Ohio Pathologists, CAP Seek Revision to Out-of-Network Reimbursement

The Ohio Society of Pathologists (OSP) and the CAP have asked the Ohio State Medical Association (OSMA) House to seek revisions to the payment for out-of-network services and adopt a specific policy requiring health plan network adequacy hospital-based physicians by specialty. The CAP has worked closely with the OSP to advocate on requiring health plans to have adequate networks of hospital-based physicians, including pathologists.

House Bill 388, which takes effect on January 12, 2022, requires health plans to reimburse for out-of-network providers at the highest of three options: their in-network rate, their out-of-network rate, or the Medicare rate. Despite the opposition of OSP, the bill was supported by OSMA and the health insurance industry.

A resolution (15-2021) introduced in the Ohio State Medical Association by Robert Gurdak, MD, FCAP, the OSP representative, argued that this law effectively provides a disincentive for health plans to contract with certain hospital-based physicians. The resolution further notes that the Medicare payment safeguard under HB 388 (100% of Medicare) is the lowest in the nation, with some states such as Michigan and New Mexico having a payment safeguard of 150% of Medicare.

“The HB 388 100% of Medicare out-of-network payment safeguard, when conjoined with the median in-network alternative payment methodology enacted as part of HB 388, constitutes a disincentive to health plans offering contracts to hospital-based physicians that pay greater than Medicare,” the resolution states. The resolution further notes that federal law (the No Surprises Act) provides physicians with a more favorable out-of-network payment methodology that is not keyed to in-network rates or 100% of Medicare. The No Surprises Act was enacted in late 2020 as part of Congress’s year-end omnibus spending bill and takes effect January 1, 2022.

The enactment of HB 388 will displace the applicability of the federal law, resulting in fewer protections for out-of-network hospital-based physicians, argues the OSP, which is asking the OSMA to advocate to include in the state budget a revision to the out-of-network payment formula established under HB 388 to statutorily defer such payment to federal law. Alternatively, the budget could be revised to increase the Medicare percentage safeguard for out-of-network payment to be 125% of Medicare or more, according to OSP.

The OSP strongly urged OSMA to secure enactment of the specific policy (Network Adequacy H-285.908(11)) of the American Medical Association related to state regulators requiring health plan network adequacy for hospital-based physicians by specialty.

OSMA is scheduled to hold a hearing on the resolution (15-2021) on Saturday, April 10. The Ohio House will discuss the issue on April 11. During the month of March, pathologist members of OSMA can weigh in with their support of the resolution by visiting OSMA | Annual Meeting Policy & Resolutions.