[Note: The Senate Health and Human Services Committee will meet Thursday, December 10 at 4pm to consider the appointment of Patrick Tigue as Health Insurance Commissioner.]

We are writing to urge Rhode Islanders to call or write their state senators to ask them not to confirm Governor Gina Raimondo’s appointment of Patrick Tigue to be the next head of the Office of Health Insurance Commissioner (OHIC).  The COVID-19 pandemic has made it even more urgent to ensure that the Director of OHIC aggressively protect the public interest – not private health insurance companies.

• In his past position as RI Director of Medicaid, Mr. Tigue helped lead efforts to ensure that private health insurance companies got an increasing share of the RI budget (in 2019, $1,280,577,928 of $9.37 billion, or 13.7%)  to manage Medicaid, but never ensured they were properly monitored or audited.
  • In 2017, while Mr. Tigue was RI Director of Medicaid, the state signed 5-year contracts with “Managed Care Organizations” (MCOs), despite the fact that they overcharged RI more than $200 million in 2015 due to overstated capitation rates for the Medicaid expansion population. http://www.oag.ri.gov/reports/SA_RI_2015.pdf  (Finding 2015-002)
  • Mr. Tigue then ignored years of warnings from the RI Auditor General, including blunt statements that, “The State lacks effective auditing and monitoring of MCO financial activity.”  See, e.g., http://www.oag.ri.gov/reports/SA_RI_2018.pdf and http://www.oag.ri.gov/reports/SA_RI_2019.pdf .
  • Mr. Tigue further ignored the MCO experience of other states, like Connecticut, who expelled private insurance companies in 2012 and returned to a state run fee-for-service Medicaid program, saving hundreds of millions of dollars and improving care.  See https://www.wsj.com/articles/connecticut-moves-away-from-private-insurers-to-administer-medicaid-program-1458325696 and https://www.cga.ct.gov/2020/hsdata/od/Medicaid%20101-DSS%20Presentation.pdf.  See also https://www.inthepublicinterest.org/wpcontent/uploads/ITPI_PrivatizingVAMedicaid_March2018.pdf and https://tarbell.org/2019/04/iowa-privatized-medicaid-it-has-been-a-disaster-heres-why/  (describing MCO failures in Kansas and Iowa).
  • Mr. Tigue also did not undertake actions to ensure that Medicaid MCOs were meeting parity laws that require mental health coverage at least equal to coverage provided for other health conditions.  Compare to NY.https://health.ny.gov/health_care/managed_care/reports/docs/2019-04-18_rpt.pdf and Massachusetts https://webcache.googleusercontent.com/search?q=cache:5wRqEHDUyzoJ:https://www.mass.gov/doc/chapter-224-mental-health-parity-report-july-2018-0/download+&cd=2&hl=en&ct=clnk&gl=us
  • As RI Director of Medicaid, Mr. Tigue should have pursued an audit of MCOs and analyzed the true costs and benefits to Rhode Islanders that resulted from abandoning its state-run program, but he did not.  See https://3e93ac45-5711-428b-a0e2-e1754d9001b9.filesusr.com/ugd/f4ce4b_adf443f8bc144114a4bced7cc41edf69.pdf and http://www.eohhs.ri.gov/Portals/0/Uploads/Documents/1115Waiver/Proposed1115WaiverExtensionRequest032318.pdf
  • Instead, Mr. Tigue offered unsubstantiated claims about how MCOs would “compete against one another on the basis of quality, to ensure that they serve people well.” http://newsletter.convergenceri.com/stories/next-stop-wonkville,3962

• As Director of Medicaid, Mr. Tigue failed to protect Rhode Island’s most vulnerable populations, including by:
  • Seeking to purge 20,000 “ineligible individuals” from Rhode Island’s Medicaid rolls over four months and causing unjustified loss of coverage that resulted in litigation.  See https://www.wpri.com/health/ri-aims-to-kick-20000-off-medicaid-by-august/ and https://www.providencejournal.com/news/20190110/aclu-reaches-settlement-with-ri-in-medicaid-dispute.
  • Overseeing budget cuts that included raising co-pays for medicines needed by low-income Rhode Islanders, hiring private consultants to find ways to deny care to seriously ill patients, cutting funding to nursing homes and increasing MCO payments.  See https://www.providencejournal.com/news/20180118/co-pays-proposed-as-part-of-166m-in-medicaid-cuts, https://www.providencejournal.com/news/20180611/reaction-to-ris-96b-budget-proposal-bad-for-nursing-homes-some-good-news-for-kids, and http://omb.ri.gov/documents/Prior%20Year%20Budgets/Operating%20Budget%202018/BudgetVolumeII/0_Complete%20Volume%20II%20-%20Health%20and%20Human%20Services.pdf
  • Failing to address multi-payer problems that helped lead to Memorial Hospital’s financial collapse and to the $50 million deficit posted by Lifespan this year as their hospitals absorbed Memorial’s “poor payer-mix” patients.  See https://upriseri.com/2019-01-22-j-mark-ryan/

• Mr. Tigue, with his record of unwavering support for private health insurers, should not run a state commission that has conflicting goals and already demonstrates prioritizing the interests of private health insurers over patients. OHIC’s mission is to:
  • Guard the solvency of health insurers;
  • Protect the interests of consumers; … http://webserver.rilin.state.ri.us/Statutes/title42/42-14.5/42-14.5-2.HTM
  • Since COVID-19, OHIC allowed private insurers to raise premiums despite the fact that private insurance companies have enjoyed increased profits and the RI Attorney General publicly criticized this action.  See https://www.kff.org/private-insurance/issue-brief/health-insurer-financial-performance-amid-the-coronavirus-pandemic/  and https://pbn.com/ohic-approves-2021-health-insurance-rates-ag-neronha-slams-rate-increases/
  • OHIC has not enforced parity laws as aggressively to benefit consumers as Attorneys General in other states.  See e.g., http://www.ohic.ri.gov/documents/OHIC-Report-on-Behavioral-Health-Parity-Final-Version.pdf, and http://www.ohic.ri.gov/documents/2018-Examination-Report-BCBSRI (BCBSRI agrees to make in lieu of any further penalties, a $5 million contribution spread over 5 years to the Rhode Island Foundation to support improving the behavioral health system and submit policies and procedures to remedy OHIC identified violations).  Compare to Massachusetts Attorney General enforcement actions, e.g., https://www.mass.gov/doc/allways-aod/download (AllWays ordered to track and monitor member complaints concerning its provider networks, including complaints alleging untimely access to care, date such complaint was submitted, date such complaint was closed, and a record of actions taken in response to such complaint).
  • OHIC has touted as one of its major achievements helping put a “reinsurance program” in the state budget despite the fact that reinsurance simply keeps insurance companies viable using taxpayer dollars to subsidize the cost of care for the most expensive (sicker) patients, leaving insurance company profits intact.  See http://www.ohic.ri.gov/documents/2019/September%202019/Rhode%20Island%20Health%20Insurance%20Premiums%20Significantly%20Reduced%20for%202020.pdf and https://pnhp.org/news/is-reinsurance-the-solution/
  • OHIC claims to help manage an “all-payer claims database,” which in fact does not cover a significant portion of payer claims and therefore, is not able to provide useful data about all Rhode Island health insurance claims.  See https://health.ri.gov/materialbyothers/RIAllPayerClaimsDatabaseTechnicalSpecificationsManual.pdf
  • OHIC is currently in the final stages of an alarming major overhaul of its “Affordability Standards” regulations which essentially seek to transform the delivery of medical care in the state from a fee for service system to a capitated system.  See OHIC position papers here and here.
    • Capitation has never been shown to improve quality of care and necessarily pits the financial interests of physicians against those of their patients because it creates a financial incentive for providers to get rid of patients who are non-compliant or unable to achieve the “quality measures” that are tied to their reimbursement.  Providers should not be encouraged to do what is currently practiced by all private insurance companies and is referred to as “cherry picking” and “lemon dropping.”  https://www.ncbi.nlm.nih.gov/pmc/articles/PMC4880224/
    • Widely practiced by HMOs in the 1990s, capitation was an utter failure and an enormous distraction from the actual causes of the rising costs of care:  insurance company overhead and pharmaceutical industry profits.  These two sources of waste consume 1/3 of every health care dollar spent by the US and a primary reason to remove private insurance companies from being expensive “middlemen” – not “protect” their “solvency.”  https://pnhp.org/news/managed-cost-mismanaged-care/

For the foregoing reasons, we ask you NOT TO CONFIRM Patrick Tigue as the next Commissioner of OHIC. If you have any questions, please feel free to contact us at [email protected].

Thank you for considering our request.  

Yours truly,

• J. Mark Ryan, MD, FACP, Chair, Physicians for a National Health Program – RI Chapter (PNHP-RI)
• James A. Cowan, MD, MPH, Board member, PNHP-RI
• Linda Ujifusa, Co-chair, RI Healthcare Access & Affordability Partnership