Last week, The New York Times ran an article announcing a significant healthcare provision in the budget deal reached by Gov. Andrew Cuomo and the state legislature a few days earlier. The story, by Anemona Hartocollis, noted that the deal requires that patients be notified in advance when an out-of-network doctor will be involved in their care. And when patients do get stuck with a surprise bill for out-of-network care, they’ll only have to pay their standard in-network co-payment, with the provider and insurance company going to arbitration to determine how much more the insurer will pay. Benjamin Lawsky, head of the state’s Financial Services Department, explained to Times readers that “the heart of the bill came out of the fact that the No. 1 complaint on health insurance issues we receive year after year is people who get stuck with surprise balance bills.”
So—problem solved, right? These surprise out-of-network bills, which are a driver of personal bankruptcy, are a thing of the past? Well… maybe. The agreement is important, and it’s good that the Times, and a few other New York papers, covered either the deal or the campaign that led up to it. But coverage that framed the rules as a case of well-intentioned public servants and consumer advocates winning a victory for patients told only part of the story. There’s another story here about how interest groups and industry blocs are fighting for leverage, in a battle that has real implications for consumers. And that fight is only going to continue as the budget agreement gets turned into policy during the rulemaking process over the coming months—which means this story is one to keep an eye on.
The backstory is the fight between providers and insurers about how healthcare networks should be defined, which is even more pitched in New York than in the rest of the country. Most private insurance plans offered through the state’s new healthcare exchange offer no coverage at all for out-of-network benefits. Insurers say they can hold premiums down that way—but they also want to gain leverage to force doctors in-network, where insurers can bargain for lower rates. Providers, meanwhile, would like insurers to have to pay something close to the sticker price for out-of-network care, since patients are often unable to pay. And it’s hard for patients with serious medical needs not to get stuck in the middle, because specialists within the same hospital likely won’t all take the same insurance, and neither insurers nor providers want to take responsibility for providing accurate, timely information. “It’s implausible to think that someone can navigate the health system without getting some care from an out-of-network doctor,” says Chuck Bell, the programs director at Consumers Union, which supported the provision.
Coverage like the Times piece and a Gannett article pegged off a Lawsky press conference during the push for the deal, as well as a Newsday editorial arguing in favor of the agreement, all explain why the current system means trouble for consumers. But they don’t really get into the legislative pull and tug between doctors and insurance companies over this measure, and how it maps onto the larger fight about networks. Readers did get a bit of that from the Albany Times Union, in a story by reporter Jordan Carleo-Evangelist. There was even more in the reporting from Laura Nahmias of Capital New York. Her detailed March 25 article outlining the debate before the deal was reached is behind a paywall, but here’s a taste:
Insurance companies say the governor’s plan unfairly benefits doctors, leaving insurers to pay higher rates for anesthesiologists or radiologists, who frequently operate outside of insurance network and can typically bill whatever the market will bear for their services. The insurers argue the state should do more to force specialists into health networks, to help lower the costs of care.
Nahmias and I talked last week about statehouse coverage. Editors sometimes want writers to make an “issue more readable by making it more simplistic than it actually is,” she said.
But in this case, leaving out the sparring between providers and insurers meant telling an incomplete story about why the problem exists—and also about why it’ll important to keep close watch on whether this deal holds up, and how powerful these consumer protections really are, as the fighting over networks, payments, and responsibility for disclosure continues. As Bloomberg’s Caroline Chen noted in a fine piece that broadened the New York dilemma to other states, insurers and providers don’t even agree in principle on who should be responsible for providing updated, accurate information to patients about how far their network extends. And there are circumstances that disclosure can’t address. “When someone’s having a heart attack or a baby, you can tell them someone’s not covered, but can they do anything about it,” Georgetown University professor Kevin Lucia told Bloomberg. The fight over how much doctors get paid, and who pays the bill, in a situation like that is just an extension of how expansive insurance networks should be in the first place.
That means reporters should track the details of the final rules that come out of this agreement, and how special interests continue to try to shape the rules of the new game. They should also follow the effort to require insurers to offer out-of-network, benefits perhaps as an option for consumers willing to pay for them. (Earlier this year Crain’s and Namhias and her Capital New York colleague Dan Goldberg reported on this fight.) Cuomo’s deal has eclipsed the broader out-of-network debate for the moment, but it remains central to how the new forces in the healthcare dictate where New Yorkers get their care.
There are big take-aways from the Empire State’s tale. It brings home the contradictions of consumer choice—good when stakeholders want to grow markets and bad when they when they want to restrict it to keep their customers. It also shows what happens when general news outlets that once might have followed such issues through the legislative process don’t do that any more, leaving the job to specialized news outlets like Capital New York and Bloomberg whose elite readers have a big stake in the outcome.