‘Profits over patients cannot continue’ with VBMs; Texas testifies at health insurance hearing

May 16, 2024
As Texas defends its landmark law curbing vision benefit managers (VBMs), doctors of optometry testify at a hearing on the state’s health insurance market.
Texas flag against sky

Doctors of optometry in Texas continue serving as a voice on behalf of patients and the profession when it comes to health and vision plans.

On May 14, the Texas Senate Health and Human Services Committee held an interim hearing to examine the Texas health insurance market, and to identify barriers to accessing care that Texans face when navigating a complex health insurance market. The committee also examined the current state of access to primary health care and ways to improve that access.

Texas Optometric Association (TOA) Board of Trustees member Mary Kate Walters, O.D., testified to members of the committee about the challenges Texans continue to face when accessing eye care due to the anti-access, anti-competitive business practices of vision benefit managers (VBMs).

“Access to eye care continues to be threatened by the business practices of vision benefit managers, or VBMs,” Dr. Walters said. “The two largest VBMs have closed their panels to any new optometry practices in Texas, prioritizing their profits over patient care. Last session, H.B. 1696 was unanimously passed into law that addressed some, but not all, of the threats that VBMs pose to Texans. There is more work that must be done on this issue.”

Leveling the playing field

Texas’ first-in-the-nation vision plan reform law, H.B. 1696, is noteworthy for its unanimous legislative support in curbing recognized anti-patient, anti-competitive policies and requirements levied on optometrists by major plans and VBMs. Signed into law June 16 and having taken effect Sept. 1, H.B. 1696 has been called “groundbreaking legislation” with “first-in-the-nation” reforms. However, the law met an immediate challenge from VBMs.

In August 2023, several vision plan plaintiffs, including Visionworks of America, Inc., the National Association of Vision Care Plans, Inc., VSP, and Healthy Vision Association, filed a suit in the U.S. District Court for the Northern District of Texas, centered on the anti-steering and anti-tiering provisions prohibited by the law. The judge denied the plaintiff’s request for a temporary restraining order preventing these important provisions from going into law.

On Jan. 8, the TOA announced it had been granted the right to participate in a federal lawsuit, advocating alongside the State of Texas and Attorney General’s Office in defense of the important consumer protection provisions ushered in by H.B. 1696.

And in April, the State of Texas appealed a federal district court ruling that denied the state's motion to dismiss plaintiffs’ lawsuit and granted a temporary injunction against the law’s notable anti-steering and anti-tiering provisions. Currently, the law remains in effect, but the state is unable to enforce these two provisions. An appellate timeline has not yet been set.

‘Profits over patients cannot continue’

During the Texas Senate Health and Human Services Committee interim hearing on May 14, Dr. Walters further addressed problems that VBMs are causing in the Texas Medicaid system.

"Another serious problem exists in the Medicaid system, where VBMs are now acting as middleman subcontractors under Texas Medicaid MCOs (Managed Care Organizations),” Dr. Walters said. “The VBM is reducing provider reimbursements far below the state’s published Medicaid rate and pocketing the difference for themselves. This intrusion by VBMs in the Medicaid system is unsustainable and endangers eye care access for our most vulnerable Texans."

Tommy Lucas, O.D., TOA director of advocacy, says that VBMs should comply with all current laws in Texas; they should not attempt to restrict patient access by closing panels or try to control the doctor-patient relationship with coercive tactics.

“The legislature made clear with the unanimous passage of H.B. 1696 that the anti-competitive, monopolistic practices of the VBMs are not acceptable here." Dr. Lucas says. “VBMs should return to a patient centered focus and again partner with optometrists to deliver high-quality eye care to their customers.”

Adds Dr. Lucas: "The VBMs have chosen to sue the state of Texas in federal court with hopes of being able to continue inappropriately steering patients and tiering doctors, and on top of that, they have now closed their existing vision panels to new optometry practices at a time when access to care is at the forefront of the conversation in Texas. This is an extraordinarily poor practice that ensures everyone loses, except the VBMs."

Jennifer Deakins, O.D., TOA legislative committee chair adds, “VBMs putting profits over patients must not continue. The TOA wants vision plans to comply with the law, open their panels for doctors to join if they wish, allow patients to see the doctor of their choice without coercion, and receive the care that their optometrist recommends without coercion. VBMs need to recognize and value the care that optometrists provide to millions of Texans every year.”

 “These aren't difficult concepts but will require a course correction from the VBMs,” Dr. Deakins says. “I'm hopeful that they can recognize that the value in making these changes goes beyond their balance sheets.”

⏩ Learn more about the AOA and affiliates’ fight against VBM abuses.

Looking for even more information? Access the reports the AOA references in its health and vision plan advocacy, including:

If you or your practice experience difficulties with a health or vision plan, please report these challenges to the AOA Third Party Center at stopplanabuses@aoa.org.

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