Recent Publications
April 29, 2009
The Ohio Healthcare Simplification Act: Impact on “All Products” and “Most Favored Nations” Clauses
Thomas
D.
Anthony
The Ohio Healthcare Simplification Act (HB 125) was signed into Ohio law on March 25, 2008 as
ORC Section 3963 and was enacted to achieve two main goals: (1) to improve the contracting process between healthcare providers and insurers and (2) to standardize the credentialing process that insurers require of healthcare providers.
The Act now prohibits the use of “all products” clauses that force healthcare providers to participate in all of an insurer’s products. It also prohibits an insurer from forcing a healthcare provider to accept its future product offerings. However, if the healthcare provider refuses to participate in any new product offered by the insurer, the insurer may terminate the participating healthcare provider upon written notice to the provider, effective 180 days after the refusal. Additionally, insurers may not prohibit participating healthcare providers from entering into a healthcare contract with any other insurer, nor may healthcare providers prohibit insurers from contracting with other healthcare providers.
Additionally, beginning in 2011, the Act prohibits the use of most favored nation (MFN) clauses that force physicians and other providers (excluding hospitals) to provide healthcare services at a lower price than originally called for in the contract. An insurer also may not amend a contract with a healthcare provider, (except hospitals), to include a MFN clause. Under the Act, hospitals may continue to be subject to MFN clauses. The Act also imposes a two-year moratorium on the use of MFN provisions that began June 25, 2008. During the moratorium, no healthcare contract with a MFN clause may be entered into, renewed, or amended to include a MFN clause, except for contracts with hospitals that are already in existence on the effective date of the Act and already contain a MFN clause at that time.
If you have any questions about the implication of this recent legislation, please contact Tom Anthony (513-651-6191) or , Marisa Schroder (513-651-6804) or or any other attorney in our
Corporate/Business Practice Group.