S.1197B/A.8592 – Minimum Primary Care Services Spending

Re:      S.1197-B (Rivera)/A.8592 (Paulin) – AN ACT to amend the insurance law and the social services law, in relation to primary care investment

This legislation, S.1197-B/A.8592, would require all health insurers to report to the State the percentage of overall annual health care spending on primary care services and mandate that at least 12.5% of all total annual expenditures are directed to primary care services.  While health plans support making investments in primary care to further the goals of improving care coordination, quality, and access to health care services, the bill is overly prescriptive, includes no accountability on provider systems to ensure the funding flows to primary care, and will increase premiums for consumers and employers.

Managed care plans are founded on principles that emphasize primary and preventive care.  Health plans currently work with providers to encourage primary care utilization through value-based payment arrangements.  Achieving value from specific spending targets will depend on having providers who have the capacity and interest to engage in payment arrangements that emphasize primary care.  Mandating specific incentives or payment levels toward one segment of the health care system could result in unintended outcomes, such as not being able to incent other kinds of services that, although not directly related to primary care, could help to promote improved health outcomes.  Rather than allow health plans to continue to work with providers to develop innovative strategies to increase utilization of primary care services, this bill would unnecessarily restrict how health plans currently spend premium dollars.  This kind of payment mandate will interfere with efforts to integrate primary care with behavioral health care and social care, as it creates silos for those mandated payments.  These restrictions run counter to the goal of the proposal, and to other efforts the State is currently undertaking to incentivize investments in primary care services and better integrate primary and behavioral health care.

Further, the bill fails to require that providers make comparable investments or ensure that funding flows to primary care.  Health plans may negotiate at the system level and do not control how funds flow through the provider system.  As more primary care practices are acquired or become affiliated with large provider systems, accountability from those systems is necessary to ensure that mandated expenditure targets for primary care is realized.

Finally, any increase in spending on specific segments of the delivery system without comparable offsets in other areas, such as specialty care or prescription drugs, will have the effect of increasing costs, exacerbating the challenges consumers and employers have in finding affordable coverage options.

For all these reasons, HPA OPPOSES S.1197-B/A.8592.