The California Medical Association, which represents California’s doctors, opposes a bill that would fine insurance companies for having inaccurate provider networks that lead to confusion in doctor referrals. Photo by Anne Wernikoff for CalMatters.
For many years, licensed therapist Sarah Soroken has received feedback from her patients: mental health Healthcare providers who actually handle insurance. But one patient stands out.
Soroken said that while he was working at Kaiser’s Vallejo Medical Center in 2022, a college-aged woman attempted suicide and was rushed to the hospital’s emergency room. Soroken said the patient called a list of 50 mental health providers listed as accepting Kaiser’s insurance plan, but none would see her or actually accept her insurance, so she gave up and attempted suicide.
“This patient is now dealing with the trauma of a suicide attempt and is in even greater need of treatment from the health care system.” Soroken told the Senate Health Committee. Earlier this month.
Soroken, who does not work for Kaiser, is a former Democratic lawmaker for Rep. Chris Holden. Assembly Bill 236The Pasadena Democrat’s bill would give state regulators the power to fine insurers if their lists of in-network doctors, hospitals, mental health workers, labs and imaging centers aren’t up-to-date and accurate.
The bill, which would address what are disparagingly called “ghost networks,” has so far advanced through both the House and Senate health committees, despite powerful lobbying groups representing California doctors and insurers opposing the bill at every stage. Doctors and insurers have blamed each other for the directory problem, arguing that the bill is unnecessary, too burdensome for them, and that existing law already addresses the issue.
These groups have collectively donated at least $4.7 million to California lawmakers since 2015. Digital Democracy Database.
State health officials point to huge costs
The bill faced opposition from powerful lobbyists for doctors and insurance companies, as well as a lukewarm response from state officials who would enforce the bill if it passed.
The state legislature and Governor Gavin Newsom This year’s budget deficit is $30 billionThe Agency for Health Care Administration estimates the bill would cost $12 million to hire “additional staff.” The new staff would be needed to write rules and paperwork and monitor “the accuracy of the provider directory,” according to an analysis of the bill.
The estimated $12 million equates to 80 employees making $150,000 a year, a figure that could surprise Newsom’s budget team and lawmakers who will distribute the cash to state agencies when the bill goes before the Senate Appropriations Committee in the coming weeks.
The department did not respond to a CalMatters request for clarification on the estimates, and in a one-paragraph emailed statement, department spokesman Kevin Dulawar said the estimates may be out of date because the bill was recently amended.
“The ministry is considering the amendments to the bill and how they will impact the fiscal estimates,” Dhulaawa said.
Rep. Ken Cooley, a Democrat from Sacramento County who once served on the House Insurance Committee, said he wasn’t surprised the Department of Insurance “furiously” analyzed the bill and may have overestimated the costs. “If they don’t like it or they think it’s the wrong priority, they’d be remiss not to try to make every argument, whatever that may be,” he said.
But Cooley said fixing the problem of inaccurate provider listings is worth fighting for.
“I’m not familiar with the specific bill, but I certainly understand what it means to be a health care consumer,” he said, “and having an accurate list is really, really important to people’s health.”
Why “ghost networks” are a problem
Holden, the bill’s author, did not respond to multiple requests for an interview. He told the Senate Health Committee: A law in place since 2015 requires insurers to maintain accurate directories of the medical providers in their networks, but insurers have not done so, leading to “pervasive directory inaccuracies,” the report said.
His office told lawmakers that a recent survey found that some smaller health plans had inaccurate information about up to 80 percent of their providers, while some larger health plans had inaccurate information about 20 to 38 percent of their providers.
Holden’s bill would require insurers’ provider directories to be at least 60% accurate by this time next year, and 95% by July 1, 2028. Insurers could be fined up to $10,000 for every 1,000 registered customers each year if they don’t meet the standards. For example, Kaiser says It provides health care to 9.4 million Californians.
The bill also provides that patients who mistakenly use an out-of-network doctor due to inaccurate information on their provider listings cannot be billed for out-of-network fees.
Doctors and insurance companies oppose the bill
At a Senate Health Committee meeting earlier this month, insurers complained about the proposal, arguing that doctors were to blame for inaccurate provider lists.
“The accuracy of each provider directory relies on physicians and medical groups maintaining accurate records,” said Jed Hampton, a lobbyist for the California Health Insurance Association. He told the committee.
A bill under consideration in the California Assembly would require insurers to provide customers with an accurate list of in-network providers, including hospitals, for referrals. Photo by Larry Valenzuela, CalMatters/CatchLight Local. Photo by Larry Valenzuela, CalMatters/CatchLight Local
The California Medical Association, which represents doctors in the state, argues that insurance companies, not doctors, are responsible for maintaining and keeping lists up to date. Doctors worry that if insurers are fined, the costs will be passed on to them. They also worry that insurers providing inaccurate lists could result in lost payments for out-of-network care.
Brandon Murchie, a lobbyist for the group, said: Those who said This requirement would exempt health plans from the obligation to maintain an accurate directory by not paying out-of-network charges.
Soroken, the therapist who treated Kaiser patients who were suicidal, said Californians pay insurers and health care providers enough, and they have a right to have accurate, up-to-date lists of people who will accept their insurance, especially when they are at their most vulnerable, she said.
“We would be remiss if we didn’t do everything in our power to ensure patients get the medical care they need and are legally entitled to.” She said.
Kaiser has not taken a position on the bill, and a spokesman declined to comment on Soroken’s testimony about patients who attempted suicide.
Auckland-based healthcare giant Already being scrutinized The company has been hit by complaints from patients about delays in receiving mental health care. Last year, it agreed to pay $200 million to resolve a state investigation into its behavioral health system. In 2022, it plans to cut payments to about 2,000 of its employees. Mental health workers They went on strike due to the high caseload and what they said were unreasonable working conditions.
“At Kaiser Permanente, we work hard to ensure we can meet the mental health care needs of our members and communities,” Kaiser spokeswoman Kelly Reedy said in an email. “Over the past few years, we have expanded our staff and facilities to meet the growing need.”
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Calm Matters is a nonprofit, nonpartisan media venture explaining California policy and politics.
