A key challenge of the Affordable Care Act — the principle of covering more people through the insurance exchanges under Obamacare — is playing out in Miami-Dade Circuit Court this month as a group of South Florida hospitals spars with a health insurance company over payments for emergency room services.
The lawsuit was filed in February by Kendall Regional Medical Center and eight other local hospitals owned by the Tennessee-based Hospital Corporation of America, or HCA, one of the nation’s largest for-profit systems.
In the complaint, HCA alleges that Molina Healthcare of Florida chose not to include the hospitals as in-network for Molina’s Obamacare plans from 2014 through Sept. 30, 2015 — and that the health insurer then underpaid the hospitals by more than $88 million.
The HCA hospitals and Molina, headquartered in California, have since agreed to a contract detailing payment rates for services. But they have yet to resolve the dispute over emergency room care provided prior to Oct. 1, 2015.
When contacted by the Herald for comment, HCA and Molina both provided the same written statement: “The parties are in active business discussions with the goal of resolving the matter.”
Even if the issue is resolved, healthcare experts say the lawsuit underscores the complexities of healthcare reform under the ACA as insurance companies continue to exclude more doctors and hospitals from their provider networks in order to drive down the price of coverage for consumers.
Steven Ullmann, a healthcare policy expert at the University of Miami, said the ACA has inspired an explosive growth in “narrow network” health plans with lower monthly payments but access to fewer hospitals and doctors.
In 2014, he said, the number of narrow network plans increased by 150 percent while the number of “exceptionally narrow network” plans — meaning those that exclude 70 percent or more of the 20 largest hospitals in their region — increased by 173 percent.
Narrow network plans help insurers keep their costs low. But they also shift more responsibility onto consumers, who often cannot access basic information to guide their choices, whether it’s finding an in-network doctor or hospital, or the price of a medical procedure, Ullmann said.
“Consumers are being required to make decisions,” he said. “But you can't get information about pricing. You're not getting information about coverage. Even to call those who are providers and get an indication of whether they are covered under your health insurance plan, it’s often difficult to get that information.”
Cynthia Cox, a health reform expert with the nonprofit Kaiser Family Foundation, said that in the first two years of the ACA exchanges consumers could not tell during enrollment whether their preferred doctors and hospitals were included in a plan.
“Most of the people who received out-of-network care did not realize they were going out of network at the time they got the treatment,” she said.
For 2016, though, the federal government added features to the enrollment website at healthcare.gov that allow consumers to see whether a plan includes their doctors or hospitals.
Molina’s Obamacare plans covered about 150,000 people in Florida, the vast majority in Miami-Dade, as of Sept. 30, 2015, according to the Florida Office of Insurance Regulation.
In the complaint, HCA says Molina made a strategic prediction that Florida residents who buy Molina's ACA plans would avoid out-of-network hospital emergency rooms.
But the nine HCA hospitals named in the lawsuit, including Aventura Hospital and Medical Center, said they provided emergency room care to more than 3,000 members of Molina’s Obamacare plans from 2014 through Sept. 30, 2015, for a total of more than $104 million. But Molina reimbursed only $13.6 million.
The HCA hospitals accused Molina of paying them less than the insurer’s negotiated rates to in-network providers, and of violating Florida’s statutory rules for resolving payment disputes between healthcare providers and insurers.
Douglas Wolfe, a Miami attorney who represents hospitals and physicians in legal disputes with health insurers, said that legal disagreements like the one between HCA and Molina are being watched across the country.
With hospitals taking on more bad debt from insured patients who cannot afford out-of-network charges, and few political alternatives for changing the health law to address the adequacy of insurance plan networks, Wolfe said he expects the courts to play a key role in finding a solution that’s acceptable to insurers, hospitals and patients.
“Most likely,” he said, “it’s going to be left to the courts to decide.”