SB 365 of the 1997 legislature authorized the Network Adequacy for Quality Assurance. No appropriation was authorized for the writing of the rules, and so no action was taken on them until the summer of 1999. A rules hearing was held in Helena on August 11, 1999. The Department of Health and Human Services wrote the rules.
The purpose of the bill and the rule is the protection of Montana patients against any potential difficulties arising from the increasing penetration of managed care into the health insurance market in Montana. However, the rules as proposed by the Department do a very poor job at protecting consumers. I believe that the legislature never intended for the law to be construed the way that it has been under the proposed rules.
Writing rules for quality assurance and network adequacy is especially difficult because there are no national models to follow, and, more importantly, because of the exceedingly rural nature of our state. Healthcare providers are often few and far between, and the practice of a physician's assistant in Malta varies considerably from a sophisticated practice in Great Falls. Distances that many Montanans travel for healthcare is considerable already, and stands to be made worse if the current rules are adopted.
The hearing on August 11 was very controversial. The most heated disagreement centered on rules IX and X. Rule IX deals with the distances that people must travel to access healthcare from a participating provider. While that rule was contentious, and the Department eventually did change the proposed rule from 45 miles to 30 miles distance to travel, the real problem lies with Rule X, which virtually guts Rule IX.
Rule X states that the Department may grant exceptions to Rule IX "if good cause exists to do so". Although the Department states, "everyone knows what 'good faith' is," that statement seems rather implausible. In fact, according to Rule X, 'good faith' could mean that if one provider refuses to contract with the health carrier, but another provider has contracted with them, that the carrier has acted in 'good faith' if the offers are similar for similar services. But what of the diversity of facility and function of the providers? In some rural areas of the state the patient mix exceeds more than 70% Medicaid and Medicare, both of which chronically under-reimburse for medical services. Signing contracts that doom them to accepting deeply discounted reimbursement rates from other health carriers is a blow from which such rural providers cannot recover. Also, there was repeated testimony that the process would not be streamlined, but muddled.
One of the most onerous provisions of the rules is that the Department of Health and Human Services would be the judge about whether carriers and physicians were acting in good faith. It is not the function of the Department to interfere in negotiations between providers and carriers. In the long run, it is the patients who are harmed.
These rules, in particular Rule X, are the reason that legislators distrust the rule making authority of various agencies. The executive branch has circumvented the express intent of the legislature and accrued more power to itself by the proposed adoption of these rules.
The Children, Family and Health Human Services Committee has
the power to put these rules on hold until it is satisfied that
the rules as adopted will do what the SB 365 tried to do- make
sure that Montana citizens received the quality healthcare that
we deserve.