Study finds disparities in the adequacy of services and quality of information provided following states’ regulation of managed care networks

More than 160 million Americans—three out of every four who have health insurance—are enrolled in managed care plans. Under these plans, enrollees receive health care from a network of contracted providers.

Beginning in the 1990s, and escalating after the Affordable Care Act in 2010, these networks faced a major backlash after enrollees reported significant, widespread problems with the quality and accessibility of care.

In response, nearly every state government issued bills—more than 1,000 to date—regulating the size and makeup of managed care networks and how consumers can access care information.

Now, for the first time, a study led by Simon Haeder, PhD, associate professor in the Department of Health Policy and Management in the Texas A&M University School of Public Health, provides a comprehensive assessment of how well these regulations are working in the commercial insurance market. The team focused mainly on states’ efforts to ensure that provider networks were adequate, especially for underserved populations, as well as the accuracy of the directory information networks made available to consumers.

“These two areas are especially important,” said Haeder. “Consumers have little choice when it comes to their network, so it’s crucial that networks have enough medical providers and that care is accessible to all who are paying for it. In addition, consumers get information about their health care options from their carriers, so it’s important that the information is correct.”

The researchers also provided a brief overview and assessment of recent federal government efforts in these areas, with potentially beneficial lessons learned from the state-level experience.

For the review, Haeder and his team searched the Westlaw database for state statutes and regulations that included relevant key words. Ultimately, they analyzed 317 distinct regulations and 309 distinct statutes. They identified eight factors related to efforts to guarantee consumer access to medical care. To assess whether states included rules to ensure accessibility for disadvantaged populations, they identified whether accommodations were stipulated, such as for non-English speakers, extended hours and locations accessible by public transportation.

To review the accuracy of directory information, they focused on requirements for insurance carriers to keep directory information updated, to inform consumers when a provider left the network and whether the regulations required directories to include information for underserved consumers, such as those with disabilities or who were not proficient in English. They also examined whether states specified any means of enforcing these regulations.

In the area of provider network adequacy, the study found that most states had specific requirements for the number of providers that carriers must include in their networks, maximum travel distances for consumers, appointment wait times and so on. Other states used more generic terms, such “a sufficient number and type of primary care providers” (Kentucky) and “customary waiting times for appointments for urgent and routine care” (New Jersey).

Eighteen states specifically outlined protections for underserved populations. Hawaii, for example, required networks to include providers “that serve predominantly low-income, medically underserved individuals.”

The researchers found 67 instances of states requiring carriers in 38 states to keep information updated. Some provided specific timeframes, such as Vermont’s requirement that directories be updated every six months, while others did not. In addition, 25 states required notifications when a provider left the network, and 14 states required directory accommodations, such as Spanish-language text, for underserved populations.

Although states have regulated provider networks for years, Haeder noted that the Biden administration has recently launched similar programs.

“The federal government’s involvement on network adequacy issues was limited until the recently introduced steps for both the Medicare Advantage program and the Affordable Care Act marketplaces,” said Haeder. “These efforts are important in extending protections to more Americans, especially given the exemptions in the Employee Retirement Income Security Act of 1974 that hamper this at the state level.”

What led to the current state of affairs? Haeder said previous researchers have identified issues such as a lack of resources and of political interest, and that this new study adds another factor: a lack of ways to enforce the existing statutes and regulations.

“This is a serious issue,” said Haeder. “We found only 25 instances in all the state statutes and regulations that had clearly stated measures for enforcing network adequacy.”

Haeder said the issues involved are complex. Ultimately, he said more research is needed in the broader regulatory approaches in ensuring greater levels of accuracy and adequacy, especially regarding the development of effective regulatory standards and the scope of compliance and enforcement.

“The system will never be perfect,” he said, “so we need a general discussion about what standards are acceptable and benefit the most people.”