NATIONAL REPORTS — A new Ohio mandate standardizes the credentialing process and promotes more contracting transparency and fairness in the managed care process.

Stamer

The Ohio State Medical Assn. (OSMA)-sponsored Healthcare Simplification Act (HB 125) will bring significant, positive changes to contracts between health insurers and physicians, according to Lisa Hackley, director of communications, OSMA.

"Physicians have had trouble in the past with access to fee schedules," Hackley says. "With the new law, physicians should have improved access to this information."

Cynthia Marcotte Stamer, a member of Glast, Phillips & Murray PC, Dallas, Texas, and chair of the ABA Health Law Section Managed Care & Insurance Group, says the new Ohio law enacts "a hodgepodge of overhauls that have been done in some version in various other states such as California, Florida, Mississippi and Texas."

According to Stamer, many states have adopted specific statutory provisions or regulations governing contracting and claims processing requirements. For example, the Texas Insurance Code for many years under its prompt-pay and clean-claims rules has protected providers' right to receive notice of contract terms and changes, to get information about the calculation of benefits and other provisions overriding the use of certain types of contractual practices in provider contracts, and to receive provider credentialing rules.

"The Ohio law builds on this trend by implementing sweeping, detailed specific mandates governing contracts and their transparency," Stamer explains. "What's interesting is that [the law] provides an outline of the minimum required content that the contract must contain including specific and detailed mandates dictating that the contract include many specific provisions, as well as other requirements about rights the contract must expressly provide and prohibitions about the inclusion of certain other types of contractual provisions."

The new law is composed of three parts: transparency in contracting, fairness in contracting and standardized credentialing.

• The law requires that physicians get a copy of the full fee schedule from HMOs, third-party administrators (TPAs) and other insurers so that the physicians will know how much they will be paid for their services.
• A "summary disclosure form" will outline compensation terms, categories of coverage, duration of the contract, the entity responsible for processing claims, and the method of dispute resolution. The law also requires specific notice be given to the physicians of any addenda to the contract.
• Restrictions on the selling or renting of a physician's contract to another company will be imposed unless the rental is disclosed and all of the terms of the original contract are honored.
• The law prohibits "most favored payer" clauses in contracts that force doctors to provide healthcare services at a lower price than originally called for in the contract.
• Insurance companies must notify doctors 90 days in advance of changes to a contract that either decrease payment, increase administrative expenses or add a new product.
• Restrictions will be imposed on the use of "all products" clauses that force physicians to participate in all of an insurer's products.
• An insurer cannot force a physician to accept its future product offerings.
• The Council for Affordable Quality Healthcare (CAQH) credentialing form will be the sole credentialing form used by insurers in Ohio. No additional information can be solicited by individual insurers from physicians seeking to be credentialed.
• All physicians will be credentialed within 90 days.
• A $500-per-day penalty or retroactive reimbursement will be required if an insurer fails to meet the 90-day credentialing deadline.