If a new bill passes in Tennessee, it will mean that health care providers will play a role in rates negotiations.
A new bill is currently under consideration by the Tennessee state legislature, which would alter the way insurance companies currently calculate the rates that are charged through doctors’ offices.
The Healthcare Providers Stability Act will be the first of its kind for any state in the country.
The current issue that the bill would change is that at the moment, insurance companies have the ability to change the rates charged for healthcare services through providers. They can change these amounts at any time and by any amount. Dr. Doug Springer is currently drawing up his annual budget. This former Tennessee Medical Association president will need to sign a contract with insurers for rates negotiations as a part of this budget-setting process. However, this effort is made much more challenging as a result of the fact that the game could change at any time if insurance rates are altered in any direction and by any amount.
According to Dr. Springer, over the span of a single year contract, insurance companies may change rates dozens of times.
“A one year contract can change 10, 20 – 30 times a year,” he said. He also pointed out that many of the administrative guidelines within the contracts that doctors must sign with insurers are not entirely clear, but they do place the rates solely in the hands of the insurance provider. Moreover, when a change is made, there isn’t anything that the doctor can do about it, including when an insurer cuts the amount that the healthcare provider will make from having provided a medical service.
Dr. Springer explained that “It affects our business as far as paying our bills, hiring and anything that we try to do strategically.”
The Tennessee bill was written in response to this situation. It was co-written by state Rep. Jon Lundberg in the hopes of addressing the issue and to place more power in the hands of the medical providers.
The current writing of the Healthcare Providers Stability Act states that “if an insurance company wants to change their reimbursement, they can do that, but they can only do that twice a year and giving notice 90 days in advance.”