Check The Fine Print: Some Work-Based Health Plans Exclude Outpatient Surgeries
By Jay Hancock
Kaiser Health News, January 25, 2016
Last year regulators blocked companies with millions of lower-wage workers from claiming that coverage with no inpatient hospital benefits met Obamacare’s strictest standard for large employers.
Now that those so-called “skinny plans” aren’t allowed, insurance administrators and many cost-conscious employers are purporting to meet the rules with a new version that excludes another major category: outpatient surgery. The new plans may not survive regulatory scrutiny any more than the old ones did, some experts believe.
For 2016, such insurance has been marketed primarily to staffing companies, home health agencies, hoteliers and other lower-wage employers that had historically never provided major medical coverage. Those are the same firms that were sponsoring skinny coverage a year ago, industry consultants say.
“I really wonder whether they can do that,” said Timothy Jost, a law professor at Washington and Lee University in Virginia who is an authority on the health law. “Refusing to cover any outpatient physician surgical services is arguably a violation.”
Unlike insurance sold to individuals and small businesses through online marketplaces, large employers are not required to offer a list of “essential health benefits.” Instead, they must offer minimum value — roughly comparable to that of a high-deductible, “bronze” marketplace plan — as determined by an online calculator and regulatory guidance, or face a penalty. There is also a lesser standard for large employers — “minimum essential coverage” — that triggers different fines for noncompliance. But nearly all workplace-based plans that offer some types of preventive care meet this requirement.
By Don McCanne, M.D.
One of the arguments made for choosing the incremental policies of the Affordable Care Act (ACA) over a comprehensive single payer model of reform was that the politicians wanted to avoid disrupting the part of health care financing that was working well – particularly the employer-sponsored health plans. So are employees being assured of adequate health care coverage?
The onslaught of higher deductibles and narrower networks indicates that maybe these plans are not working so well after all. But you cannot underestimate the conniving behavior of some of the private sector employers in shirking their responsibilities for providing adequate coverage, as supposedly was intended by the architects of ACA.
Since the employers are allowed considerable flexibility in plan design, some thought that they could exclude inpatient hospital benefits. That, of course, would be disastrous for anyone requiring hospitalization. Fortunately that loophole was closed.
Now they claim that they can exclude outpatient surgery. Considering that now about two-thirds of surgeries are done on an outpatient basis, that too will lead to financial disaster for far too many patients. It is likely that our federal stewards will also disallow the exclusion of outpatient surgery. But then what scheme will they think up next?
Leaving the private sector in control inevitably leads to devious behavior designed to save money for the employers or insurers at a cost to the patients. That is the way the private sector and their markets work. In contrast, responsible public stewards act in the interests of patients, and part of that means ensuring an adequate health delivery infrastructure to take care of the patients.
We really do need to dismiss private managers of health care funds and replace them with our own public administrators. That’s precisely what a single payer national health program would do.