News Release

New Jersey Department of
Banking and Insurance

Commissioner Tom Considine

For Immediate Release:
September 29, 2011

For Further Information:
Ed Rogan or Marshall McKnight (609) 292-5064

TRENTON – As part of the Christie Administration’s continuing efforts to bring down health care costs by working with health care providers and reducing regulatory burdens, Department of Banking and Insurance (DOBI) Commissioner Tom Considine and key members of the Department visited five New Jersey health care providers recently to hear their concerns, observe their daily operations, and assess their challenges in meeting administrative requirements imposed by insurance carriers. To improve the regulatory climate, DOBI is focused on streamlining its rulemaking and permitting process in line with Executive Order No. 2, signed by Governor Christie in 2010, which requires all departments and agencies to apply “Common-Sense Principles” in its rulemaking process. 

“Bending the cost curve of health care and reducing the regulatory burden on business are key priorities for the Administration,” said Commissioner Considine. “We are working diligently with the State’s health care providers to achieve both of these goals. To reduce health care costs, we must look at administrative burdens across the entire spectrum of the delivery system.  We need to look at all administrative costs, whether they are imposed by government, health plans or any other party.”

The DOBI team visited the offices of a cardiovascular physicians group, an oncology group, an ophthalmologist, a radiologist and a vascular surgeon.  

“It was a learning experience for all of us,” said Commissioner Considine. “It was eye opening to see firsthand what goes on hour by hour in a medical provider’s office, what is involved in the administration of a practice and what goes into complying with insurance carrier rules. I am not saying all administrative requirements that insurance carriers impose on providers are excessive, but clearly providers expend a lot of time, effort and resources on compliance. This is an area where I think we can make some improvements.”

“The Medical Society of New Jersey (MSNJ) was pleased to coordinate these efforts with Commissioner Considine and his staff  so insurance regulators could better understand the administrative hurdles that many physician practices face on a day-to-day basis,” said Medical Society of New Jersey CEO Lawrence Downs.  “We hope that the Commissioner and his staff found these visits valuable and perhaps gained some insight into the complexities of doing business with health insurers.”

“As physicians, our number one focus is on treating our patients to the best of our abilities” said MSNJ President Dr. Niranjan (Bonki) Rao.  “We thank the Department for taking an interest in how physician practices operate in New Jersey and look forward to an ongoing dialogue.” Other Department efforts to work with health care providers, lessen their administrative burden and develop ways to cut the costs of health care over the last 18 months include: 

• Maternity Installment Regulations – In June, Commissioner Considine signed a new regulation permitting providers to elect installment payments to obstetricians and gynecologists who perform maternity care. The regulations implement a law under which providers could be paid periodically over the course of a pregnancy; where in the past carriers reimbursed medical professionals after delivery of the baby in an amount that covered a range of services, including prenatal care, testing, examinations and medical treatment that typically stretch through a period of about 40 weeks. Under the new regulation, obstetrical providers can elect either global, or installment payments; the sum of the installments cannot be less than the global payments; providers can change payment systems annually, and for those providers using the installment system, there must be at least three payments.
  
  
• Claims Denials – Responding to medical provider complaints, Commissioner Considine signed a bulletin in February reminding health insurance carriers that they may not deny a claim after authorizing services that were medically necessary or limit payment to lesser services unless there is fraud or misrepresentation. The bulletin further reminded carriers that they may not apply a penalty due to lack of an authorization for the provision of less invasive or less extensive services than those authorized.
  
  
• Health Care Reform Implementation – The Department held four forums specifically with groups of health care providers to solicit their input in planning for the implementation of exchanges under the federal Affordable Care Act. The Department held these hearings for providers in a greater number than any other constituency in recognition that providers are the front line of health care delivery. Providers’ input on this issue will be instrumental in determining New Jersey’s approach to health care reform.

Other areas under review include improving the provider credentialing system, strengthening provider agreements, clarifying the reimbursement system and improving provider directories.

“Our health care providers are on the front line of the health care system and as such we value them very deeply,” said Commissioner Considine. “My goal is to work with them and our insurance carriers to do whatever we can to bring down the costs of health care. We are all looking for ways to achieve maximum efficiency in the system and that means all parties must work together to eliminate unnecessary steps.”