SB 198: Compromise talks scheduled this summer

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In light of a veto from Gov. Bill Owens, doctors at Colorado Medical Society say they have no choice but to continue fighting for more transparent contracts with health insurance plans.
“We were very disappointed,” said Dr. Rick May, president of the society. “We put in a lot of effort drafting this bill and getting broad bipartisan support in the House and Senate.”
In vetoing the bill, Owens said “… S.B. 198 creates an unnecessary intrusion by the government into contracts between private parties. The bill dictates contract terms, and wrongly places these mandates into the consumer protection code.”
S.B. 198 was designed to allow standardized contracts between doctors and health insurance providers, creating a transparent form to replace the contracts used by separate insurance companies. Currently, doctors receive no fee schedule from insurers, and must sign up for every product offered by a health plan.
“The issues this bill addresses aren’t going away,” May said. “They continue to be a real burden. We need to find some way to address these issues.”
Overriding the veto is not realistic, May said. Because the legislative session ended, a special session would need to be called. So, the Colorado Medical Society is focusing on a two-prong approach: continued talks with health insurance plans and approaching the legislature next session – when Owens is no longer governor.
“We’re going to take this time between the sessions to continue our talks with the health plans,” said CMS president-elect Lynn Parry. “It’s our opinion that if we can work something out without legislation, that’s always better. We’ll continue to work on these issues that are important for doctors throughout the legislative recess. But we won’t rule out going back to the legislature. That’s our current plan.”
Mike Huotari, executive director of the Colorado Association of Health Plans, said he is pleased with the governor’s decision to veto the bill. However, he hopes discussions will create solutions to the doctors’ problems.
“I think we have a chance to come up with some compromises, we plan to continue the dialogue we started,” he said. “We’ve spent 40-plus hours with the doctors and the medical society. I think we have a better appreciation of issues on both sides. I hope, and expect, that we’ll continue the discussions.”
Both Parry and May said the CMS has a good working relationship with local representatives of national health care plans. Several meetings are scheduled this summer with those representatives, to try to iron out issues with health care contracts.
Even in his veto statement, Owens acknowledged that the doctors’ concerns are valid.
“Accordingly, my staff drafted two amendments that would have largely addressed these issues with the hope of reaching a compromise with opponents and proponents. The first proposal created a template for contracts that would have helped ease administrative burdens. The second addressed two central points of contention by requiring the disclosure of fee schedules and material contract changes.”
May said Owens was merely responding to pressure from national health care plans.
“He listened to the concerns, pressure from those national corporations,” he said. “The governor decided to side with them, as opposed to small business people who are the physicians in Colorado.”
The issue SB 198 was designed to address was transparency in the contract process.
“Currently, health care providers – not just physicians, but nurses and technicians – get contracts with the terms referenced, but not specified,” Parry said. “For instance, they’ll say the terms are spelled out in the providers’ manual, but you don’t have a copy of the manual. Or, they will reference how they decide your fee, a certain percentage of a certain rate. But when you ask what the rate is, they say it’s proprietary. You have no way of figuring out what you’ll be paid, or of comparing contracts.”
Health care providers sign not just a few contracts, she said, but frequently as many as 15, even at small practices. For doctors operating small businesses, hiring attorneys to sort through the legalese can be cost-prohibitive, she said.
“More than 50 percent of doctors are small businesses,” she said. “Just one or two doctors. The time and overhead incurred trying to find out exactly what you are agreeing to is so expensive. This simply is one way of making the process transparent, of creating simple, direct language.”
For his part, Huotari hopes a solution can be reached without regulations or legislation.
“The issues are operational, part of the business process,” he said. “Issues like prior notice don’t lend themselves to a legislative solution. It’s a big hammer to solve something. The best way is to compromise, to see both sides of the issue and to bring good will and sincerity to work out the problems.”