Executive office update: Monopoly, oligopoly, monopsony – the new board game for doctors

Tuesday, March 01, 2016 12:05 PM

by Alfred Gilchrist, CEO, Colorado Medical Society

Hopefully you caught the subtle imagery on the cover and have browsed the range of commentaries, including from Aetna and Anthem, on the proposed consolidation of four of the five largest commercial insurance companies in America. You will find the cover story’s analysis of a recent all-member CMS survey and a sample of the verbatim physician responses included with the charts both compelling and alarming. Among the health care policy priorities on our agenda, the patient-centered clinical and economic concerns of physicians will remain a singular priority of CMS along with the liability and professional review environment. We will continue to pursue policy shifts that assure competition over the value of care, not market-share or cost irrespective of that value.

Pursuing these policy shifts will be a grind. There will be no “a-ha” moments and no battlefield epiphanies. The business motives of these companies are structurally in conflict with the clinical motives of physicians. Current and potential imbalances given the proposed mergers in the economic relationships between these companies and physicians are not only unfair, they can be dangerous. The transactions directly involve human lives and their health.

There is no definitive endgame when attempting to set policy guidelines on the size, operations and business relationships between physicians and these proposed leviathans. The process is inherently political. Developing and enacting legislative and regulatory language is complex and urgently needed to reset boundaries. Despite the urgency, this is a long game with recurring adjustments as all the parties involved adapt and evolve to new policy and business model changes over multiple iterations and time.

Our mediation with Colorado Association of Health Plans (CAHP) ended without resolution on out of network (OON) or the many network issues we surfaced. Complex problems demand collaboration, and we intend to continue a constructive dialogue with CAHP and any individual company that is interested. In the short term, the conversation over the next 60 days moves without much, if any, dialogue into the legislative branch and a network adequacy stakeholder process hosted by the Division of Insurance. We are reasonably certain that some, though not all, of the companies will use their considerable influence to make certain nothing substantive comes from this agency endeavor or out of the legislative branch this year.

We had a conversation with the commissioner of insurance and the executive director of the Department of Regulatory Agencies (DORA) in late February. The meeting was of course civil (this is Colorado, not Texas) and the net of our message was straightforward, demonstrating our strongly held resolve and commitment. The network adequacy laws have not been meaningfully updated in almost 20 years while the marketplace has changed dramatically. The two agency heads spoke encouragingly of a strong partnership with physicians.

There are numerous ongoing reasons to engage the companies as well as legislators and regulators over the next year. In addition to the DOI stakeholder process on network adequacy, DOI hearings on the proposed Anthem-Cigna merger and upcoming legislation in 2017, DORA will be conducting a “sunset review” of DOI, which should attract considerable stakeholder attention to the agency’s role as overseer and referee in these complex relationships. This is indeed a target-rich environment.

CMS Board of Directors votes to strongly oppose Aetna/Humana and Anthem/Cigna mergers

At its March 11, 2016 meeting, the Colorado Medical Society board voted to strongly oppose the proposed health plan mergers due to the following:

• Overwhelming opposition to the mergers expressed by physician members through the statewide survey on the subject;
• Lack of transparency by the Division of Insurance surrounding the process and information used to evaluate the mergers, and the demonstrated unwillingness to receive input from principal stakeholders including physicians and patients;
• AMA analysis of Colorado metropolitan statistical areas (MSAs) that demonstrates a current, significant anticompetitive health insurance marketplace in many MSAs that these mergers will only augment;
• Ongoing and aggressive development by health plans of narrow provider networks that limit access to care and physician choice with little to no transparency about the standards used to create and maintain these networks.