Insurers Cut Doctor Fees, Restricting Networks Under Obamacare

Friday, 22 Nov 2013 09:01 AM

By Lisa Barron

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Healthcare insurers are cutting the fees they pay to doctors on many of the new plans offered through the Obamacare exchanges, which could cause more medical practices to shun those marketplaces.

United Health Group, for example, sent physicians in New York City new contracts this month that included much lower rates than doctors normally get from private insurance, reports The Wall Street Journal, which obtained confidential documents.

"We have heard from a lot of physicians the rates [insurers] are offering them are very low, and physicians are questioning whether they are going to participate," Sam Unterricht, a Brooklyn ophthalmologist and president of the Medical Society of the State of New York, told the newspaper.

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The documents show that some of the rates being offered by United are similar to those paid by people on Medicaid. The fees for some office visits are less than half of what New York City doctors get for treating patients on employer-sponsored plans.

WellPoint's Anthem Unit in Connecticut also is slashing payments, offering one ear, nose, and throat specialist in Trumbull rates that he told the Journal "were not what a reasonable person would consider acceptable."

He refused the contract.

A WellPoint spokeswoman said the plans were "focused on affordability, to allow the maximum number of individuals to purchase coverage."

But not all doctors are willing to accept the lower rates and have the ability to opt out, meaning consumers could choose a plan based on doctors who ultimately decide not to participate.

"It is going to be very tough for consumers to have accurate information about which physicians they really have access to," Paul Ginsburg, president of the Center for Studying Health System Change, told the Journal.

Meanwhile, some insurers are restricting consumers' choices of doctors and hospitals, excluding top-rated facilities, in an attempt to keep costs down, reports The Washington Post.

In Washington state, for instance, Premera Blue Cross did not include Seattle Children's Hospital as an in-network provider except in cases where the treatment could not be found elsewhere.

"Children's non-unique services were too expensive, given the goal of providing affordable coverage for consumers," spokesman Eric Earling told the newspaper.

For Seattle resident Jeffrey Blank, that means his daughter Zoe, who was diagnosed with a rare bone disorder, no longer will be able to go to Children's for routine checkups without it being billed as a much more expensive out-of-network visit.

"It just stresses me," Blank, who is self-employed, told the Post. "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."

Seattle Children's Hospital has sued Washington's insurance commissioner for being kept out of many of the state's provider networks.

Many of the country's other leading hospitals — including the Mayo Clinic in Minnesota, Cedars-Sinai in Los Angeles, and children's hospitals in Houston and St. Louis —  reportedly also have been excluded from most new plans in an attempt to keep down the cost of care.

The result in many places, experts say, could be a two-tiered system of healthcare, with those on individual plans receiving coverage far inferior to that available to those covered by their employers' plans.

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