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Will Physicians Be Dropped From Managed Care Networks?

Greg Freeman, January 22, 2014

Given the mandates of the ACA-including the Essential Health Benefits package, elimination of preexisting conditions as an underwriting mechanism, and narrowing of community rating bands-insurers have few options available to rein in the cost of these new exchange products, Osowski says. Unfortunately, these limited options include reducing reimbursement to providers of healthcare services and eliminating "high-cost" providers from the plan's network.

"The consequences of these actions are generally negative for both providers and consumers. Consumers will be faced with untenable choices of changing their doctor or hospital to remain in network or paying significant sums from their own pocket to continue seeing their doctor of preference," he says. "And while robust networks may still be the norm in large commercial products, providers of healthcare services have the difficult choice of either accepting greatly reduced reimbursement for services if they choose to participate in the narrow networks or losing access to their patients."

Physicians may still receive discontinuation letters for some time, says Jodi B. Laurence, JD, a health law attorney with the Florida Health Law Center in Davie, Fla. The terminations are being driven by the continuing consolidation in the marketplace, she explains.

"In all network contracts there is a 'termination without cause' provision, meaning they can terminate on 60 days' notice," she says. "You may have been in this network for years and you were making a good living, the insurer was happy with your services, and then you can still be terminated. When that happens, there is really very little you can do."

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4 comments on "Will Physicians Be Dropped From Managed Care Networks?"


F.H. Netter (2/17/2014 at 4:42 PM)
This is just one more reason the for-profit health insurance system must go. We need single payer and we need it yesterday.

Barbara Ryan (1/23/2014 at 8:09 PM)
Insurers only have to "rein in costs" in order to maintain (or grow) their profit margins. Insurers have been decreasing payments to providers while increasing charges to those they insure for a long time. Obamacare is only the tip of the iceberg of making medical care accessible and affordable[INVALID]insurance industry reform and regulation is also critical.

Doyle (1/23/2014 at 4:48 PM)
Looks like some high quality physicians will draw the higher income patients. Ones that can afford out of network fees. That would be different