Providers that operate their own health insurance ventures don't mind additional regulatory restrictions on managed-care plans if you pay them and pay them quickly.
At least that's the lesson in Pennsylvania, where hospitals hailed the passage of a bill last week that would dramatically expand regulation of managed-care plans in the state, despite the effect on provider-owned and commercial HMOs alike.
This week Gov. Thomas Ridge is expected to sign the bill, which would become law Jan. 1, 1999.
The biggest payoff for hospitals is a requirement that would speed up payment of claims. Under the law, HMOs would have to pay hospitals within 45 days of receiving clean claims. Violations would run up interest at a rate of 10% annually until the claims were paid.
Tardy claim payments have aggravated hospitals in the state.
In 1997 the average time for an HMO to pay claims was 74.5 days, according to Pennsylvania Insurance Department data compiled by the Hospital and Healthsystem Association of Pennsylvania (See chart). Medicaid HMOs were even worse at 91 days.
In addition the managed-care law would:
Prohibit "gag clauses," or contractual restrictions on what physicians can tell health-plan enrollees about their treatment options.
Mandate a standard under which health plans would pay for emergency care a "prudent layperson" would deem necessary.
Define standards for utilization review.
Standardize provider credentialing.
Implement an appeals process, including external reviews, for denial or cessation of payment for care.
Overall, the bill gave providers most, if not all, of what they sought.
"I think it's a pretty balanced bill," said Carolyn Scanlan, president of the Pennsylvania hospital trade association. The group lobbied hard for the bill, which won support from the usually regulation-averse Republican leadership in both houses.