New health insurance rules strengthen provider networks

Medical Provider Network Adequacy Regulations strengthen consumers’ access to timely health care

Inaccurate provider lists, insufficient access to doctors and hospitals, and surprise bills are all addressed by new regulations

SACRAMENTO, Calif. — Permanent regulations issued by California Insurance Commissioner Dave Jones establishing stronger requirements for health insurers to create and maintain adequate medical provider networks were approved by the Office of Administrative Law (OAL). These regulations go into effect immediately because they address a number of critical problems consumers have faced with insurers when seeking timely access to care. Commissioner Jones issued emergency regulations at his inauguration ceremony on January 5, 2015, which have been in effect since late January 2015, but with OAL’s approval, the new network adequacy regulations are now permanent, and go into effect immediately to help consumers who have been facing issues with access to medical care.

Designed to improve access to medical care, the regulations require health insurers to offer sufficient numbers and types of health care providers and facilities in their provider networks so that consumers with health insurance can get the timely care they need.

“Health insurers are required to develop and maintain medical provider networks with sufficient numbers of medical providers and facilities to meet the needs of their policyholders and provide accurate information about which doctors and facilities are in their networks,” said Commissioner Jones. “These new regulations provide consumer protections that should prevent the practice of surprising consumers with huge charges for out-of-network providers when they sought out an in-network provider.”

Many insurers have “narrowed” their medical provider networks, reducing the number of medical providers including specialists. Insurers also provided inaccurate information to consumers in their provider network directories, which consumers relied upon in seeking medical care. These practices can hurt consumers by delaying medical treatment and increasing out-of-pocket costs ­including surprise, and often expensive, medical bills for treatment provided by out-of-network medical providers despite consumers’ best efforts to make sure care is provided by in-network providers.

To address rising concerns about network adequacy, the commissioner’s new regulations strengthen and add new health care provider network requirements, including requiring health insurers to:

• Include sufficient numbers and types of providers in the network to deliver covered services;
• Adequately provide for the treatment of mental health and substance use disorders;
• Include an adequate number of primary care providers and specialists with admitting and practice privileges at network hospitals;
• Monitor and adhere to new appointment wait time standards;
• Regularly report information about the networks and changes to the networks to the Department of Insurance for review;
• Maintain accurate provider network directories available to the public and update them weekly; and
• Arrange out-of-network care at in-network prices when there are insufficient in-network care providers.

*The new regulations only apply to health insurance plans regulated by the California Department of Insurance. Most of the individual and family plans offered through Covered California are regulated by the Department of Managed Health Care.