All insurers in New Jersey must pay for annual physicals for enrollees under a new law that went into effect at the beginning of the year.
The Health Awareness Act, believed to be the first such law in the country, mandates that the state's insurers cover annual physicals for everyone who has health insurance in the state. The law also requires insurers to cover certain tests, including Pap tests, mammograms, immunizations and colon exams, for certain groups of people.
The law is a successor to a resolution passed in the early 1990s that asked insurers to voluntarily cover preventive care and tests. Both sides of the healthcare debate hail preventive care as a way to reduce long-term healthcare costs. But the insurance industry questions whether the law is the right way to achieve that goal and says some of the guidelines regarding when patients should have certain tests are out of date and contrary to national standards.
The added costs of performing what may be unnecessary tests may result in higher premiums, insurers say.
"The problem with this, and the HMOs find themselves in a quandary, is that some of the items in the legislation are outside medical protocol as far as when they should be done," says Dale Florio, spokesperson for the New Jersey Association of Health Plans. "Each plan is looking at the major items in the law to see what they already do and what, in fact, is outdated. That's the problem you run into when the Legislature dictates specifics relative to healthcare."
But patients and physicians faced difficulties getting insurers to cover the physicals and diagnostic tests, says Walter Kahn, M.D., president of the New Jersey Medical Society.
"The problem is many of these insurance companies don't pay for this unless it's written in law," Kahn says. "The other thing is people put these things off, and maybe it's possible that this is another reminder."
The law also creates a three-member health awareness advisory board to review the law's guidelines. Members of the state board won't be paid and must have a background in epidemiology, Kahn says.
"This can actually help the insurance companies," Kahn says. "If we pick (a disease or condition) up early, it can help."
HMOs have always been advocates for preventive care, Florio says.
"The HMOs wrote the book on preventive healthcare and to get people to do whatever they can to avail themselves of those services," Florio says. "HMOs don't have a problem covering these tests. But you've got national standards that (give different testing guidelines). We are focusing on a political problem as opposed to a healthcare one.
"This was under the guise of encouraging physicals," Florio says. "We got carried away (with) listing of specific measures of healthcare when that should have been left up to the regulations or the evolution of healthcare as we know it."
The law requires Pap tests for women over the age of 20 according to a formula, mammograms for women over 35 and colon tests every five years for people over 40.
He says health plans have been trying to reconcile the difference between nationally accepted standards and those mandated by New Jersey law. If they can't comply with the law, the plans may go back and seek changes from the Legislature.
Although Florio says the focus must remain on providing appropriate care, health plans must look at whether premiums need to increase. "You can't dismiss the issue of costs," Florio says.
For the third consecutive year, health plans raised premiums in 2000. And for the second consecutive year, those increases reached into the double digits.
Increases in New Jersey were similar to those around the nation, Florio says. He added that his employees saw premiums jump 32%.