CHA News Article

Department of Insurance Issues Proposed Permanent Regulations on Provider Network Adequacy

The California Department of Insurance (CDI) issued its proposed permanent regulations on provider network adequacy last week. The current emergency regulations require hospitals to disclose to patients, prior to a scheduled procedure, non-network providers who are likely to provide care and the estimated costs of that care. CDI recognized that this would be an impossible undertaking for hospitals, and has deleted this requirement in its proposed permanent regulations. CDI also defined an adequate network as “one in which the care provided to an insured person in a network facility is provided by network providers.” If an insured person chooses to receive care while in a network facility from a provider who is not in the insurer’s network, then the use of that out-of-network provider does not render the network inadequate. Health plans are obligated to provide their members with directories clearly explaining out-of-network options and cost-sharing tiers as well as a sufficient list of hospitals, physicians and specialists with admitting privileges to in-network hospitals. This is very positive news for hospitals. 

All written comments must be received by the Insurance Commissioner no later than 5 p.m. Nov. 9. The Commissioner will hold a public hearing Nov. 9 at 10 a.m. at the Stanley Mosk Library and Courts Building in Sacramento.

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