MANAGED CARE

Are legitimate MCOs charging for network membership?

The answer to the question above is, unfortunately, yes. Over the years, we’ve run more than a few articles warning clinicians against this very thing. Typically, a clinician would call us to say a completely unfamilar company was asking for $100, and promising a rich stream of referrals without explaining how they’d deliver.

This is a little different. Recently, we were in touch with a pair of therapists who joined a network first, began to receive referrals--and then got billed for network membership. The worst part: These aren’t insignificant companies. In each of the cases discussed below, the networks charging the fees are affiliated with major, national payers, making us wonder if this is a trend that will affect more provides in the near future.

? In December, a PsyFin reader in Wisconsin signed up with HealthEOS, a PPO based in De Pere, WI. She had one client who had the plan, and she went in-network as a favor--as she often does when clients tell her they can’t afford out-of-network rates. The reimbursement was "decent," she tells us, declining to specify. But then she started receiving bills from HealthEOS--$20 per month for network membership. (HealthEOS is affiliated with New York-based MultiPlan in a way we haven’t sorted out yet.)

She hadn’t noticed any such fee when she signed the provider agreement--an innocuous looking 12-page document.

"You assume it’s similar to the application forms you’ve filled out over the years," she adds. "So I can’t say I read every single word from beginning to end. Then when I got this, I called them to complain."

A HealthEOS rep directed her to the pertinent clause, which reads: "Provider shall compensate HealthEOS for the development, administration and maintenance of the Quality Management Program by paying HealthEOS the compensation specified in Exhibit 4, attached." Exhibit 4 specifies $20.

When we called HealthEOS to ask about the fee, the first representative we spoke to confirmed that there was such a charge, then promised to call us back with additional information. That call never came. When we called a second time, another rep told us that their provider contracts are proprietary, refusing further comment.

Another reader, this one in Illinois, has been paying $17 per month for two years to HealthLink, a St. Louis-based company that furnishes its network to insurance giant WellPoint-Anthem. The clinician tells us this fee is graduated, and climbs as you see more HealthLink patients. Like the practitioner in Wisconsin, this therapist is billed monthly.

HealthLink spokesman Tony Felts, responding via email, confirms the fee. "The administrative fee on all participating health care providers has helped HealthLink to offer network programs to contracted employers and payers at highly competitive access fees."

However, the company was forced to suspend collection of the fees in November, 2004, due to lawsuits. But by September, 2006, with a favorable ruling from the Illinois Supreme Court, they resumed the practice.

So what’s a therapist to do? Is paying for network membership the wave of the future? We’re not ready to go that far.

It’s important to note that in both of the cases discussed here, the referrals atarted flowing before any fee was charged. This, at least, distinguishes these companies from the mail-order scammers we’ve warned you about in the past. So a good rule of thumb is to ignore any company that demands their money up-front.

Susan Frager, a practice consultant and professional biller based in St. Louis, is willing to go even further. Don’t pay at all, she insists: "I’ve never heard of a reputable network charging money. Reimbursement rates are already so low...How can they make them even lower by charging fees?"

"Application and administrative costs are traditionally borne by the company...And now in the age of CAQH, everything’s standardized," she says, referring to the universal credentialing service many networks use. "The costs to the company are less than they’ve ever been."

On the other hand, there is an argument to be made that these kinds of charges are the next logical step for the industry. The fact is, no matter how low reimbursement rates drop, managed care companies are able to find clinicians who are willing to do the work. At the same time, rock-bottom rates are drawing bad publicity--not to mention lawsuits and the scrutiny of legislators. Finding new ways to reduce reimbursement without technically lowering fees makes a lot of sense--for them, anyway.

One final note: Frager says that some of the companies she bills have been threatening to charge extra fees to clinicians who file paper claims. "Watch for that to start happening," she says.

Contacts: 1) Susan Frager, Psych Administrative Partners, (800)841-5565, www.psychadminpartners.com; 2) Tony Felts, Healthlink, email: tony.felts@ anthem.com.

June, 2008