DMHC Faults Blues On Their Networks
A state regulator concluded that two of the state's largest health insurers misled consumers who purchased their plans through the Covered California health insurance exchange.
In a blunt assessment of Anthem Blue Cross of California and Blue Shield of California, the Department of Managed Health Care concluded that both plans did not provide accurate rosters of physicians and other providers to those state residents who purchased coverage during the exchange's open enrollment period between last fall and early 2014. The two plans cover about 58% of those consumers who purchased coverage through Covered California during the 2013-14 open enrollment period.
The DMHC concducted the audits last June after being prompted by consumer complaints that they were having trouble finding physicians in the Anthem Blue Cross and Blue Shield networks to provide them care. An advocacy group, Santa Monica-based Consumer Watchdog, had also filed suit against the plans, alleging fraud.
According to the agency's audit of Anthem Blue Cross, which had enrolled about 425,000 lives through Covered California, 12.5% of the physicians listed in its directory were not at their published location, and 12.8% “were not willing to accept patients enrolled in the Plan’s Covered California products, despite being listed on the website as doing so,” the 43-page audit concluded.
For Blue Shield, 18.2% of the providers were not at the location as stated in the directory, and 8.8% were not willing to accept patients enrolled in Covered California even though it appeared to patients otherwise.
Under state law, the plans are required to notify the DMHC if 10% or more of their network is at variance with notices that had been filed with the agency.
“The surveys identified inaccuracies in both Anthem Blue Cross and Blue Shield of California’s online provider directories, which limited enrollees’ access to care and resulted in an unacceptable consumer experience,” DMHC spokesperson Rodger Butler said in an email.
Both insurers had mostly denied that was the case, and any glitches were the result of the confusions and mixups inevitable in the launch of something as ambitious as the federal Affordable Care Act.
The DMHC found four major deficiencies for the plans, including having inaccurate information in its online provider directories; the dissemination of inaccurate statements that consumers relied on for the purpose of plan enrollment; failure to provide accurate provider lists to consumers; and not submitting updated provider lists to the agency for its approval. According to the surveys, which were completed earlier this month, none of the deficiencies had yet to be corrected.
The DMHC also concluded that both Anthem Blue Cross and Blue Shield enrollees were subject to out-of-network charges even though they thought they were using in-network providers.
Due to the seriousness of the deficiencies, Butler said that the infractions had been referred to the DMHC's enforcement office for additional corrective actions, which could include hefty fines. He added that the DMHC will initiate follow-up surveys next spring to ensure that the deficiencies had been corrected.
In a statement, the San Francisco-based Blue Shield, which signed up nearly 382,000 lives through Covered California, contended that the DMHC report was misleading and relied on a flawed methodology and too small a sample of enrollees. The agency had called more than 5,700 doctors' offices for the Anthem Blue Cross survey, but did not disclose how many calls were made to verify Blue Shield participation.
“The Department’s report exaggerates the severity of the issues and understates the extent of our corrections,” the insurer said. “The vast majority of the issues raised in the Department’s report have either been corrected by Blue Shield or were never caused
by Blue Shield in the first place.”
Yet Blue Shield also said that it had cleaned up its act. “(We have) undertaken a comprehensive effort to address member confusion about providers, which should lead to a much improved 2015 experience. Our provider directories have been updated, and we are intently focused on maintaining their accuracy through continuous updates, educational outreach for providers and staff, and technological enhancements to our systems.”
Blue Cross took a similar tack, saying it was improving the accuracy of its provider directory, but also claiming the DMHC overstated the issue.
“We reviewed the contracts of all those who told the D<HC that they weren't taking Anthem members. Out of those, literally 99% had contracts with Anthem, and only 1% was in error,” said spokesperson Darrel Ng.
Consumer Watchdog, which had sued Anthem Blue Cross and Blue Shield last year, claiming that their practicies had amounted to a bait-and-switch expressed hope that the regulatory actions were a wakeup call to the health plans.
"We're hopeful that Blue Shield and Blue Cross will quickly resolve these lawsuits and reimburse consumers for the out-of-pocket payments they were required to make to physicians who they were led believe were part of their plan," said Jerry Flanagan, a Consumer Watchdog staff attorney. Flanagan also urged the DMHC investigate Cigna, claiming it also had major discrepancies in its published and available provider networks.
