional financial burden on working Floridians."
Proponents of the bill ran a potent misinformation campaign that Dartland said has obscured the facts on a complicated but vitally important issue. Proponents contend SB 1122 will not affect doctors' participation in preferred provider networks (PPOs), will not result in "balance billing" to patients, will not have a fiscal impact to the State, has been successfully adopted by other states, and is supported by Humana, which operates a PPO. Here are the facts:
SB 1122 will undermine PPO networks by eliminating the key incentive for doctors to participate in networks - the guarantee of prompt, direct payment. If insurers are forced to pay doctors directly - even if doctors are unwilling to offer a discounted rate - there is no incentive for doctors to join networks and offer a discount. This will lead directly to higher health costs for businesses, workers and patients.
SB 1122 eliminates the market force that effectively restrains balance billing of patients. By participating in a network, doctors agree to accept the payment of the insurer as payment in full, and not bill patients any additional amount. SB 1122 will guarantee non-network doctors direct payment - without any such guarantee for patients. This will open the door for doctors to "balance-bill," or charge patients an additional amount over what their insurer will pay. Many patients will not be able to afford such out-of-pocket medical bills.
SB 1122 will have a significant fiscal impact on the State of Florida.
The State's own actuaries estimate the fiscal impact to the State Employees' Group Health Insurance Program to range from $5.1 million to $18.5 million in FY 2010-2011.
Few states have broad requirements on direct assignment of benefits, and most states have decided against enacting such a policy due to the radical disruption that would result in established PPO networks. Since 2005, the only state other than Florida to enact any such a law was New Jersey in 2007, but that law applies only to ambulance services.
On the contrary, a growing number of state regulators are moving to crack down on practices such as balance billing, which SB 1122 would help make more common. In December, the Wall Street Journal reported the New York State Insurance Department is drafting proposed regulations that could force more disclosure by medical providers and insurers and shield consumers from unexpected charges. California regulators recently made it illegal for people covered by health maintenance organizations to be balance-billed for out-of-network emergency services. And late last year Illinois put out a bulletin that protects many consumers from balance bills in certain situations if they make a "good faith" effort to use in-network doctors.
Proponents of SB 1122 fought off numerous attempts to insert consumer protections against balance billing and unreasonable medical fees at each stage of the legislative process. Florida will be out of step with the rest of the country if it approves SB 1122 with no such consumer protections.
Humana supports SB 1122 because the bill would adversely affect its competitors, which are able to provide lower rates through their networks because they do not provide direct payment to non-participating physicians. Insurers such as BlueCross BlueShield of Florida are able to leverage the benefit of prompt, direct payment to induce physicians to provide discounted rates to patients. Humana provides direct payment to out-of-network providers because of a 2005 settlement in a federal lawsuit brought against it by representatives of 700,000 physicians.
"The Governor is the last line of resistance to protect consumers from higher health care costs at a time when they can ill afford another financial burden," Dartland said. "I implore the Governor to look at the real facts and veto this bad bill."
A broad coalition of groups joins Dartland in opposing the bill, including Associated Industries of Florida, AFSCME, Florida PIRG, the Florida Alliance for Retired Americans, and Florida CHAIN. These groups believe SB 1122 will lead directly to higher medical costs for businesses, workers, patients and consumers.
|SOURCE Consumer Federation of the Southeast|
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