Earlier this year, the Arkansas General Assembly passed legislation that will prohibit insurers from including “all products clauses” in contracts with healthcare providers. “All products clauses” require providers who participate in one of an insurer’s health plans or networks to participate in the insurer’s other plans or networks. Historically, if a doctor refuses to participate in one of the insurer’s networks, the insurer may terminate the doctor from all networks.
Healthcare providers often view “all products clauses” as coercive and lacking transparency, leaving them with a contract that is a “take-it-or-leave-it” proposition. The clauses may require participation in plans or networks that have more stringent participation requirements or lower reimbursement rates, making them less attractive to healthcare providers. Insurers counter that the clauses promote continuity of care between a patient and a physician when a patient switches plans.
In Arkansas, insurers have used these types of contractual requirements to ensure network adequacy in qualified health plans (QHPs) offered on the Health Insurance Marketplace. Both individuals receiving federal subsidies and individuals who are eligible for Arkansas Medicaid’s premium assistance waiver program, Arkansas Works, obtain coverage through QHPs. More than 300,000 Arkansans are currently enrolled in QHPs.
In an effort to control annual premium increases and to ensure that the Arkansas Works program does not exceed budget caps, insurers have reduced reimbursement rates for providers in QHP networks in at least three years since 2014. The new legislation regarding “all products clauses” could offer healthcare providers an opportunity to refuse to participate in QHP networks in response to reimbursement reductions. This could result in questions about insurers’ ability to meet network adequacy requirement and provider access challenges for QHP enrollees.
Insurers offering QHPs must submit premium rates for the 2020 plan year to the Arkansas Insurance Department (AID) by July 19. AID will review the rates for actuarial soundness, and final rates may be adjusted for next year if historical patterns persist.