Anthem Blue Cross, a subsidiary of Indianapolis-based WellPoint Inc., and Blue Shield of California misled customers about the number of doctors in their networks under health plans sold through California's insurance marketplace, according to a state report released Tuesday.
The California Department of Managed Health Care began investigating in May after patients complained they were told that certain medical providers were included when they chose a health plan, only to find out after their appointment that their doctor was not part of their network. Seeing an out-of-network doctor increases costs significantly for patients.
About 200 complaints were filed against the companies earlier this year based on plans sold through Covered California, the entity created to carry out the provisions of the federal Affordable Care Act. Anthem and Blue Shield are two of the largest health insurers in California.
The department cited the insurers for various deficiencies in how they publicized their physician networks. It found the insurers' online provider directories listed physicians that were outside their networks and that they failed to correct inaccuracies. They issued statements "that were either untrue or misleading and which were disseminated, at least in part, for the purpose of inducting persons to enroll in the plan."
Anthem and Blue Shield say the state's survey is flawed and noted that doctors were not obligated to participate in the survey. The insurers said there is often confusion within doctors' offices about which health plans they accept.
The state "relied on an unsound methodology to obtain its raw data, and then made misleading and inappropriate conclusions based on inaccurate data," Anthem wrote in its response to the state's findings.
Both insurers have acknowledged they made mistakes but say they have tried to fix them and have added thousands of new providers. Anthem spokesman Darrel Ng said the health plan followed up with the doctors who said they didn't accept the plan and found that 99 percent had contracts with the insurer.
"We're not saying that everything is perfect," he said. "We've taken great steps to try to remedy that situation."
There are 10 private health plans selling on the exchange. Together, Anthem Blue Cross and Blue Shield of California accounted for nearly 58 percent of those who signed up the first year.
The state said that while it understands the insurers' concerns, "they do not change the fact that the significant inaccuracies contained in the plan's online provider directory resulted in a highly unacceptable customer experience, nor do they change the fact that California consumers could not reach or did not have access to providers who were represented as being part of the plan's network."
Its investigation found that 18.2 percent of doctors listed in Blue Shield's directory were not at the location listed for them, and nearly 9 percent of doctors were not willing to accept the Covered California plans. Despite follow-up calls by its investigators, the state found that just 57 percent of the 1,360 plan providers were available to Covered California enrollees.
In the case of Anthem, 12.5 percent of doctors were not at the address listed for them, while 12.8 percent were not willing to accept the plans purchased on the exchange. The survey also found that only about 60 percent of the 3,272 plan providers were available to Covered California enrollees.
The state will conduct a follow-up survey in six months, and the department's enforcement arm can take corrective action if needed. Both Anthem and Blue Shield have resubmitted updated provider lists.
One consumer advocate called for fines and tough enforcement against the insurers.
"The results of the investigation of these insurers are deeply troubling," said Anthony Wright, executive director of Health Access California, a health care advocacy group. "If significant numbers of doctors listed aren't where the insurers say they are, that's a big violation of trust to premium-paying patients."
Open enrollment began Nov. 15 and runs through Feb. 15. The state's exchange has set a target of enrolling 1.7 million people for private health coverage next year, which would include re-enrolling the 1.1 million people who signed up during the first season.
Peter Lee, executive director of Covered California, said the exchange will continue to work with the two health plans, network doctors and physician support staff to stay informed about individual plans.
"We're really confident as we go into the second round of open enrollment that they are not changing networks, where we've got some stability," Lee said. "We're going to actually be much better off in terms of consumers having a clear understanding about who's in, and being able to make the informed choices we want consumers to make."