An Alaska judge is backing the state\u2019s decision to repeal a longstanding rule that was meant to keep down health care costs in the state.<\/p>\n
Under the 80th percentile rule, which was repealed<\/a> by the administration of Gov. Mike Dunleavy in January 2024, insurance companies were required<\/a> to pay out-of-network providers at least the 80th percentile of the average going rate for a medical service. <\/p>\n The rule prevented Alaska patients from receiving large medical bills for out-of-network care. But the Dunleavy administration and the state\u2019s biggest insurance company, Premera Blue Cross Blue Shield of Alaska, argued<\/a> the rule also increased the cost of health care over time.<\/p>\n The repeal was broadly opposed by dozens of health care providers across the state, who said the removal of the rule will make it harder for them to stay afloat while benefiting insurance companies that are headquartered in the Lower 48. <\/p>\n If insurance companies significantly lower their reimbursement rates, providers said, keeping their doors open may no longer pencil out.<\/p>\n A coalition of providers sued in late 2023 to keep the rule in place, arguing that the Division of Insurance had not sufficiently proven that the rule was responsible for increases in the cost of health care in Alaska.<\/p>\n The case went to trial in February. Late last month, Anchorage Superior Court Judge Yvonne Lamoureux ruled in favor of the state<\/a>.<\/p>\n \u201cThe evidence at trial established the Division (of Insurance) did not make the repeal decision lightly,\u201d Lamoureux wrote in her ruling, concluding that the repeal was \u201cnot unreasonable or arbitrary.\u201d <\/p>\n In a statement, Dr. John Morris, an anesthesiologist who spearheaded the lawsuit on behalf of the health care providers, said the coalition is \u201cdisappointed with the ruling.\u201d<\/p>\n \u201cEach year insurers pay physicians and healthcare providers less for the same care but somehow also blame doctors for rising health insurance costs,\u201d Morris said. \u201cWe remain committed to bringing health care costs down while making sure our seniors and veterans have a doctor to see. This ruling doesn\u2019t help.\u201d<\/p>\n The Division of Insurance had considered repealing the rule for over a decade as part of its efforts to address rising health care costs in Alaska. Premera, an insurance company that controls a large share of Alaska\u2019s individual insurance market, was strongly in favor of the repeal. <\/p>\n Former Division of Insurance Director Lori Wing-Heier previously indicated that repealing the rule would lead to a reduction in Premera\u2019s premium rates by between 2% and 3%.<\/p>\n