Provider Non-Discrimination

The FEHBlog nearly fell out of his chair when he read that the ACA regulators are seeking public comment on the scope of the law’s provider non-discrimination rule (Public Health Service Act § 2706(a)). This law essentially expands the FEHBA’s medically underserved area rule nationwide. OPM explained the medically underserved area rule (5 U.S.C. § 8902(m)(2) as follows:

If you live in a medically underserved area and are enrolled in a fee-for-service plan, your plan must pay benefits up to its contractual limits, for covered health services provided by any medical practitioner properly licensed under applicable State law.

On April 29, 2013, the ACA regulators in FAQ XV explained that Section 2706(a) is self-implementing and does not require a regulation. This was a political move in the FEHBlog’s opinion because the American Medical Association detests this provision. In any event, the ACA regulators explained that

Until any further guidance is issued, group health plans and health insurance issuers offering group or individual coverage are expected to implement the requirements of PHS Act section 2706(a) using a good faith, reasonable interpretation of the law. For this purpose, to the extent an item or service is a covered benefit under the plan or coverage, and consistent with reasonable medical management techniques specified under the plan with respect to the frequency, method, treatment or setting for an item or service, a plan or issuer shall not discriminate based on a provider’s license or certification, to the extent the provider is acting within the scope of the provider’s license or certification under applicable state law. This provision does not require plans or issuers to accept all types of providers into a network. This provision also does not govern provider reimbursement rates, which may be subject to quality, performance, or market standards and considerations.

The chiropractors danced for joy. But evidently it was not enough for Senate Democrats according to a notice that the ACA regulators posted in the Federal Register today.

The Senate Committee on Appropriations Report dated July 11, 2013 (to accompany S. 1284) 3 states that section 2706 of the PHS Act ‘‘prohibits certain types of health plans and issuers from discriminating against any healthcare provider who is acting within the scope of that provider’s license or certification under applicable State law, when determining networks of care eligible for reimbursement. The goal of this provision is to ensure that patients have the right to access covered health services from the full range of providers licensed and certified in their State. The Committee is therefore concerned that the FAQ document issued by HHS, DOL and the Department of Treasury on April 29,  2013, advises insurers that this nondiscrimination provision allows them to exclude from participation whole categories of providers operating under a State license or certification. In addition, the FAQ advises insurers that section 2706 allows discrimination in the reimbursement rates based on broad ‘market considerations’ rather than the more limited exception cited in the lawfor performance and quality measures. Section 2706 was intended to prohibit exactly these types of discrimination. The Committee believes that insurers should be made aware of their obligation under section 2706 before their health plans begin operating in 2014. The Committee directs HHS to work DOL and the Department of Treasury to correct the FAQ to reflect the law and congressional intent within 30 days of enactment of this act.’’ 

Note to the ACA regulators — this Appropriations bill did not become law. As far as the FEHBlog can tell, this provision is not found in the omnibus appropriations bill that Congress enacted. Hasn’t this law pushed up the cost curve enough. Is it necessary to disrupt up insurers’ provider networks? Do market conditions really not have a role in health care? The comment deadline is June 4, 2014.  This action is unsettling.