AMCNO Provides Comments on HB 125 to Senate Committee

HB 125, the Healthcare Simplification Act was intended to provide remedies for many of the excessive administrative demands faced by doctors in their interactions with health plans. The bill passed the House by a vote of 91-5 and is now in the Senate, however, it has been changed so many times it is now in its seventh version. The AMCNO, although still supportive of the intent of the bill, has some reservations about the latest version and we have sent comments on the Substitute Bill to the Chairman of the Senate Judiciary and Civil Justice Committee. Our comments noted in part “the AMCNO has a longstanding history of supporting legislation that would eliminate the “red tape” that physicians encounter when dealing with health care insurance companies. In fact, the AMCNO spearheaded legislation in the past in Ohio that had intended to allow physicians to negotiate with health insurance companies. Our proposed legislation would have allowed independent physicians and other health care providers to join together to negotiate non-fee-related contract terms with insurers, including, but not limited to: definition of medical necessity, utilization review criteria and procedures; preventive care and medical management policies; patient referral standards and procedures; drug formularies; quality assurance programs; liability issues; payment methods and timing; claim documentation requirements and administrative procedures; credentialing standards and procedures; dispute resolution mechanisms and all products clauses.” 

The AMCNO also noted that although HB 125 differs somewhat from our previous legislation concept, it does provide for items that the AMCNO and our 4,400 physician members have advocated for in the past – such as standardized credentialing, restricting a health care contract from including certain provisions such as an “all products clause,” providing for appropriate dispute resolution, disclosure of payment methods/terms by insurance companies and transparency in health insurance contracting. 

Our comments continued by stating that the AMCNO is concerned, however, that the legislation does not go far enough in that the insurance companies are not completely prohibited from using an all products clause, and that the bill does not completely prohibit insurers from including a most favored nation clause in contracts. Instead, at the present time the latest version of the bill calls for a two-year moratorium on the usage of a most favored nation clause while a joint legislative review committee reviews the matter, and the bill would “restrict” the use of all products clauses. Other states have already prohibited the use of such clauses and we feel that Ohio should follow suit. In addition the Department of Justice has begun to investigate the use of these clauses in the insurance field. These clauses are unfair and would never be allowed in other business practices.

The AMCNO would also have preferred that language were included in this bill that addressed the definition of what constitutes “medical necessity.” Often insurance companies make decisions relative to medical necessity matters that are inappropriate and not in the best interest of patients. Insurance companies routinely deny access to benefits guaranteed by their contracts, and this denial of payment for medical care can result in a patient receiving inadequate or delayed treatment. Physicians should be in control of what is deemed medically necessary for a patient – not an insurance company. The AMCNO would favor inclusion of a definition of medical necessity in this legislation along with consideration of the legislature requesting that the Ohio Department of Insurance create a healthcare panel inclusive of physician representation that would review and comment on health insurance company practices. 

Finally, the AMCNO is still a proponent of allowing physicians to jointly negotiate with insurance companies with regard to their contracts. Without the ability to jointly negotiate it will be continue to be difficult for physicians to have any real impact in their negotiations with the large insurance companies in Ohio.

The AMCNO continues to advocate for passage of HB 125, however, if there were an opportunity to revise the legislation to include some of the points outlined above, the legislation would be much stronger and have a greater impact on e physicians and their practice. For more information on this legislation or to obtain a complete copy of the AMCNO letter to the Senate committee, please contact E. Biddlestone at the AMCNO offices at 216-520-1000, ext. 100.