Lydia Nuzum | March 19, 2016
Doctors treating patients covered by the state’s largest insurance carrier’s Affordable Care Act individual insurance plans will receive a lower reimbursement rate, after continued high use has forced the insurer to subsidize those plans with its larger group earnings.
Fred Earley, president of Highmark West Virginia, said the reduction is small — the reimbursement doctors will receive for performing examinations and medical procedures will fall 0.6 percent starting May 1. Plan consumers will not see their premiums or copays affected by the change, Earley said, and the reimbursement rate for doctors will still be higher than those for government payors like Medicare and Medicaid.
“We’re in the process of evaluating a number of things to make this market stable,” Earley said. “We have to make it sustainable, because right now, at least historically, it has not been. We have been utilizing the strength of our overall financial position and our reserves so far to subsidize that market and continue to cover the West Virginia residents who have been with us for the last two-plus years…but we need to get this particular segment of the population to where it is self-sustaining.”
The demand for medical care has not slackened in the individual market since Highmark rolled out its ACA plans for that population, Earley said, and as a result, the company has been forced to request premium increases on those plans for the last two years. Highmark and other insurers participating in the exchange have also not received the risk corridor payments promised to them by the federal government, and Highmark reported last year that it was missing $11 million in risk corridor payments.
“We are hopeful that at some point in time that payment could come, but we have to move forward, recognizing that we may never get that,” he said. “It would be beneficial to help offset the losses we’ve incurred in the last two years, but ultimately, those risk corridor payments were set to go away after 2016 anyway, so it was really to allow some flexibility and stability. We would be on our way to this path regardless, because even if those payments were made, they would disappear after 2017, for business done in 2016…we have to move forward expecting that we will not ever receive this.”
Earley said the reimbursement reduction will save Highmark roughly $4.5 million annually.
“Nobody likes to see reductions, regardless of the rationale or purpose behind it, but our goal is to do what we need to do to sustain and stabilize the ACA market in West Virginia,” Earley said.
The reduction will put individual ACA plans reimbursement rates below those of Highmark’s other commercial insurances, but Earley said he believes health-care providers will not be discouraged from taking on patients with the plans.
“Our hope is they won’t, remembering that three years ago these consumers were largely uninsured, and they were receiving care they were paying for out-of-pocket, or providers were receiving nothing for their care,” he said. “They’re still far better off today with these reductions than they would have been three years ago. We’re hopeful that the commitment to continuing to provide access to quality health care to these members remains unchanged.”
Source: West Virginia Gazette
http://www.wvgazettemail.com/news/20160319/highmark-changes-aca-plan-reimbursement-to-curb-costs