Texans, who have individual health insurance coverage through the Affordable Care Act (ACA), have noticed they have only two carrier options to participate in Preferred Provider Organization (PPO) networks: Humana and Baylor Scott and White. Humana has one PPO plan that is a $6450 high deductible health plan (HDHP). Baylor Hospital merged with Scott and White Insurance Company to form, “Baylor Scott and White”. This duo offers an array of PPO as well as Health Maintenance Organizations (HMO) health policies. Outside of these two companies, all other plans offered by Aetna, Blue Cross Blue Shield, Cigna, Coventry and United Health Care are Exclusive Provider Organizations (EPO) and HMOs.
Lets assume that a doctor can only see 10 patients a day. The doctor has a pre-negotiated rate with PPO networks of $100/patient. The negotiated rate with HMO networks is $50/patient. If a doctor accepts 10 patients/day that are PPO plans, a doctor will make $1000/day. If a doctor accepts 10 patients/day that are HMO plans, a doctor will make $500/day. If half the doctor’s patients have HMO plans and the other half, have PPO plans, the weighted average is $750/day. Currently, only group health insurance in Texas offer PPO plans. Therefore, doctors must know their patient population before refusing a HMO patient. If a doctor’s patient population is made of 50% Individual health insurance policies and HMOs are dropped, the doctor’s daily income will drop to $500/day. On the other hand, if his patient population is all businesses that have group health insurance in PPO networks, the doctor’s income will be $1000/day. As a result, doctors must know patient populations before refusing HMOs. Understanding this make up could take as long as 6 months to a year, depending on his patients annual scheduled visits to a doctor. As a result, if doctors blindly refuse to accept HMOs, this could reduce daily income by 50% or more.
This has left many Texans in a jam, especially if they live in rural areas of the state where only one Carrier Company is present. As an example, Blue Cross Blue Shield of Texas is the only health carrier represented in all 254 counties in Texas. Blue Cross Blue Shield is the only carrier in Wichita Falls, Texas. As a result, if doctors in this city only accept PPOs, then people with individual coverage have no local usable medical insurance. They must travel to a nearby city where more than one Carrier Company operates to obtain medical care from a doctor or facility that will accept HMO or EPO plans.
The Partial Solution
One solution to this problem is temporary health insurance for Texans. Some carriers such as Cigna and Health Insurance Innovations have short-term health insurance plans. These plans last for as long as 360 days or as short as 30 days and are not guarantee renewable. They can be obtained anytime throughout the year, but are not considered qualified health plans that meet the Affordable Care Act mandates. Short-Term plans are considered full coverage, but leave out three of the Ten Essential Health Benefits, which are required by the Affordable Care Act. The three excluded benefits are: maternity, mental health and pediatric dental and vision coverage. Choosing this plan over an ACA plan will trigger a fine, but will give full PPO coverage which most doctors accept.
The Permanent Solution
A permanent solution for the acceptance of individual health insurance in Arlington or individual health insurance in Fort Worth is for doctors to accept HMO plans. HMO plans have been a long fixture in states such as California. HMOs have always been used to manage care, especially with companies such as Kaiser Permanente and Blue Cross Blue Shield of California. As doctors continue to lose revenue by not accepting HMO plans, it is expected that most doctors in Texas will slowly give in to manage care networks. This may span six months or a couple of years, but it will eventually happen.
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