NY Settlement on Out-of-Network Charges & Government Price Fixing
By: John R. Graham
10.28.2009
Yesterday, NY Attorney General Andrew Cuomo made a big announcement pursuant to his settlement with health insurers about their use of Ingenix (a data vendor) to calculate usual & customary rates (UCR) for reimbursing patients who use out-of-network providers. As I noted in January, preventing health insurers from using a private vendor to calculate UCRs, and imposing a government-chartered monopolist instead, gives the state great power to fix prices for the purpose of controlling Americans’ access to medical services. Folks who follow that previous thread will note that I am not a fan of the way insurers calculated UCRs, but that’s not because I think there’s a conflict of interest in their doing so. Rather, it’s because I think the whole network model is absurd, and an artefact of the government artifically favoring group versus individual ownership of health insurance. Nevertheless, as Mr. Cuomo noted in his presentation (at 17′47″ on the video), 70% of Americans have plans that allow them to go out of network. So, something must be working for this model to persist. Mr. Cuomo has established his health-care pricing database monopolist at Syracuse University, which is thrilled to have control of $100 million to establish its new non-profit business, which it calls FAIRHealth. Within a year, Ingenix will be out of this business, and FAIRHealth will be providing UCRs to the health-care sector and the public. (The NY Insurance Department has drafted a regulation to support Mr. Cuomo’s intent.) I’m sure that there are many unintended consequences to this significant step, which I have not yet figured out. But core fact is this: Every claim for medical services in New York (and, Mr. Cuomo hopes, the nation) will soon be monitored and controlled by a non-profit monopolist appointed by the Attorney-General of New York. This blog post originally appeared on StateHouseCall.org.
|
