Jim LeBuhn, a senior director and analyst of not-for-profit healthcare, agreed. “I think providers have been pretty satisfied with the rates they've been able negotiate.”
But in the case of health plans that have restricted provider networks to one health system, providers in those plans often have agreed to lower rates. Health plans that limit patient choice through such narrow networks are expected to offset the lower rate with more patient volume.
How much more volume will depend on how many Americans sign up for coverage through the exchanges, the heart of the Patient Protection and Affordable Care Act's insurance expansion. That likely won't be clear until December, when consumers face a deadline to buy coverage effective Jan. 1.
Catholic Health Initiatives, which operates across 16 states, agreed to reduce rates by 5% to 10% in narrow-network health plans on the exchanges, said Juan Serrano, senior vice president of strategy and operations with the Englewood, Colo.-based system. The system entered into four narrow-network plans. Insurance companies' early bids sought steep discounts without establishing narrow networks, which Serrano described as “doesn't hurt to ask” proposals. The health system refused and negotiated higher rates.
CHI officials anticipate that some exchange customers may be people formerly insured through an employer plan paying higher rates rather than previously uninsured people.
WellStar Health System, based in Marietta, Ga., entered into talks and found that some insurers were unwilling to budge on demands for deep discounts, said Jim Budzinski, the five-hospital system's executive vice president and chief financial officer. “There wasn't a lot of discussion,” he said. “It was like, take it or leave it.”