Agents Caught In Middle On Texas Health Plan Fines
The Texas Department of Insurance recently imposed $9.25 million in fines and millions of dollars in restitution payments to punish managed care companies for violating a state law requiring prompt payment of health claims.
The department hit 17 plans controlled by seven parent companies.
Health insurance agents interviewed say they have mixed emotions about the fines: they agree that regulators should act if carriers really are failing to pay health claims promptly, but they would like to see regulators avoid depending on fines.
“The managed care environment is not exactly overflowing with cash reserves right now,” says Gary Looney, a health insurance broker at Catto & Catto, San Antonio.
Besides, agents say, most of the claims problems they handle turn out to be the result of an error by a patient or a doctors office.
“Many times, medical offices send a claim just to get it out the door,” says Becky Parker, an agent at Nieman Hanks Puryear Benefits L.L.C., Austin.
The real Texas payment conflict is not over delays on individual claims, but delays in payments to group practices and other organizations that manage claims for many doctors, Looney says.
Texas Gov. Rick Perry recently vetoed H.B. 1862, a bill that would have established a tougher prompt-payment law, partly on the grounds that Texas regulators already had the authority they needed to fight payment delays.
Regulators may have felt they had to crack down hard to justify the veto, according to Shirley Hutzler, the lobbyist for the Texas Association of Health Underwriters, Duncanville.
So far, Texas regulators have not given any estimates on the size of the restitution payments they want carriers to make to providers affected by payment delays.
The Texas Association of Health Plans, Austin, Texas, says providers should work harder to resolve any payment problems outside of an “environment of open conflict.”
The prompt-payment fines are “ultimately going to be paid by businesses and consumers,” warns Tom Lucksinger, president of the health plan association.
Doctors themselves could help reduce turnaround times simply by persuading more of their colleagues to use electronic claims systems, the plan association argues.
The companies hit with fines are: Health Care Service Corp., Chicago, (the parent company of Blue Cross and Blue Shield of Texas); CIGNA Corp., Hartford; Great-West Life & Annuity Insurance Company, Denver; Sierra Health Services Inc., Las Vegas; WellPoint Health Networks Inc., Thousand Oaks, Calif.; Humana Inc., Louisville, Ky.; and UnitedHealth Group Inc., Minnetonka, Minn.
Texas regulators say they are still talking to Aetna Inc., Hartford, and PacifiCare Health Systems Inc., Santa Ana, Calif.
Reproduced from National Underwriter Life & Health/Financial Services Edition, August 27, 2001. Copyright 2001 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.