California fines top health insurers for overstating Obamacare networks – LA Times

California regulators fined two insurance giants for overstating their Obamacare doctor networks, and said the companies will pay out millions of dollars in refunds to patients.The errors by Blue Shield of California and Anthem Blue Cross caused major frustration for consumers statewide during the rollout of the Affordable Care Act in 2014.The inaccuracies in their provider networks led to big unforeseen medical bills for some patients who unwittingly went out of network for care. The California Department of Managed Health Care said Tuesday that it has levied fines of $350,000 against Blue Shield and $250,000 for Anthem.

Source: California fines top health insurers for overstating Obamacare networks – LA Times

Among the moving parts of the Patient Protection and Affordable Care Act’s health insurance market reforms there are bound to be friction points. One such problematic interface exists between payers and providers participating in California’s health benefit exchange, Covered California, as this report illustrates.

In non-integrated, narrow network health plans like these where payers and providers function as separate entities (unlike integrated care systems like Kaiser Permanente), it’s critical that interface function properly lest it threaten to bring the entire reform mechanism to a grinding halt. Continuing the mechanical metaphor, the narrowness of the provider networks has little tolerance space — and room for error– between the working components. One area where the gears frequently grind in narrow networks is hospital care where the hospitals and physicians are contracted with disparate plans and not necessarily participating in the same plan covering a patient as this Modern Healthcare article explains in detail.


Need a speaker or webinar presenter on the Affordable Care Act and the outlook for health care reform? Contact Pilot Healthcare Strategies Principal Fred Pilot by email or call 530-295-1473. 

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Frederick Pilot

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