and infrastructure — often in urban areas — to join together, but Texas col- laboratives provide an avenue for local control, allowing participants to tailor an HCC to a community’s needs. A state collaborative can be big or small, broad or narrow in scope, Dr. Lockhart says. “It doesn’t have to be all things to all people, and physician in- volvement in the governance will allow for that in determining the priorities of the organization, how it’s going to serve the community, and how it’s going to spend resources.” To avoid disruptions in patient-phy-
sician relationships, TMA lobbied suc- cessfully to prohibit an HCC from using noncompete contracts to bar doctors from participating in more than one col- laborative or from working in the area if they choose to leave the organization.
The path to licensure
The new TDI rules spell out the docu- mentation and fees required to apply for and maintain an HCC license, depending on the size and scope of the organiza- tion, officials say. Mr. Hunt said the insurance depart- ment will evaluate:
• How the collaborative is structured; • How payments are arranged and dis- tributed among participants;
• An HCC’s ability to deliver the health care it promises and to pay its mem- bers;
• The organization’s financial where- withal to operate; and
• Any impact on competition. When it comes to payment arrange-
ments, for example, a collaborative can contract directly with insurers for physi- cian and hospital payments and distrib- ute that money among its members. In- surers also may delegate managed care or risk to an HCC, but an HCC license does not mean a collaborative may op- erate as an insurer, Mr. Hunt explained. To guard against insolvency, TDI rules
require HCCs to maintain a certain lev- el of reserves, based on their size and payment structures, to maintain opera- tions and pay their physicians and other providers. On top of that, any payers
in an HCC must set aside at least three months of payments, separate from oth- er required operating reserves. Those cushions are meant to make sure that if a collaborative encounters financial trouble, “providers are timely paid, and members get their services,” Mr. Hunt said.
HCCs also must establish a quality assurance plan demonstrating adequate networks; increased collaboration; pro- motion of improved patient outcomes, safety, and care coordination; and cost- containment without compromising care quality.
Health plans, for example, must fol- low existing credentialing and network adequacy requirements meant to ensure patients have access to the kind of care a collaborative promises to offer. “Where it varies will depend on the type of collaborative. It could be a full- service plan, or it could be restricted to cardiac cases, for example, in which case we would be looking at the type of pro- viders utilized in that realm of care ver- sus the whole scope of medical practice,” said Debra Diaz-Lara, director of TDI’s Managed Care Quality Assurance Office.
“We will look at [network adequacy] based on where [a collaborative] is lo- cated, what type of services it plans to provide, and how many [patient] mem- bers it will have.” TDI borrowed some quality improve-
ment program components from federal ACO guidelines, such as requiring state collaboratives to demonstrate patient buy-in, establish measures for quality and cost, and set up defined processes for monitoring and reaching their goals. The rules do not, however, dictate which quality measures HCCs must use.
“We wanted to have some framework. But we also wanted to be flexible be- cause the market may have some even better quality measures than what we could have come up with, and we would like to see what [collaboratives] have to offer,” Ms. Diaz-Lara said. If an HCC’s quality improvement pro-
gram proves ineffective, the licensure rules give the collaborative and TDI the ability to adjust.
Also included in the quality assurance standards are safeguards giving physi-
cians the right to file complaints with due process protections, so they can ad- vocate on their patients’ behalf without fear of reprisal, Dr. Lockhart noted.
Checks and balances Quality, innovation, and market influ- ence likely will top the list of things the attorney general will evaluate to deter- mine what an HCC brings to the table to merit antitrust exemptions.
“Those types of initiatives will weigh heavily because that’s how society will benefit. The goal would be to produce a better clinical product at a lower cost,” Dr. Lockhart said.
TDI will conduct an initial antitrust evaluation of the size and relative mar- ket power of the HCC. If warranted, however, a more in-depth review of that impact and a final determination rest with the attorney general. The Attorney General’s Office said in a statement that the purpose of its re- view is “to ensure to the extent possible that anti-competitive problems don’t occur after the license is issued.” That includes an analysis of “whether the proposed HCC will have market power or reduce competition, and whether any reduction in competition will be out- weighed by the benefits that flow from the ability to provide better care through coordination.”
If an HCC clears the antitrust review and other hurdles in the licensure pro- cess, it receives immunity from state antitrust laws and has a defense against federal antitrust enforcement. The exemption drew some pushback
from the Federal Trade Commission (FTC) when legislators debated SB 7. In response to a May 2011 request from Rep. Elliott Naishtat (D-Austin), the commission raised concerns that the antitrust exemptions “are likely to lead to dramatically increased costs and de- creased access to health care for Texas consumers. The review provisions in the bill appear unlikely to prevent these harmful effects.” In defense of the legislation, key sponsor Sen. Jane Nelson (R-Flower Mound) called the “FTC’s interference in our legislative process” an “inflamma- tory and inaccurate attack.”
June 2013 TEXAS MEDICINE 27
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