What are "Any Willing Provider" Laws?
Any willing provider (AWP) laws are aspects of managed care which allow certain types of healthcare providers, such as optometrists, to accept members of a certain plan or plans regardless of the provider network regulations. AWP laws were passed by many state legislatures in the mid-1990s to prevent restrictions placed on access to healthcare services by allowing providers to accept certain types of insurance. The AWP legislation allows physicians and other professional providers to enter into a contract with a health plan that has an AWP law and opt out of network participation requirements.
AWP laws allow physicians and other professional providers to practice as independent practitioners and contract directly with patients, instead of being limited to networks of physicians and hospitals set up by managed care organizations. AWP "ensures that the provider’s participation is voluntary and is his option. Once he agrees to be in the network , he must abide by all the rules of that plan."
Since traditional health insurance offered beneficiaries little choice with regards to their choice of provider, there was historically no need for a physician and patient to establish a doctor-patient relationship, so much as for the physician to establish a doctor-payer relationship. Consequently, patients perceived their once unlimited health provider accessibility as severely limited when a plan restricted a patient to a limited number of participating physicians within a health plan’s specific network.
AWP legislation permits more accessibility and less price discrimination. Optometrists also benefit from AWP laws by providing insurance companies efficiency in their payout. To provide some benefit to the plan or insurer for their having a cap of accessible providers, Ohio law allows all optometrists to charge participating optometrists the same fee for any service they perform.
Legislative History of Any Willing Provider Laws
The legal framework of any willing provider laws are underpinned by both state and federal legislation. At the federal level, the Employee Retirement Income Security Act of 1974 (ERISA) includes provisions that promote the development of managed health care plans, including preferred provider organizations (PPOs). By allowing insurers to distribute their coverage more evenly and control costs, ERISA has encouraged the growth of managed care.
In 1988, the Federal Employees Health Benefits Amendments established a requirement for FEHBP to cover services furnished by any willing provider, who is willing to accept the same conditions applicable under the plan to participating providers. (This has been codified in 5 U.S.C. § 8902 while 5 U.S.C. § 8902(a)(1) lists out the specific requirements of the law.)
In 1994, the Employee Retirement Income Security Act of 1974 (ERISA) was amended (in § 514(c) of P.L. 103-457) to exempt from preemption state laws that are demonstrably aimed at the regulation of the business of insurance as an industry. By extension of this amendment, in 1996, Congress passed the Health Insurance Portability and Accessibility Act (HIPAA), which had the effect of amending ERISA § 731(a)(1) by conspicuously including "the business of insurance" within "any patient review system."
In the 1999 case of Ky. Ass’n of Health Plans, Inc. v. Miller, the Supreme Court held § 514(a) of ERISA, which preempts state laws that "relate to" employee benefit plans, will not be construed to bar the application of state laws which "regulate insurance," i.e. state laws which are specifically directed toward the protection of insurance policyholders. However, only days prior, in New York State Conf. of Blue Cross & Blue Shield Plans v. Travelers Ins. Co., the Supreme Court held state laws which regulate insurance, including the state’s financial responsibility law, do not come before ERISA preemption test and therefore, the tests for preemption these laws will be determined under the Supreme Court’s decision in HMO Act.
Pros of Any Willing Provider Laws
Any willing provider laws have several significant implications for consumers, healthcare providers and insurance carriers. From a consumer standpoint, any willing provider laws increase patient choice. These laws compel insurance carriers to offer plans that include more providers in their networks, thereby giving patients greater access to medical services. Patients can visit healthcare providers who may have previously been outside of their insurance network. This adds choice to a market previously dominated by limited choice. On the provider side, any willing provider laws have a similar impact, in that they open previously closed markets. Providers have an incentive to negotiate and work within the confines of insurance networks because doing so means a potential influx of new patients. This increased level of competition can lead to the most competitive reimbursement rates by healthcare providers. Any willing provider laws also serve to promote alternative forms of delivery by obligating insurance carriers to offer a variety of insurance products. Insurance carriers benefit from the increased provider choice offered by any willing provider laws in that it allows them to negotiate with a much larger number of providers. The laws also minimize anti-competitive conduct among insurance carriers. Because providers are required to contract with all plans available in a given area, carriers are subject to less marketplace information. As a result, carriers cannot gain a competitive advantage by refusing to deal with specific providers. Due to the additional providers in any given insurance network, the coverage provided by the networks is also likely to improve. This could serve to lower costs for insurers and ultimately for consumers. The prescription drug formulary may also be impacted. Any willing provider laws would cause health insurance carriers to cover a greater number of prescription drugs prescribed by physicians who are required to participate in all plans in that geographic area. Having such a wide variety of physicians means increased drug utilization for those physicians.
Cons of Any Willing Provider Laws
These state laws have faced criticism and challenges from a wide variety of stakeholders. Many insurance companies argue that ‘any willing provider’ laws are driving up costs for consumers by forcing them to cover more providers. Todd Wagner, managing director of Gallagher Benefit Services Inc., reports, "Insurance companies…tell employers these measures are going to increase their costs and premiums, and they don’t like the idea of opening up their networks to everyone."
This argument is substantiated to an extent by an ongoing study conducted by The American Research Group, Inc. between 2006 and 2015 in which the states that have ‘any willing provider’ laws showed an increase in employer healthcare spending of $0.80 to $0.95 per month for employees. They noted that the rise in spending in these states was three times more likely to be attributed to these laws than in non-‘any willing provider’ states.
Health care providers and facilities have also argued and protested against such laws, claiming that ‘any willing provider’ laws are not comprehensive enough. "These rules extend to only one type of provider: those who participate in a PPO , or preferred provider organization network," says Timothy Jost, a law professor at Washington and Lee University and a former member of the National Association of Insurance Commissioners. "If you take someone who’s in a point of service plan or an exclusive provider organization, these ‘any willing provider’ laws may not help them at all."
Another line of critique against ‘any willing provider’ laws is their failure to combat anti-competitive behaviors in the healthcare sector. While ‘any willing provider’ health plans might be beneficial for consumers in regulating premium cost inflation, they have little to no impact on the market power that larger provider networks hold over insurance pooling and pricing.
David Balto, who was formerly responsible for antitrust enforcement at the Federal Trade Commission and currently serves as a visiting scholar at the Center for American Progress, voices this sentiment stating, "Any willing provider laws don’t knock the more powerful networks off their perch, so they have no meaningful effect on a hospital’s power in a local area."
Case Studies and Precedents
Despite the generality of state "any willing provider" laws, some states have tailored them in unique ways, creating real consequences. Florida – a state with many managed care plans and a history of adopting "any willing provider" laws – has a history of legal interpretation of its "any willing provider" statute. Though the statute broadly speaks in constitutional terms about the rights of patients, it has been interpreted by the Florida courts as both allowing restrictions on patient choice and allowing non-participating providers to sue participating providers.
In 2007, the Florida Supreme Court ruled that an HMO violated "any willing provider" laws when it eliminated a non-participating provider from its panel on the basis of a patient complaint; the "any willing provider" provision contained in one Florida statute was not applicable to preferred provider organizations.
Controversy also exists over the language of the "any willing provider" statute itself. The American Medical Association ("AMA") filed a lawsuit against Florida in 2000 on the grounds that the "any willing provider" law violated the First and Fourteenth amendments of the U.S. Constitution. Florida responded by enacting another "any willing provider" statute patterned after Massachusetts, which the AMA approved. The AMA now encourages "any willing provider" provisions, but California courts have gone the other way and specifically denied coverage to an off-duty police officer’s claims arising from a gunshot wound rather than motorcycle accident. In California, a federal court determined that the "any willing provider" law did not apply to the question of on which hospital a patient should be treated.
The disputes have shaped the landscape within Florida, and the litigation and court interpretation of what an "any willing provider" law means continues to this day. Similar disputes exist elsewhere, but the differences across states also provide some uniformity: once a state like Florida approves a worded "any willing provider" provision, other states will adopt some variation of it.
The Future of "Any Willing Provider" Laws
Potential future developments regarding "any willing provider" legislation include the consideration of reforms to these laws, ongoing debate in the legislature and statehouses, and potential new initiatives aimed at bolstering the rights of providers wishing to participate in managed care networks. Some legislators advocate for a more expanded role for state regulatory authorities while others call for legislation that curtails the authority of state insurance departments. Additionally, in many states, there has been talk of creating alternative dispute resolution processes where providers can appeal decisions by health plans to exclude providers from their networks.
Several states have recently seen proposed legislation that, if adopted, would expand provider access under "any willing provider" acts. In Ohio , a bill was introduced that would remove limitations on who may make medical decisions or set treatment plans for patients in psychiatric facilities (H.B. 460). A bill that would require insurance plans to offer stable rate formulas for contracts issued by new or existing carriers was also introduced in Ohio (H.B. 444). Similarly, in Hawaii, a bill was introduced that would prohibit health care insurers from denying or limiting coverage based on gender identity (S.B. 113).
The conversation surrounding "any willing provider" legislation will likely continue to be dominated by consumer advocates seeking to challenge the restrictive practices of managed care plans. Additionally, a likely area for concern and continued public discussion is whether particular classes of providers are receiving fair compensation and whether certain insurers are enabling health plans by not closely watching for discriminatory rates and encouraging providers to negotiate contracts.