DFS Calls for Hearing on Anthem-Cigna Merger

Gavel-CreativeCommons

Late last week, the New York State Department of Financial Services (DFS) called for a hearing to discuss the consequences of a merger of the Anthem and Cigna health insurance companies. HCFANY applauds DFS for this action. HCFANY wrote to DFS in early March shortly after the potential merger was announced. In the letter, HCFANY urged the Department to carefully review this merger and hold a public hearing on how it affects competition in the state Marketplace, which ultimately impacts the costs of premiums and quality of care for consumers.

This merger would combine the second-largest and fourth-largest health insurers in the country and reduce the number of major health insurers in the U.S. from five to three. According to a recent article in Politico, this would mean that Anthem’s total market share would increase to 31 percent in New York State. In the New York Metropolitan area, Anthem would control almost 70 percent of the commercial self-insured market in three of the five boroughs. Increased market share would give Anthem the ability to dictate prices for providers and likely have a negative impact on access to health care for New York’s consumers.

If you would like to weigh in on the proposed Anthem-Cigna merger, there will be a public hearing held on Thursday, September 8 at 10:00 AM in New York City. If you are interested in testifying at the hearing, please write to DFS at New York State Department of Financial Services, Public Affairs Office – Anthem-Cigna Merger New York, NY 10004 OR e-mail public-hearings@dfs.ny.gov with the subject line: “ANTHEM-CIGNA 2016 HEARING.” Requests to testify must be received at least five business days prior to the hearing.

failed-paper-mdFor the fourth year in a row, New York State received an “F” in an annual report on price transparency when paying for health care. The grades are published every year by the Catalyst for Payment Reform (CPR), an organization that wants to improve health care by changing how it is paid for.

Part of changing health care is giving consumers accurate price information so they can choose affordable providers. We’ve written before about how hard it is for consumers to get information about prices from New York’s hospitals. As the authors of this new report say, getting the price of a service before receiving it is “the very minimum amount of information a consumer would expect in any other transaction.”

New York is not alone – 43 other states also got failing grades. But there were successful states that New York could learn from. For example, Colorado’s Medical Price Compare website allows consumers to search for prices according to zip code and type of insurance, and links that price information to quality and customer service measures.

Colorado was able to build their consumer website because it has something called an all-payer claims database. An all-payer claims database is the best source of information about health prices, because it collects information about the actual bills that consumers and insurance plans paid. New York started working on an all-payer claims database in 2011, but we’ve received an “F” every year from CPR because it has no public component, and because the law creating our database says nothing about sharing the data with the public.

It’s time for New York to prioritize transparency in the health care market, and that starts with asking us what we need to become informed health consumers. One way to demonstrate the importance of this issue would be to convene a state-level consumer transparency task force, with strong consumer representation. The state has identified consumers as an important stakeholder, and indicated that a consumer-facing website will be part of the project in the future. But consumers have been told to take more responsibility for health care costs for years now through higher deductibles and higher cost-sharing, without being given meaningful information about their choices. After five years of planning for the claims database, it is fair to start asking when and how consumers will benefit. A task force with adequate consumer representation would be one way to ensure that progress is made and that the end results are guided by consumers’ priorities.

CHP Picture

Last week, The Atlantic published an article entitled “The Unconscionable Difficulty of Getting Health Insurance for a Newborn.” The article tells the story of contributing writer Ester Bloom and her difficulties getting immediate Child Health Plus (CHP) insurance coverage for her newborn son. Coverage for Bloom’s son did not begin until six weeks after his birth, and in the interim she instead had to pay for much more expensive individual coverage through the Marketplace.

However, the original article neglected to mention the passage of Bill S4745/A7155 in December of 2015, which allows babies born into low and middle-income families eligible for Child Health Plus from the day they are born. Under this law, which takes effect January 1, 2017, parents who apply before the baby is born, or within 60 days of birth, will have CHP coverage for the newborn from the date of birth. Those who submit an application more than 60 days after the birth will be covered from the date of application. This law addresses the 45 day gap between parent application and newborn enrollment in CHP that Bloom describes in the article. For more details please see HCFANY’s original blog post from December 28, 2015.

We were excited to see a correction published on June 21, which included information about the law and how it will improve coverage for newborns under CHP.

This article also highlights the many challenges that consumers face when navigating the health insurance system as well as the importance of the trained assistance that health care Navigators, Certified Application Counselors, and Community Health Advocates can provide. New York State has been a leader in offering consumer assistance through these programs.

Parents who would like to enroll a child in CHP can do so through the New York State of Health Marketplace or by connecting to the Community Service Society Navigator Network at (888) 614-5400 or through their website.

mergerwatch

Hospitals have been consolidating at increased rates over the last five years. Merger and acquisition transactions grew from 66 transactions in 2010 to 112 in 2015. Earlier this month, the MergerWatch Project released the results of a national survey, which concluded that current state hospital oversight programs are inadequate to protect consumers’ access to needed health care services in their own communities.

By analyzing current Certificate of Need (CON) laws for hospital oversight, MergerWatch found that only 35 states and the District of Columbia actually have a Certificate of Need Program in place. California has a similar procedure through the Office of the Attorney General. In states that do have CON Programs in place, the majority do not require CON review for affiliations that do not involve formal sale, purchase, or lease or for hospital closures.

These less formal affiliations can still lead to a loss of access to critical health care services for consumers. In Sierra Vista, Arizona, for example, women lost access to many reproductive health services, including tubal ligation, when a nearby secular hospital joined a Catholic hospital system in 2010. Women in need of such services are sent to the nearest non-religious hospital, which is 80 miles away.

MergerWatch also developed a grading system based on whether a state’s hospital oversight program meets certain criteria including when CON review is required, CON review standards, and effective engagement with affected consumers and the public. Under this grading system only six states receive an A or A-. New York State receives a B grade overall.

Many existing CON Programs are not consumer friendly and make it difficult for consumers to access material information about hospital transactions and how they will impact their access to health care. Notably, only nine states require consumer representation on the CON reviewing body, and only six states require a separate public hearing for each CON application.

The final section of the report outlines model policies for state oversight of hospital transactions and action steps for advocates to take ensure that consumer interests are protected.

Access the full report here.