The Health Care and Wellness Committee approved bipartisan legislation from Rep. Paul Harris on Wednesday that would assist independent health care providers.
Many private health care providers, such as chiropractors and acupuncturists, are struggling to stay in business due to the lack of reimbursement fees from health insurance companies. House Bill 1655 would require contracts between insurance companies and providers to include an increase from the previous year based on the consumer price index.
“Our small, private health care providers haven’t received an increase in their reimbursement fees for about 10 years,” said Harris, R-Vancouver. “Most of them have seen a decrease. In fact, many small providers are now receiving as much as 20% less in reimbursement fees for the same services, as they did 20 years ago.”
The costs to operate and maintain a private health care practice by health care providers continue to rise, sometimes even exceeding the consumer price index.
Significant consolidation in health plan markets has given insurance companies greater bargaining power over individual health care providers and small clinics who have little or no opportunity to negotiate compensation to cover overhead costs.
According to a 2020 American Medical Association survey, nearly 40% of patient care physicians were employed directly by a hospital, or a practice owned at least partially by a hospital or health system, compared to just 23.5% in 2012.
House Bill 1655 would level the playing field by allowing a group that doesn’t have equal bargaining power the ability to still receive increases in compensation, by requiring insurance companies to annually adjust the compensation offered to health care providers not employed by hospitals or affiliates of hospitals.
The amount would reflect inflationary cost increases, which would help deter further consolidation in health care delivery markets.
“We need to help our small medical providers, so we continue to have access to their valuable services,” added Harris. “These non-negotiated reimbursement rates are unsustainable, and if they persist, small health care providers and clinics will have to consider drastic options that may limit patient options. The insurance companies have shown for more than two decades they are not willing to increase reimbursement fees. So, it’s time the Legislature act.”
The 2024 legislative session is scheduled to end on March 7.