TEXAS MEDICAL ASSOCIATION HOUSE OF DELEGATES
Resolution 407 (A-07)
Subject: Transparency of Health Plan Medical Cost Ratio
Introduced by: Harris County Medical Society
Referred to: Reference Committee on Socioeconomics
Whereas, Health insurance premiums continue to rise; and
Whereas, Payments to physicians from health plans for health care continue to diminish; and
Whereas, Health plans continue to post ever increasing profits; and
Whereas, Health plan executives are making billions of dollars a year; and
Whereas, Health plans routinely use bundling tactics as a cost reduction strategy; and
Whereas, Texas Medical Association Policy 180.015, Managed Care Patient Protection, states: "The plan will reveal enrollment, income, amount expended for patient care, administrative costs, and profit"; and
Whereas, TMA Policy 180.014, HMO Financial Reporting, states "devote more of the premium dollar to medical and health services instead of profit and administrative costs"; and
Whereas, American Medical Association policies state that the premium dollar needs to be dedicated to direct medical care; and
Whereas, The best way to quantify this impact is to mandate transparency of premium dollars spent on direct health care; therefore be it
RESOLVED, That the Texas Medical Association and the American Medical Association encourage and work for legislation at the state and federal levels mandating complete transparency of health plan financial data.
Relevant TMA Policy
180.015 Managed Care Patient Protection . The Texas Medical Association voted to use its influence to make sure that patient protection and managed health care system legislation includes: language stating that there can be no form of reward or financial incentive to limit appropriate care, including referrals; an affordable point-of-service option so patients have the opportunity to be seen by the physician of their choice outside the plan; and the opportunity for patients and providers to fill out a "report card" at regular intervals regarding the quality of service rendered by the plan. The plan will reveal enrollment, income, amount expended for patient care, administrative costs, and profit. This information will be compiled and made available to patients, health care providers, employers, and plan administrators. In addition, TMA urges inclusion of these provisions in both federal and state Patient Protection Acts to make it clear to managed care plans that their primary function is to ensure that patients receive quality care from physicians of their choice with the major portion of the premium dollar being used to provide medical services (Res. 28K, p 137, A-95; reaffirmed CSE Rep. 1-A-05).
180.014 HMO Financial Reporting . The Texas Medical Association voted to ask the AMA to disseminate HMO financial reporting information widely to the media and the public in an effort to help drive down the costs of medical care and encourage for-profit HMOs to be more efficient and devote more of the premium dollar to medical and health services instead of profit and administrative costs (Supplemental Council on Socioeconomics, p 112A, A-95; reaffirmed CSE Rep. 1-A-05).
Relevant AMA policy
D-180.985 Health Plan and Insurer Transparency : Our AMA will: (1) continue to closely monitor any new "transparency" programs unveiled by health plans to determine the impact on physicians; (2) communicate to health plans, employers and patients our concerns about current "transparency" programs, and educate them about "true transparency"; and (3) continue to educate physicians about the complexities of claims adjudication and payment processes to enable them to more efficiently manage their practices. (BOT Rep. 19, A-06)
TMA House of Delegates: TexMed 2007