Dive Brief:
- Covered California, the California health insurance marketplace, took a role as a healthcare regulator last week by becoming the first Affordable Care Act health exchange to impose quality and cost standards on plans and providers.
- The plan is slated to go into effect over the course of seven years, beginning with the identification of providers offering low-quality or over-priced care by 2018, and excluding them from plan networks as soon as 2019.
- The strategy is similar to employed by HHS, Kaiser Health News notes.
Dive Insight:
The new regulation brings both support and criticism, with some stakeholders concerned that culling any providers from already narrow networks will hurt rather than help patients. Another possibility is that some providers might decline to participate in marketplace plan networks to avoid the new requirements.
Covered California does leave the door open for plans to keep underperforming or overcharging providers if they explain, in writing, the reasoning and how the providers are addressing their issues.
“Covered California’s mission is not just getting patients health insurance; it’s about improving the quality of the healthcare delivery system,” exchange executive Peter V. Lee said in a prepared statement. “We are creating a market that rewards quality over quantity.”
Another top concern is the requirement for transparency around insurers' negotiated rates with providers, which have traditionally been hidden from the public, but which Covered California argues is necessary for patients to effectively compare prices for procedures.
Among the other major provisions: plans are to dock hospitals by at least 6% if they fail to meet specified quality standards and provide equal bonuses for exceeding standards; plans are required to assign patients a primary care physician within 30 days of enrollment; and plans must work with providers to better track and manage patients with chronic health conditions.