Ballot Initiative Pits Providers Against Payers in SD

If passed, a ballot measure in South Dakota will do away with insurance networks as they currently exist, allowing patients to see any doctor willing to see them.

An initiative on the ballot in South Dakota's next month could be a game changer for healthcare providers, patients, and payers. The measure would end restrictions by insurers as to which providers enrollees may choose through a concept known as "any willing provider."

If passed, Initiated Measure 17 would allow any healthcare provider to join an insurance company's network, if the provider agrees to the company's terms and conditions, works within the company's coverage area.

It is supported by a number of medical professional organizations in the state including the South Dakota State Medical Association. "Patients would not be restricted by their insurance plan as to what provider could take care of them," says Mary Milroy, MD, president of the SDSMA. "[Passage] would allow patients and families to continue to see the doctors and medical providers that they know and trust."

Anyone who has had to switch healthcare providers because of a job change or a benefits change will recall the pressure of having to find a new physician and the effort to bring him up to speed on what may be a complex medical history, says Milroy.

"Sometimes, when you switch around too much, you lose that longitudinal picture of comprehensive care," she says.

Straight and Narrow Networks
While narrow networks can offer inexpensive coverage, they aren't always adequate in a state with a small population spread over a large area like South Dakota, says Milroy, reached by phone last week. "I think that this is mainly in reaction to narrow, closed networks."

Given the relatively large size of South Dakota and its sparse population, narrow networks can create a serious obstacle when plan beneficiaries are forced to drive long distances to find in-network providers, says Milroy.

In some cases, patients must take time off from work, drive for hours, and stay in hotels in order to access the medical attention they need.

Narrow Provider Networks Set to Spread

But Brendan Buck, vice president of communications at America's Health Insurance Plans, disagrees that narrow networks have anything to do with IM 17. "What you have here is a number of specialty hospitals that are not interested in seeing lower prices," he says.

"So, they have started this effort. Were a law like this to pass, it would really benefit just a few doctors and a few hospitals, at the expense of really everybody else. I see where [you could associate this measure with narrow networks], but it isn't really a relevant issue. In this specific instance, that isn't the motive."

Patients who are not happy with provider options under their current plans should look into buying new ones, says Buck.

"Consumers have a wide variety of networks to choose from. There are narrower networks that will provide additional cost savings, but, if a consumer wants a broad network or is looking for a particular provider to be in a network, they have the ability to choose from networks that do have that broader network."

Additionally, he says, few people in South Dakota are likely prepared for the cost increases that AHIP predicts moving to an Any Willing Provider policy will cause.

"Plans negotiate on behalf of consumers for lower prices and higher quality doctors for their enrollees. If you put in place a law like the one proposed, it's going to lead to higher prices, which will ultimately lead to higher premiums and lower quality doctors. It's been estimated that the premium increase will be as much as $5,000 over a decade for one South Dakota family."

He also expresses concerns over the quality of physicians if payers are not able to decide who will be in their networks. "We think [this law is] the opposite of what people are looking for."

Conditions for Competition
Milroy insists consumers will not see increased prices as a result of fewer provider networks. "I think that has been [the opposition's] main claim… but we have looked and researched, and we do not see any credible evidence to indicate that."

She points to the 11 states that already have Any Willing Provider laws on the books that have not seen increases in premiums, and to South Dakota's existing Any Willing Pharmacy law. While insurers feared drug prices and copays would increase as a result of allowing patients to go to any pharmacy they wanted, drug prices did not rise, she says.

"On the contrary, what we have seen is an increased competition… we did not see the cost increase that was threatened…. We predict that the same thing will happen [with an Any Willing Provider law]. We disagree with them, and say, 'where's your evidence?'"

South Dakota voters will decide for themselves on the initiated measure on November 4. In the meantime, Milroy says she will continue working for the initiative until Election Day. "I think voters should ask themselves, as a patient, don't you want to be the one choosing your provider, or do you want your insurance company to do it?"