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  • Writer's pictureThe San Juan Daily Star

Insurers called out for cutting payments to medical labs

The president of the Clinical Laboratories Association of Puerto Rico says the contracts between health insurance companies and laboratories only benefit the insurer.

By The Star Staff

The head of the Clinical Laboratories Association of Puerto Rico (ALCPR by its Spanish initials) warned Monday that health insurance plans in Puerto Rico are out of control as they are forcing labs to renew contracts containing cuts to their compensation for providing services.

Laura Trujillo said the contracts between health insurance companies and laboratories only benefit the insurer.

“They were drafted to displace protections derived from the Puerto Rico Health Insurance Code, for health service providers,” Trujillo said in a statement. “The MCS contract imposes a reduction of 8.5 percent in payments to laboratories, which must be added to the 20 percent already imposed in 2014 by the company.”

MCS Advantage, also known as MCS Classicare, has informed the island’s clinical laboratories that they have to sign new contracts on or before June 1, 2022, the date on which the insurer intends to impose its new reduced rates in payments to suppliers.

“Insurers in Puerto Rico use the profit motive as unique parameters in their provider contracting management,” Trujillo noted. “This non-negotiated imposition of contractual terms and conditions, which is also a make-up management, violates the Puerto Rico Health Insurance Code and other applicable regulations. In Puerto Rico there are 630,718 subscribers to Medicare Advantage plans, of which 206,492 are beneficiaries of MCS Classicare. This means that MCS controls 33 percent of the market and of the patient population under ‘Advantage plans.’”

The ALCPR president further pointed out that “the program known as ‘Traditional Medicare’ is a federal public health program that operates on a nonprofit basis.”

“However, Medicare Advantage plans operate in Puerto Rico for profit,” she said. “The disproportionate profit motive of these insurers on the island has resulted in payments from Medicare, per patient per month, that are less than those received under the same plans in the 50 states.”

“The Government of Puerto Rico has also participated in this abusive reduction scheme,” Trujillo continued. “Encouraged by the Puerto Rico Health Insurance Administration (ASES), the insurers contracted to serve the government health plan in 2017 reduced by 30 percent the rates payable to the labs. Despite the many complaints submitted to ASES by the clinical laboratories, and despite the obligation that ASES has to supervise the contracted insurers, these illegal reductions have been sustained.”

“The Clinical Laboratories Association makes an urgent call to the offices concerned with this situation and to our legislators, so that the insurers that provide health plans in Puerto Rico are rigorously inspected,” she said. “It is time to place some emphasis and protection on the patient and the healthcare provider.”

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