PART 3. SURPRISE MEDICAL BILLS. “I was never in a position to preselect who (would) perform my heart transplant,” (and if the physicians and surgeons were in network)….because I did not know when a new heart would become available.

New PART 3 after PARTS 1&2

PART 1. July 29, 2018. SURPRISE MEDICAL BILLS. Write in AS LONG AS THE PROVIDERS ARE IN MY NETWORK…before you sign any hospital admission documents accepting financial responsibility for your care.

PART 2. May 20, 2019. OUT-OF-NETWORK BILLS. Private Equity is a Driving Force Behind Devious Surprise Billings

PART 1. July 29, 2018. SURPRISE MEDICAL BILLS. Write in AS LONG AS THE PROVIDERS ARE IN MY NETWORK…before you sign any hospital admission documents accepting financial responsibility for your care.

“No Surprise Charges” is one of the key Lessons Learned in Elisabeth Rosenthal’s fabulous new book AN AMERICAN SICKNESS (Penguin Press, 2017). “Hospitals in your network should also be required to guarantee that all doctors who treat you are in your insurance network.”

We have all harshly experienced or heard about under-the counter out-of-network hospital charges:

“A Kaiser Family Foundation survey finds that among insured, non-elderly adults struggling with medical bill problems, charges from out-of-network providers were a contributing factor about one-third of the time. Further, nearly 7 in 10 of individuals with unaffordable out-of-network medical bills did not know the health care provider was not in their plan’s network at the time they received care.”(A)

A study that looked at more than 2 million emergency department visits found that more than 1 in 5 patients who went to ERs within their health-insurance networks ended up being treated by an “out-of-network” doctor – and thus exposed to additional charges not covered by their insurance plan.” (B)

Here is a brief case study:

“When Janet Wolfe was admitted to the hospital near Macon, Georgia, a few years ago, her lungs were functioning at just one-fifth their normal capacity. The problem: graft-versus-host disease, a complication from a stem cell transplant she received to treat lymphoma. Over the course of three days she saw three different doctors. Unbeknownst to Janet and her husband, Andrew, however, none of them was in her health plan’s network of providers. That led the insurer to pay a smaller fraction of those doctors’ bills, leaving the couple with some hefty charges.” (C)

So what can you do to avoid out-of-network charges?

– Speak with a practice representative before being seen to understand the costs of seeing your doctor on an out-of-network or a cash basis. (DOCTOR note: maybe you need to leave and go to an in-network physician instead)

– If you need additional services, such as surgery, imaging or physical therapy, ask your doctor to refer you to an in-network facility to keep your costs down. (D)

A New York law is a great start toward transparency to reduce out-of-network surprises.

Under a recent New York law, Hold Harmless Protections for Insured Patients, “… patients are generally protected from owing more than their in-network copayment, coinsurance or deductible on bills they receive for out-of-network emergency services or on surprise bills.

A bill is considered a surprise if consumers receive services without their knowledge from an out-of-network doctor at an in-network hospital or ambulatory surgical center, among other things. In addition, if consumers are referred to out-of-network providers but don’t sign a written consent form saying they understand the services will be out of network and may result in higher out-of-pocket costs, it’s considered a surprise bill.” (E)

“Advocates for patients, senior citizens, labor unions, and businesses hailed Gov. Phil Murphy’s signing of a complex and controversial measure designed to curb the impact of costly “surprise” medical bills in New Jersey. Supporters said the law, nearly 10 years in the making, is the strongest of its kind nationwide…

The Democratic governor, who pledged his support for the bill in March, said the law closed a loophole to protect patients and make healthcare more affordable; sponsors called it the right thing to do to protect vulnerable residents. “We have put patients first. We have made clear that New Jersey stands for transparency when it comes to health care,” …

The reform is designed to protect patients, businesses, and others who pay for medical care from the high-cost bills associated with emergency or unintentional care from doctors or other providers who are not part of their insurance network. The law requires greater disclosure from both insurance companies and providers – so patients are clear on what their plan covers – ensures patients aren’t responsible for excess costs, and establishes an arbitration process to resolve payment disputes between providers and insurers, a mechanism intended to better control costs…

“It’s a solution that is fair to healthcare providers and consumers alike because it strikes a balance between providing reasonable compensation to facility-based providers, while protecting consumers from unexpected, nonnegotiable bills that drive health insurance premiums higher,” said NJBIA president and CEO Michele Siekerka. “This was an extremely difficult and complicated issue, and NJBIA commends the governor and the bill sponsors who worked hard to address the concerns of all stakeholders.”” (F)

A price transparency RFI released by the agency this week asks for input on how CMS might develop consumer-friendly policy. In a request for information announced Thursday, the Centers for Medicare & Medicaid Services asked whether providers and suppliers should be required to tell patients, in advance, how much a given healthcare service will cost out-of-pocket. If the agency were to move forward with a price transparency requirement on physician practices, it could prove controversial. Many doctors say they themselves lack the training they would need to have effective conversations about how much the healthcare services they provide will ultimately cost patients.

But CMS has repeatedly indicated that it aims to get more pricing information to consumers one way or another. “We are concerned that challenges continue to exist for patients due to insufficient price transparency,” the agency wrote in its RFI, which is included in proposed revisions to the Physician Fee Schedule, Quality Payment Program, and other policies for 2019…

In order to determine what additional actions may be appropriate to connect consumers with accessible price information, the CMS price transparency RFI includes a variety of questions, including the following: How should the phrase “standard charges” be defined in various provider and supplier settings?

Which information types would be most useful to beneficiaries, and how can providers and suppliers empower consumers to engage in price-conscious decision-making?

Should providers and suppliers have to tell patients how high their out-of-pocket costs are expected to be before providing a service?” (G)

“Patients are at a higher risk of receiving surprise medical bills on Affordable Care Act exchanges, according to a new report.

In 2018, more than 73% of plans available in the exchange marketplace offered restrictive networks, compared with 48% in 2014, according to the report (PDF) commissioned by Physicians for Fair Coverage. PFC is a nonprofit alliance of physician groups which advocates for ending surprise insurance gaps and improving patient protections…

“This research confirms what patients and physicians across the country have known for some time,” said PFC President and CEO Michele Kimball in a statement. “Insurers have been systematically narrowing their networks and increasing premiums, creating surprise insurance gaps that patients don’t realize exist until it’s too late. While insurers are making record profits, patients are paying more for less.”

The coalition, which includes tens of thousands of emergency physicians, anesthesiologists and radiologists from across the country, is pressing for more states to adopt legislation to solve the problem of surprise medical bills. The problem often occurs when a patient seeks care at an in-network hospital but is then surprised the doctor treating them is out of their insurance company’s network-a fact they usually find out when they get the doctor’s bill.

“When it comes to health care, nobody likes a surprise. This study confirms what we’ve been hearing from patients for years: there is no real way for patients to avoid a ‘surprise’ medical bill, even when they’re insured and try to stay in-network. We need a transparent healthcare system designed for patients, not profits,” Rebecca Kirch, executive vice president of healthcare quality and value at the National Patient Advocate Foundation, said in a statement…

The best estimates indicate that 1 out of 7 times someone goes to the emergency department, they are going to be stuck with a surprise bill.” (H)

A patient came to see me with lower abdominal pain. Was she interested in my medical opinion? Not really. She was told to see me by her gynecologist who had advised that the patient undergo a hysterectomy. Was this physician seeking my medical advice? Not really. Was this patient coming to see me as her day was boring and she needed an activity? Not really. After the visit with me, was the patient planning to return for further discussion of her medical status? Not really.

So, what was going on here. What had occurred that day was the result of an insurance company practice that I had thought had been properly interred years ago.

The woman had pelvic pain and consulted with her gynecologist. An ultrasound found a lesion within her uterus. A hysterectomy was advised. The insurance company directed that a second opinion be solicited. A second gynecologist concurred with the first specialist. The patient advised me that the insurance company wanted an opinion from a gastroenterologist that there was no gastrointestinal explanation for her pain. In other words, they did not want to pay for a hysterectomy that they deemed to be unnecessary.

How should we respond? (I)

“In the absence of laws barring balance bills and surprise bills, there are steps hospitals and health plans can take to protect consumers from medical debt. The Healthcare Financial Management Association urges hospitals to inform patients that they may be eligible for financial assistance provided directly by the hospital and make clear to patients what services are and are not included in their price estimates. Hospitals also need to communicate better with uninsured patients about medical costs and options for sharing costs..

Health plan best practices include helping members estimate expected out-of-pocket costs and sharing price information for providers in a given region.

Beyond that, hospitals need to double down to ensure they have contracts with as many in-network providers as possible. “It requires the physicians, hospitals, health plans all working together to make sure that everybody’s in-network or, if they’re not, the patient knows that clearly up front,” says Rick Gundling, HFMA’s senior vice president for healthcare financial practices. “It’s kind of a three-legged stool.”

Consumers also need to become savvier when it comes to costs of medical care. Most people do see providers in their network, says Gupta. However, “because of their high-deductible health plan, they often don’t recognize until they get hit with a bill that the same MRI might be $3,000 after the deductible at a local hospital that is convenient for them versus $1,000 a mile down the street at an imaging center,” he adds.” (J)

“Cooper works as a physician assistant and hears about medical billing problems all the time.

So when she initially found out she was pregnant, this health care provider did everything she could to make sure anyone associated with her pregnancy would be considered what’s referred to as “in-network.”

She contacted her insurance company, Aetna, and she also contacted Banner Gateway Hospital, the hospital where she planned to give birth. The hospital then sent her written confirmation that she had nothing to worry about.

“She said, ‘Send me a picture of your insurance card front and back and I’ll double check that you’re covered.’ And, she sent me back an hour later saying, ‘Yes, you are in network,'” Cooper said.

Cooper eventually delivered her little girl at Banner Gateway Hospital. But, not long after, Cooper started getting a number of large “out-of-network” medical bills.

“Aetna then sent me back something that said, ‘No you are out-of-network’ and that’s how everything started to trickle through,” she said.

“Out-of-network.” How could that happen? Remember, she got written confirmation from Banner Gateway Hospital indicating she was “in-network.”…

When she added them all up, her medical bills came to around $18,000, money she shouldn’t have been responsible for. Still, she says she wasn’t getting any resolution…

We asked them to review Cooper’s case and after they did, they acknowledged there was a mistake.

As a result, Aetna reprocessed all of Heather’s bills as “in-network.”..

That means Cooper will now only have to pay just $750 out of pocket, the cost of her deductible rather than $18,000. Cooper said she couldn’t be happier and says it all happened with the help of 3 On Your Side.” (K)

“On the first morning of Jang Yeo-im’s vacation to San Francisco in 2016, her eight-month-old son Park Jeong-whan fell off the bed in the family’s hotel room and hit his head.

There was no blood, but the baby was inconsolable. Jang and her husband worried he might have an injury they couldn’t see, so they called 911, and an ambulance took the family – tourists from South Korea – to Zuckerberg San Francisco General Hospital.

The doctors at the hospital quickly determined that baby Jeong-whan was fine – just a little bruising on his nose and forehead. He took a short nap in his mother’s arms, drank some infant formula, and was discharged a few hours later with a clean bill of health. The family continued their vacation, and the incident was quickly forgotten.

Two years later, the bill finally arrived at their home: They owed the hospital $18,836 for the 3 hour and 22 minute visit, the bulk of which was for a mysterious fee for $15,666 labeled “trauma activation,” which sometimes is known as “a trauma response fee.”

Update: After this story was published on June 28, Zuckerberg San Francisco General Hospital agreed to waive the $15,666 trauma response fee charged for Park Jeong-whan’s visit to the hospital. In a letter, the hospital’s patient experience manager said the hospital did a clinical review and offered “a sincere apology for any distress the family experienced over this bill.” Further, the hospital manager wrote that the case “offered us an opportunity to review our system and consider changes.” (L)

“The health insurer Anthem is coming under intense criticism for denying claims for emergency room visits it has deemed unwarranted…

The insurer initially rolled out the policy in three states, sending letters to its members warning them that, if their emergency room visits were for minor ailments, they might not be covered. Last year, Anthem denied more than 12,000 claims on the grounds that the visits were “avoidable,” according to data the insurer provided to Senator Claire McCaskill, a Democrat from Missouri, one of the affected states.

But when patients challenged their denials, Anthem reversed itself most of the time, according to data the company gave Ms. McCaskill. The report concludes that the high rate of reversals suggests that Anthem did not do a good initial job of identifying improper claims, meaning some patients who did not challenge their denials may have been stuck paying big bills they should not have been responsible for.” (M)

  1. A.Surprise Medical Bills by Karen Pollitz, kkf.org, http://kff.org/private-insurance/issue-brief/surprise-medical-bills/
  2. B.Many get hit with surprise ‘out-of-network’ bill after emergency rooms: Study” by Dan Mangan, CNBC, http://www.cnbc.com/2016/11/16/many-get-hit-with-surprise-out-of-network-bill-after-emergency-rooms-study.html
  3. C.When Out-Of-Network Charges Pop Up, Try An Appeal, by Michelle Andrews, NPR, http://www.npr.org/sections/health-shots/2011/06/21/137304710/when-out-of-network-charges-pop-up-try-an-appeal
  4. D.What It Means If Your Doctor is Out of Network, by Sergio Viroslav, Angie’s list, https://www.angieslist.com/articles/what-it-means-if-your-doctor-out-network.htm
  5. E.N.Y. Law Offers Model For Helping Consumers Avoid Surprise Out-Of-Network Charges by Michelle Andrews, KHN http://khn.org/news/n-y-law-offers-model-for-helping-consumers-avoid-surprise-out-of-network-charges/
  6. F.Governor Signs Nation’s Strongest Law on ‘Surprise’ Medical Bills, by Lilo H. Stainton, https://khn.org/news/n-y-law-offers-model-for-helping-consumers-avoid-surprise-out-of-network-charges/
  7. G.SURPRISE MEDICAL BILLS: SHOULD CMS MAKE DOCTORS GIVE PRICE INFO UP FRONT?, by STEVEN PORTER, https://khn.org/news/n-y-law-offers-model-for-helping-consumers-avoid-surprise-out-of-network-charges/
  8. H.Patients on ACA plans at higher risk for surprise bills, physician coalition says, by Joanne Finnegan, https://www.fiercehealthcare.com/practices/aca-exchanges-restrictive-networks-surprise-bills-physicians-for-fair-coverage
  9. I.Let’s tell the truth about what’s going on, by Michael Kirsch, https://www.medpagetoday.com/blogs/kevinmd/74070?xid=nl_mpt_hemoncvideo_2018-07-20&eun=g1223211d0r&pos=9&utm_source=Sailthru&utm_medium=email&utm_campaign=Daily%20Headlines%202018-07-20&utm_term=Daily%20Headlines%20-%20Active%20User%20-%20180%20days
  10. J.Some patients fight back against surprise medical bills, by Meg Bryant, https://www.healthcaredive.com/news/some-patients-fight-back-against-surprise-medical-bills/526576/
  11. K.Gilbert mom fighting medical bills she says she shouldn’t owe, by LiAna Enriquez, http://www.azfamily.com/story/38722098/gilbert-mom-fighting-medical-bills-she-says-she-shouldnt-owe
  12. L.A baby was treated with a nap and a bottle of formula. His parents received an $18,000 bill, by Jenny Gol and Sarah Kliff, https://www.vox.com/2018/6/28/17506232/emergency-room-bill-fees-health-insurance-baby
  13. M.A Health Insurer Tells Patients It Won’t Pay Their E.R. Bills, but Then Pays Them Anyway, https://www.nytimes.com/2018/07/19/upshot/anthem-emergency-room-bills.html?utm_source=STAT+Newsletters&utm_campaign=24e499fa7a-MR_COPY_09&utm_medium=email&utm_term=0_8cab1d7961-24e499fa7a-149527969

PART 2. Private Equity is a Driving Force Behind Devious Surprise Billings,

I thought I was a good OUT-OF-NETWORK detective and could avoid SURPRISE MEDICAL BILLS. Not so! Recently I switched physicians within a sub-specialty practice group. The first MD took my Medicare “GAP” insurance but the second did not. This lesson already cost me $1,000 versus an in network cost of probably $200. One can never be too vigilant!

“The expectant mother was in labor at South Shore Hospital when she requested a common pain medicine, which was administered by an anesthesiologist. Home with a newborn days later, she was surprised when a bill arrived from the doctor’s group for $2,143.44.

Another patient who went to Emerson Hospital’s emergency department for what turned out to be a broken rib also received a surprise bill: $300.91, for the services of the doctor who read the X-ray…

Patients should not have to “contact their health plan and complain,” said David Seltz, executive director of the Massachusetts Health Policy Commission, which monitors health care spending in the state. “Through no fault of their own they are being put in this situation.”

An analysis by the policy commission found that 10,000 Massachusetts patients in just one year may have received surprise bills for so-called out-of-network care, and policy experts believe that figure underestimates the extent of the problem…

More than 35 percent of complaints filed with Healey were over out-of-network charges, which can be up to 200 percent higher than what insurers pay in-network doctors. Among the physicians that were outside the patients’ insurance networks were anesthesiologists assisting in colonoscopies and emergency medicine doctors repairing broken bones and treating heart attacks, something that frustrated patients told Healey’s office they had no way of knowing in advance. Radiologists and pathologists also directly billed patients out-of-network charges.

It’s not unusual for a hospital to have practitioners working in their facilities who are not covered by all their agreements with insurers, a technicality that is often not apparent to patients.” (A)

” (Trump)” In my State of the Union address, I asked Congress to pass legislation to protect American patients. For too long, surprise billings – which has been a tremendous problem in this country – has left some patients with thousands of dollars of unexpected and unjustified charges for services they did not know anything about and, sometimes, services they did not have any information on. They weren’t told by the doctor. They weren’t told by the hospitals in the areas they were going to. And they get, what we call, a “surprise bill.” Not a pleasant surprise; a very unpleasant surprise.

So this must end. We’re going to hold insurance companies and hospitals totally accountable.” (B)

“But physician advocacy groups, including the American Medical Association (AMA) while applauding the effort to eliminate surprise bills, expressed some concern that a simplified approach to a complex problem could have unintended consequences for healthcare delivery…

“We agree with the president that patients should not be responsible for coverage gaps and for any costs beyond their in-network cost sharing when they do not have an opportunity to choose an in-network physician,” said Barbara L. McAneny, MD, AMA’s president in a statement. “We also agree that physicians and hospitals should be transparent about their costs, and payers should offer transparency about their networks, scope of coverage, and out-of-pocket costs. In addition, insurers should be held accountable for their contributions to the problem and ensure network adequacy, adherence to the prudent layperson standard for emergency care in current law, and reasonable cost-sharing requirements.”” (C)

“Reps. Frank Pallone (D-NJ) and Greg Walden (R-OR), the top Democrat and Republican on the House Energy and Commerce Committee, have jointly released a draft bill that would prevent patients from facing unexpected charges after they go to the emergency room or receive other non-emergency medical care…

The Pallone and Walden bill takes a multi-pronged approach to ending surprise medical bills:

Health insurers would be required to treat out-of-network emergency care as in network for their enrollee’s cost-sharing and out-of-pocket obligations. So patients wouldn’t have to pay any more for receiving emergency treatment at an out-of-network hospital than they would at an in-network one.

Balance billing – when a health care provider sends a patient a bill charging them whatever the difference is between the price set for a service by the provider and the price the health insurer is willing to pay – would be prohibited.

Insurers would have to make a minimum payment to out-of-network providers for their enrollee’s care, based on the price the insurer pays to nearby in-network providers… (D)

“These protections would apply to all out-of-network emergency services and to all out-of-network nonemergency services received at an in-network facility from “facility-based providers,” which the bill defines to include anesthesiologists, radiologists, pathologists, neonatologists, assistant surgeons, hospitalists, intensivists, and any additional provider types specified by the Secretary of Health and Human Services (HHS). Other provider types would still be allowed to treat patients on an out-of-network basis in nonemergency situations if they met the strong notice and consent requirements detailed in the discussion draft. Limiting notice and consent exceptions to physician specialties that patients typically actively choose strikes a sensible balance. It preserves patients’ ability to seek out-of-network care in circumstances where it is appropriate, while mitigating the risk that the flood of paperwork involved in seeking medical care will result in some patients consenting to out-of-network billing without understanding what they are consenting to or whether they have a reasonable alternative.” (E)

“A new draft bill released this morning sets up a so-called “baseball-style” arbitration process for providers and plans as an option to settle payment disputes, POLITICO’s Rachel Roubein writes. Today’s draft comes after Sens. Bill Cassidy (R-La.), Michael Bennet (D-Colo.) and four others spent eight months refining legislation first introduced in September. More for Pros.

– Today’s legislation prohibits balance billing in three instances, Rachel writes. (1) For emergency care, (2) during elective care at an in-network facility but when a service is performed by an out-of-network provider and (3) when a patient needs additional medical care after an emergency at an out-of-network facility but can’t travel elsewhere.

– The most contentious part of addressing surprise medical bills: the payment. Under the new bill, providers would automatically be paid the median in-network rate. But they can dispute that, initiating a so-called “baseball-style” arbitration process, where mediators will base decisions on “commercially reasonable rates” (the in-network rates for that area and not actual charges).” (F)

“The House of Representatives and the Senate have unveiled dueling legislation aimed at surprise billing, and the two are split on one key element: arbitration.

The House bill (PDF), which was introduced earlier this week by Reps. Frank Pallone, D-New Jersey and Greg Walden, R-Oregon, would require insurers to cover out-of-network emergency care at in-network rates and would ban balance billing.

Balance billing most often occurs in emergency departments or during elective surgery, when a patient goes to an in-network facility but is treated by an out-of-network clinician, typically an anesthesiologist or radiologist.

The Senate’s bill, however-which is backed by Sens. Bill Cassidy, R-Louisiana, and Maggie Hassan, D-New Hampshire-would include a “baseball-style” arbitration program to mitigate disputes, alongside similar elements to the House iteration.” (G)

“The administration said its top priority is to make sure patients no longer receive separate bills from out-of-network doctors, an approach known as a “bundled payment.”..

Vidor Friedman, president of the American College of Emergency Physicians, said a bundled payment puts too much pressure on hospitals to contract with physicians, essentially making hospitals take on the role of insurer.

“It would create another layer between the patient and providers of care,” Friedman said, noting that doctors would need to negotiate directly with hospitals for payment, rather than with insurance companies…

Instead, doctors and hospitals want an independent arbitrator to examine the amount the doctor is charging and what the insurer is agreeing to pay – and then determine which one is fairer…

But insurers are opposed to arbitration, and they’re pushing for Congress to set reimbursement rates.

In a letter to House and Senate leaders in March, America’s Health Insurance Plans urged lawmakers to “avoid the use of complex, costly and opaque arbitration processes that can keep consumers in the middle and lead to higher premiums.”

The White House also threw cold water on arbitration. During a briefing with reporters on Thursday, administration officials called arbitration an “unnecessary distraction.”..

“Providers point fingers at payers, payers point fingers at providers, and the American people are left really getting the shaft,” a senior administration official said.

The White House and lawmakers have been warning all the players to solve the problem on their own. But now with pressure from the White House, Congress is likely to act.

“There will come a point in time when they want to move a solution forward,” AHA’s Smith said. “It’s unlikely you’ll come to a solution where every one of the stakeholders is happy.”” (H)

“One of the major drivers of surprise bills is the deliberate decision by health insurance plans to narrow the networks of providers available to their insureds-core network adequacy requirements should be an essential component of any solution,” AMA Executive Vice President and CEO James L. Madara, MD, wrote in the letters to committee leaders. “Shrinking networks increase the likelihood that patients may receive care from an out-of-network provider, particularly in emergency situations.”

..Patients are shouldering more of the costs through larger deductibles and higher copays. The median out-of-network deductible for individual marketplace is $12,000 and almost a third of individual market plans have deductibles of more than $20,000 according to research by the Robert Wood Johnson Foundation cited in the letter.

“Limited networks of providers and unaffordable deductibles for care outside those networks can expose patients to high out-of-pocket costs,” Dr. Madara wrote.

..Often insurance companies will use tactics such as prior authorization or “fail-first” step therapy protocols to make patients pay out of pocket for medically necessary treatment they refuse to cover.

.. Despite federal mental health-parity requirements, patients can feel squeezed by their health plans when it comes to mental health and substance-use disorder treatments-and that leads to a greater reliance on out-of-network care…

..Some insurance companies have enacted policies of not paying for emergency care after it was determined that patients did not require it-even though the severity of their symptoms at the time made it prudent to go to the nearest emergency department.

..Insurance companies often change their drug formularies after patients are locked into their plan. This can lead to restricting access to treatment that has proven to work for them and has stabilized their condition. Patients may seek to pay out of pocket to continue their treatment rather than jump through their insurance company’s prior-authorization hoops.” (I)

“Surprise medical bills exist for a number of reasons, each of which are specifically rooted in problems inherent to a privatized, profit-driven health-care system. For one thing, there wouldn’t be out-of-network bills without networks themselves-a health insurance innovation put forward in the 1980s. Unlike more regulated health-care systems in peer nations, the American health-care system lacks a robust mechanism to control prices. This leaves each insurance plan to negotiate with providers on its own, and gives the latter more power to set prices.

Once health-care prices began to skyrocket in the 1970s, insurance companies began to try several cost-cutting measures that are now all too familiar to modern policyholders…The theory behind networks was simple enough: By contracting only with certain providers, insurers could deliver a higher volume of patients to each one and thereby gain more leverage over pricing negotiations. They could then translate the savings into lower premiums, attract more customers, and increase market share…

..and it’s the same problem underlying the proliferation of varied “insurance products” that cater to different types of patients. The degree of “choice” a given person has is overwhelmingly determined by their income and health status, which is a shamefully unjust way to allocate the costs of running a health-care system. The healthiest people are able to take their chances on a narrow network, while those with greater health-care needs are financially penalized for needing a wider breadth of providers. Meanwhile, the less money someone has available, the more they’re coerced into “choosing” a plan based on price rather than benefits…

Discussing and tackling the inequities-and potential for financial ruin-in our health-care financing system demands an acknowledgment that the sheer diversity of insurance plans in this country, each with their own pricing and benefit structures, is an inherently bad thing. When it comes to insurance policies, a multitude of consumer choices translates into genuine differences in the ability to access care. “Surprise out-of-network bills” are one highly visible example of how that hurts people. Others are never hard to find.” (J)

“While President Donald Trump prods Congress to limit surprise billing, at least three states are debating legislation to ban the practice…

Current state laws vary in scale and effectiveness. Federal legislation would be more effective, as it would protect the millions who receive self-funded coverage through their employer. But the political climate in Washington, where even historically bipartisan efforts move slowly at best, has left states to step in and do what they can…

The Colorado General Assembly passed a bill earlier this month that prohibits surprise billing and sets a reimbursement rate based on either commercial claims data or the insurers’ median in-network rate for the service. Gov. Jared Polis, a Democratic, is expected to sign the bill Tuesday, a spokesman told Healthcare Dive.

A surprise billing law is also on the governor’s desk In Washington. It calls for a “commercial reasonable amount” to be paid to out-of-network providers and establishes arbitration if the parties cannot agree on a rate through negotiation.

In Texas, a bill has passed the Senate and is currently making its way through the House. It requires an arbitration process for payments that do not include patient involvement. Previous legislation in the state required people receiving surprise bills to request remediation…

The Employee Retirement Income Security Act of 1974 limits the effectiveness of state surprise billing legislation because state laws can’t apply to employer self-funded plans, which cover the majority of Americans. Still, the laws can serve a few key purposes.

Several of the bills proposed in Congress defer to state laws on issues like rate setting or arbitration. So even if Washington passes a ban on surprise billing, states that want to set their own plans can count on using their own laws going forward…

“States have a lot of authority over providers … just making sure the providers have posted information and are being as informative as possible when consumers are coming into their facilities,” she said.” (K)

Arizona’s new law on surprise medical bills went into effect January 1. It sets up a procedure where patients can request dispute resolution through the state’s Department of Insurance. Unresolved disputes will enter arbitration. If an enrollee participates in an informal settlement teleconference (IST) beforehand, the law spells out what an enrollee’s liability: “By virtue of having participated in the IST, the enrollee can only be held responsible for paying the amount of the enrollee’s cost-sharing requirements (copay, coinsurance and deductible) plus any amount the health insurer paid the enrollee for the services provided by the out-of-network health care provider.” (L)

“Consumer complaints about surprise medical bills have fallen substantially in New York in the wake of a 2014 law that established a “baseball-style” arbitration protocol to address these situations, according to a new report.

Researchers at the Georgetown University Center on Health Insurance Reforms (CHIR) conducted a case study (PDF) on the state’s Emergency Services and Balance Billing Law and found that state officials report a “dramatic” decline in consumer reports about balance bills since the law took effect in 2015.

Based on an analysis of calls to the Consumer Service Society’s helpline for surprise billing, 57% of complaints were handled using the systems established under the law.

“It’s downgraded the issue from one of the biggest

[consumer complaints our call center receives]

to barely an issue,” a state regulator told the CHIR researchers.

In addition to surveying state officials, the Georgetown researchers also interviewed physicians, insurers and patients, and they found that overall the participants view the arbitration process as fair. However, providers were more enthusiastic than insurers, according to the study.

As of October, the number of resolutions in favor of insurers and in favor of physicians is about even, according to the study-618 were decided in favor of payers and 561 in favor of providers.

Insurers were more likely to win disputes over out-of-network emergency care billing, while providers were more likely to win in situations where a patient is treated by an out-of-network physician without his or her knowledge during an elective procedure.” (M)

“The American Hospital Association was among six national hospital groups that sent a letter to Congress on Wednesday to suggest parameters and ideas that legislators should keep in mind as they pursue a solution to surprise medical bills…

The letter to Congress, a copy of which was obtained by ROI-NJ, asks federal representatives to consider:

Defining what is considered a surprise bill;

Ensuring patients are protected and not balance billed;

Ensuring patients are not denied emergency coverage if a visit is considered non-emergent in retrospect;

Avoiding setting a fixed payment rate;

Ensuring patients are educated about their rights and coverage;

Supporting state laws (like those in New Jersey) that are protecting consumers.” (N)

“Assemblyman Nick Chiaravalloti is planning to introduce legislation in May that would plug a loophole in the (New Jersey) out-of-network law that has been affecting patients transferred out of state…

Health care professionals would be required to document in the patient records and notify patients of

The patient’s right to receive care at a facility of choice;

Clinical rationale for the out-of-state transfer;

Location of the out-of-state facility;

Availability of clinically appropriate services at nearby New Jersey facilities;

The nature of the relationship if the patient is being transferred or referred to an affiliated facility; and

In instances of trauma, stroke or cardiovascular diagnoses, an explanation as to why the patient is not being transferred to a facility in New Jersey.

The bill also requires patients be provided information from their insurance providers as to their potential out-of-pocket costs for an out-of-state facility, and requires health facilities to disclose to patients their relationships with out-of-state providers the patients are being referred to.

This is particularly important with the recent merger activity in South Jersey with some hospitals tied to health systems in Pennsylvania…

“To ensure that health care consumers are able to make well-informed health care decisions, patients should be informed of their right to select the facility in which they receive their care before being transferred to another state,” he said. “Patients should have all the information about why they are being transferred, and their financial responsibilities associated with the transfer – only then can a patient make an informed choice.” (O)

“One of the many wonderful advantages we have as residents of New Jersey is access to high quality, advanced health care. In fact, more than half of New Jersey’s 67 acute-care hospitals received an “A” rating in the Leapfrog Hospital Safety Report, the highest percentage of “A” ratings in any state across the nation. New Jersey is also home to tremendously skilled physicians and nurses, as well as 13 academic health systems training the next generation of health care professionals and researchers. Clearly, New Jersey residents have access to some of the nation’s greatest health care resources.

Despite these facts, a significant number of patients are referred or transferred to health care providers and hospitals located out of state. Some estimates indicate that New Jersey residents spend more than $2 billion annually on health care services out of state. Often these patients are paying considerably more for their out-of-state health care and receiving care that is equal to or less effective than they could have received at hospitals in New Jersey. With health care consumers paying a larger percentage of their health care costs through higher deductibles, copayments, and coinsurance, paying more for the same quality of care further from home makes little sense.

New Jersey residents should have the right to obtain health care wherever they believe it is best, but often patients do not have critical information necessary to make an informed decision. Moreover, many New Jersey residents do not understand the strong consumer protections they are forfeiting by seeking care outside of the state.” (P)

“Bob Ensor didn’t see the boom swinging violently toward him as he cleaned a sailboat in dry dock on a spring day two years ago. But he heard the crack as it hit him in the face.

He was transported by ambulance to an in-network hospital near his home in Middletown, N.J., where initial X-rays showed his nose was broken as were several bones of his left eye socket. The emergency physician summoned the on-call plastic surgeon, who admitted him to the hospital and scheduled him for surgery the next day.

Shortly before surgery, the doctor introduced Ensor to a second plastic surgeon who would assist in the 90-minute procedure. Entering through Ensor’s nose, the physicians realigned his facial bones, temporarily sewing Ensor’s left eye shut so that the lids would stay in place as the bones knitted back together.

Six weeks later, as Ensor, then 65, continued to make an uneventful recovery, a collection agency called to inquire how he and his wife planned to pay the $71,729 bill for the assistant surgeon. Ensor’s company health plan had denied payment because the surgeon wasn’t part of its contracted physician network.

There was more bad news. Ensor received notice that the health plan wouldn’t cover the $95,885 charged by the first plastic surgeon either because he also was out-of-network.

“The hospital knew these doctors were out-of-network and didn’t bother to tell us,” said his wife, Linda Ensor, noting they faced more than $167,000 in charges. “We were panicked.”

Riverview Medical Center in Red Bank, N.J., where Ensor was treated, said that it “empathizes with patients who are trying to navigate the complexity of the health care billing system” and that transparency in billing has not always been optimal for emergency department patients…

Many plastic surgeons don’t participate in health plans because they have flexibility other physicians may not have – their practices often focus on elective cosmetic procedures like nose reshaping and breast augmentation that patients pay for on their own…

Luckily for the Ensors, the sailing club stepped in to take up his case with the out-of-network plastic surgeons. Since sailing club members were required to volunteer on work projects to keep membership costs in check, the club’s insurer agreed to cover the accident as a workers’ compensation case. It paid 100% of the outstanding bill.” (Q)

“In an email to a complaining patient, the CEO of Spectrum Health acknowledged there needs to be more transparency regarding how patients are billed for doctor visits.

“We agree with you that a more transparent process is necessary,” Spectrum Health CEO Tina Freese Decker wrote (PDF) in response to a complaint. “I have shared your suggestion (for additional transparency) with our Spectrum Health Medical Group leadership so that we can apply this suggestion into our workflow.”..

The patient who sent the email to the CEO – and shared the response with Target 8 – had been charged $142 for a second appointment because she briefly discussed two minor issues with her doctor during her annual exam…

A month later, the patient received her bill. The annual wellness visit was covered by insurance, but there was a second charge for the same day that was not covered…

Additionally, a single mother from a small town in Kent County, who Target 8 is identifying only as Lindsey, previously reached out to Target 8 regarding a bill she got after a wellness visit with a physician at Spectrum medical building in Grand Rapids. While she waited for the appointment, Lindsey filled out the standard questionnaire, checking a box to indicate she had periodic leg cramps.

“(The doctor) looked at the form and she said, ‘Oh, I see you checked yes to leg cramps. Tell me more about it,'” Lindsey recalled.

Lindsey said the doctor showed her some stretches, told her to drink more water and checked her magnesium and iron levels in addition to the routine blood tests that were already scheduled for her annual physical.

“I get the bill… and I was charged for two office visits,” Lindsey said in an interview with Target 8 Thursday. “I called the doctor’s office right away and I said, ‘This can’t be right. Is this a mistake?'”

But it wasn’t a mistake…

If you’re going in for preventive services, know that there is a scope of services that’s considered preventive with zero cost, but if you go in and have a complaint or a scenario diagnosed, then it changes… to another category of care,” “.. (R)

“Yale researchers Zack Cooper and Fiona Scott Morton looked at emergency department visits that occurred at hospitals that were in insurers’ networks, in a paper for the New England Journal of Medicine. “On average,” they found, “in-network emergency-physician claims were paid at 297% of Medicare rates,” while “out-of-network emergency physicians [within in-network hospitals] charged an average of 798% of Medicare rates.”

A study from UnitedHealthGroup, looking at its own claims nationwide, recently estimated that out-of-network emergency physicians increased health care charges by $6 billion per year.” (S)

What’s behind this explosion of outrageous charges and surprise medical bills? Physicians’ groups, it turns out, can opt out of a contract with insurers even if the hospital has such a contract. The doctors are then free to charge patients, who desperately need care, however much they want.

This has made physicians’ practices in specialties such as emergency care, neonatal intensive care and anesthesiology attractive takeover targets for private equity firms…

A 2018 study by Yale health economists looked at what happened when the two largest emergency room outsourcing companies – EmCare and TeamHealth – took over hospital ERs. They found:

“…that after EmCare took over the management of emergency services at hospitals with previously low out-of-network rates, they raised out-of-network rates by over 81 percentage points. In addition, the firm raised its charges by 96 percent relative to the charges billed by the physician groups they succeeded.”

TeamHealth used the threat of sending high out-of-network bills to the insurance company’s covered patients to gain high fees as in-network doctors. The researchers found:

“…in most instances, several months after going out-of-network, TeamHealth physicians rejoined the network and received in-network payment rates that were 68 percent higher than previous in-network rates.”

What the Yale study failed to note, however, is that EmCare has been in and out of PE hands since 2005 and is currently owned by KKR. Blackstone is the once and current owner of TeamHealth, having held it from 2005 to 2009 before buying it again in 2016.

Private equity has shaped how these companies do business. In the health-care settings where they operate, market forces do not constrain the raw pursuit of profit. People desperate for care are in no position to reject over-priced medical services or shop for in-network doctors.

Private equity firms are attracted by this opportunity to reap above-market returns for themselves and their investors.

Patients hate surprise medical bills, but they are very profitable for the private equity owners of companies like EmCare (now called Envision) and TeamHealth. Fixing this problem may be more difficult than the White House imagines. (T)

  1. A.Surprise medical bills: The doctor is not in your insurance plan, by Liz Kowalczyk, https://www.bostonglobe.com/metro/2019/03/29/surprise-medical-bills-the-doctor-not-your-insurance-plan/pPjYw5ZzcnKljuzNdHiEJN/story.html
  2. B.Remarks by President Trump on Ending Surprise Medical Billing, https://www.whitehouse.gov/briefings-statements/remarks-president-trump-ending-surprise-medical-billing/
  3. C.Trump: Hospitals, payers must be held accountable for surprise medical bills, by Chris Mazzolini, https://www.medicaleconomics.com/news/trump-hospitals-payers-must-be-held-accountable-surprise-medical-bills
  4. D.Exclusive: the new bipartisan House bill to stop surprise medical bills, explained, by Dylan Scott, https://www.vox.com/policy-and-politics/2019/5/14/18622825/surprise-medical-bills-trump-house-health-care-legislation
  5. E.Analyzing The House E&C Committee’s Bipartisan Surprise Out-Of-Network Billing Proposal, byLoren Adler Paul B. Ginsburg Mark Hall Erin Trish, https://www.healthaffairs.org/do/10.1377/hblog20190514.695693/full/?utm_source=newsletter&utm_medium=email&utm_campaign=newsletter_axiosvitals&stream=top&
  6. F.Senate working group releases surprise medical bills legislation, by DAN DIAMOND, https://www.politico.com/newsletters/politico-pulse/2019/05/16/senate-working-group-releases-surprise-medical-bills-legislation-622157
  7. G.Dueling surprise bill measures were introduced on Capitol Hill. Here’s where they differ, by by Paige Minemyer, https://www.fiercehealthcare.com/regulatory/house-senate-surprise-billing-plans-divided-arbitration
  8. H.Health industry to clash over surprise medical bills, by NATHANIEL WEIXEL, https://thehill.com/policy/healthcare/443204-health-industry-to-clash-over-surprise-medical-bills
  9. I. 6 ways insurers drive the surprise-billing phenomenon, by Andis Robeznieks, https://www.ama-assn.org/delivering-care/patient-support-advocacy/6-ways-insurers-drive-surprise-billing-phenomenon
  10. J. OUT-OF-NETWORK MEDICAL BILLS ARE A PROBLEM. HEALTH-CARE NETWORKS ARE A BIGGER ONE, by NATALIE SHURE, https://psmag.com/ideas/out-of-network-medical-bills-are-a-problem-health-care-networks-are-a-bigger-one
  11. K.As Trump wades in, states move on surprise billing, by Shannon Muchmore, https://www.healthcaredive.com/news/as-trump-wades-in-states-move-on-surprise-billing/554647/
  12. L.MORE STATES CONSIDER REGULATION TO CURB SURPRISE MEDICAL BILLS, by AnneMarie Schieber, https://www.heartland.org/news-opinion/news/more-states-consider-regulation-to-curb-surprise-medical-bills
  13. M.New York’s arbitration program for surprise billing leads to decline in consumer complaints: study, by Paige Minemyer, https://www.fiercehealthcare.com/finance/new-york-s-arbitration-program-for-surprise-billing-leads-to-decline-consumer-complaints
  14. N.NJ. law on surprise medical bills could help shape similar federal legislation, by Anjalee Khemlani, http://www.roi-nj.com/2019/02/21/healthcare/n-j-law-on-surprise-medical-bills-could-help-shape-similar-federal-legislation/
  15. O.Out of state, not out of mind: Bill would close out-of-network loophole, by Anjalee Khemlani, https://www.roi-nj.com/2019/04/23/healthcare/out-of-state-not-out-of-mind-bill-would-close-out-of-network-loophole/
  16. P.3 hospital CEOs say patients should be told about their health care options before being transferred out of state, by Robert Garrett, Brian Gragnolati and Barry Ostrowsky, https://www.nj.com/opinion/2019/05/3-hospital-ceos-say-patients-should-be-told-about-their-health-care-options-before-being-transferred-out-of-state.html
  17. Q.Putting A Face To Surprise Bills: Among Specialists, Plastic Surgeons Most Often Out-Of-Network, https://khn.org/news/a-boat-crushed-his-face-then-plastic-surgeons-hit-him-with-167000-in-bills/
  18. R.Spectrum CEO: More transparency needed in billing, by Susan Samples, https://www.woodtv.com/news/target-8/spectrum-ceo-more-transparency-needed-in-billing/1974782962
  19. S.How To End The Scourge Of Surprise Medical Bills In The Emergency Room, by Avik Roy, https://www.forbes.com/sites/theapothecary/2019/03/12/how-to-end-the-scourge-of-surprise-medical-bills-in-the-emergency-room/#72bfbaf52a84
  20. T.Private Equity is a Driving Force Behind Devious Surprise Billings, by EILEEN APPELBAUM, https://www.counterpunch.org/2019/05/20/private-equity-is-a-driving-force-behind-devious-surprise-billings/

PART 3. SURPRISE MEDICAL BILLS. “I was never in a position to preselect who (would) perform my heart transplant,” (and if the physicians and surgeons were in network)….because she did not know when a new heart would become available.

“On March 8, 2011, Joclyn Krevat, an occupational therapist in New York, was sitting at her computer when she received a most unusual LinkedIn request. The wording was the familiar: “I’d like to add you to my professional network.” The sender was familiar, too, but not for the reason Krevat expected. It was from a debt collector.

Karen Pollack, the head of a debt-collections practice called KP Recovery Solutions, had been trying to collect on some medical bills Krevat had recently incurred for a heart transplant. Krevat’s debts, which were reviewed by The Atlantic, made up plot points in the worst kind of American health-care horror story. In December 2009, Krevat, who was 32 at the time, thought she was coming down with the flu. Instead, she was admitted to the hospital and diagnosed with giant cell myocarditis, a severe inflammatory heart disease that can lead to heart failure. After seven weeks on life support, a heart became available, and she had a transplant. For a year afterward, she wasn’t able to return to work.

Krevat’s husband was a teacher, and Krevat had good insurance through him. But some of the doctors who treated her turned out to be out-of-network-a situation she couldn’t control, because she did not know when a new heart would become available. She estimates that if she had paid every bill that was sent to her, the total would have been about $50,000…

Krevat’s bills began to arrive while she was still being treated at Columbia University Irving Medical Center. One came from one of the hospital’s doctors, Mathew R. Williams, for $9,000. Another came from a doctor named Aziz Ghaly for $17,418. A few months later, a separate invoice from Weill Cornell Physicians said she owed $22,464…

Krevat appealed to GHI, her insurer, saying the services should have been covered because she was unconscious when she received them. “I was never in a position to preselect who can perform my heart transplant,”… (A)

“From a planning perspective, Wolfgang Balzer is the perfect health care consumer.

Balzer, an engineer, knew for several years he had a hernia that would need to be repaired, but it wasn’t an emergency, so he waited until the time was right.

The opportunity came in 2018 after his wife, Farren, had given birth to their second child in February. The couple had met their deductible early in the year and figured that would minimize out-of-pocket payments for Wolfgang’s surgery.

Before scheduling it, he called the hospital, the surgeon and the anesthesiologist to get estimates for how much the procedure would cost.

“We tried our best to weigh out our plan and figure out what the numbers were,” Wolfgang said.

The hospital told him that the normal billed rate was $10,333.16 but that Cigna, his insurer, had negotiated a discount to $6,995.56, meaning his 20% patient share would be $1,399.11. The surgeon’s office quoted a normal rate of $1,675, but the Cigna discounted rate was just $469, meaning his copayment would be about $94. (Although the Balzers made four calls to the anesthesiologist’s office to get a quote, leaving voicemail, no one returned their calls.)

Estimates in hand, they budgeted for the money they would have to pay. Wolfgang proceeded with the surgery in November, and, medically, it went according to plan.

Then the bill came.

The bill for Wolfgang’s surgery turned out to be $2,304.51, $800 higher than he and his wife, Farren, had budgeted for, based on the estimates. “That’s a huge hit,” Farren says.

Total Bill: The estimates the Balzers had painstakingly obtained were wildly off. The hospital’s bill was $16,314. After the insurer’s contracted discount was applied, the bill fell to $10,552, still 51% over the initial estimate. The contracted rate for the surgeon’s fee was $968, more than double the estimate. After Cigna’s payments, the Balzers were billed $2,304.51, much more than they’d budgeted for…

When the bill came on Christmas Eve, the Balzers called around, trying to figure out what went wrong with the initial estimate, only to get bounced from the hospital’s billing office to patient accounts and finally ending up speaking with the hospital’s “Integrity Department.”

They were told “a quote is only a quote and doesn’t take into consideration complications.” The Balzers pointed out there had been no complications in the outpatient procedure; Wolfgang went home the same day, a few hours after he woke up.

The couple appealed the bill. They called their insurer. They waited for collection notices to roll in.

Hospital estimates are often inaccurate and there is no legal obligation that they be correct, or even be issued in good faith. It’s not so in other industries. When you take out a mortgage, for instance, the lender’s estimate of origination charges has to be accurate by law; even closing fees – incurred many months later – cannot exceed the initial estimate by more than 10%. In construction or home remodeling, while estimates are not legal contracts, failure to live up to them can be a basis for liability or “a claim for negligent misrepresentation.”..

Efforts to make health care prices more transparent have not managed to bring down bills because the different charges and prices given are so often inscrutable or unreliable, said Dr. Ateev Mehrotra, an associate professor of health care policy and medicine at Harvard Medical School…

The Takeaway: It is a good idea to get an estimate in advance for health care if your condition is not an emergency. But it is important to know that an estimate can be way off – and your provider probably is not legally required to honor it.

Try to request an estimate that is “all-in” – including the entire set of services associated with your procedure or admission. If it’s not all-inclusive, the hospital should make clear which services are not being counted.

Having an estimate means you can make an argument with your provider and insurer that you shouldn’t be charged more than you expected. It could work.

Laws requiring some degree of accuracy in medical estimates would help. In a number of other countries, patients are entitled to accurate estimates if they are paying out-of-pocket…(B)

“It appears that out-of-network billing for inpatient admissions and emergency department (ED) visits is becoming more common and expensive for patients.

Publishing in JAMA Network, study researchers examined 5.4 million inpatient admissions and 13.6 million ED visits between 2010 and 2016 and found that more than 39% of ED visits generated an out-of-network bill and 37% of all inpatient admissions resulted in an out-of-network bill.

The analysis of the claims data for privately insured patient showed an increase from 32.3% to 42.8% of ED out-of-network bills during the time period.

The study, led by Eric Sun, M.D., assistant professor in the Department of Anesthesiology, Pain and Perioperative Medicine at Stanford University, also found an increase from 26.3% to 42% of inpatient admissions with out-of-network bills.

Overall, the changes resulted in an increase from around $220 to $628 for an average ED patient visit for those with private insurance and an average increase from $804 to $2,040 for inpatient admissions costs.

Out-of-network billing for ED visits was particularly common for ambulance transport: 85.6% of encounters with ambulance services resulted in an out-of-network bill, with a mean potential financial responsibility of $244 to the patient.

Of patients receiving care from an emergency physician, 32.6% received an out-of-network bill while 23.8% of patients received an out-of-network bill from care from an internist and 22.8% received an out-of-network bill from care from an anesthesiologist.

When it comes to inpatient admissions, physician specialties with the most frequent out-of-network billing ranged from 0.8% for obstetrics and gynecology to 81.6% for ambulance services…

As of June, 25 states have enacted legislation offering some protection against out-of-network billing, ranging from dispute resolution processes to provisions holding the insurer responsible for the balance-billed amount.

In the U.S. Congress, pending legislation could help limit the scope and effects of out-of-network billing.

“Because out-of-network bills most commonly originated from clinical services (ie, medical transport, emergency medicine) about which patients have little choice, policy solutions centered on disclosure and consent at the point of care may not meaningfully address a large part of the problems patients face,” the authors said in the report. “Policies that limit the ability of physicians and medical transport services to balance bill patients-for example, by shifting some portion of the patient’s responsibility to insurers-offer stronger protection.” (C)

“Few defend the practice of surprise billing. Study authors note the ability to receive care from an out-of-network doctor could in theory provide flexibility for patients, but that doesn’t hold up when the patient isn’t aware a doctor treating them isn’t in network – providing the “surprise” aspect.

Out of network billing “appears to have become common,” according to the study author, noting the average amount of these bills is “sufficiently large that they may create financial strain for a substantial proportion of patients.”

The new research adds to the growing evidence surprise billing is becoming more prevalent. The Trump administration backs legislation to ban the practice, and several proposals are making their way through Congress, but there isn’t yet a concrete path. Lawmakers in Washington won’t pick up the issue again until after the summer recess at the earliest.

In an editorial accompanying the study, JAMA Internal Medicine Editor at Large Robert Steinbrook called on lawmakers to take action. “Congress and the Trump administration have the opportunity to solve the problem of surprise medical bills and move on to more far-reaching reforms to improve U.S. health care and decrease its costs,” he wrote.

Provider and payer lobbyists have been pushing back against the various efforts. Hospital and doctor organizations have railed against proposals, such as the main Senate HELP committee draft, which sets a payment standard for out-of-network services…

Other research has shown the pervasive effects of surprise billing. A Health Care Cost Institute report from March found that 15% of in-network hospital admissions had at least one out-of-network professional claim, with varying levels by specialty and location.

A USC-Brookings Schaeffer Initiative for Health Policy analysis showed about 20% of ER visits involved an out-of-network provider, and the Kaiser Family Foundation has found about 40% of Americans have reported receiving an unexpected medical bill.” (D)

“Surprise out-of-network bills arise when people turn to a hospital they know is part of their insurance plan’s network, but are treated by a doctor or provider in the hospital who does not have a contract with the insurer.

“In-network” providers agree to set rates with insurers and are not allowed to bill patients for more than their share of that contracted rate.

Providers who do not have contracts with insurers are considered out-of-network and can bill patients directly for the full cost of the service.

Medicare limits this practice, called balance billing. At least 25 states, including New Jersey, have established their own rules to protect privately insured patients. Other states and federal lawmakers are also considering legislation.” (E)

“Essentially no one in the United States likes surprise medical bills. That’s why Democratic and Republican leaders in both the House and the Senate pulled together common-sense bills earlier this year to curtail the practice.

So why isn’t such legislation a slam dunk? Because special interests – specifically hospitals and the private-equity-backed companies that have largely taken over their emergency rooms – are standing in the way. As lawmakers return to session next week, they should make it a priority to end this abusive tactic.

Studies suggest that surprise billing occurs in 20 percent of emergency-room visits – though the rate could be as high as 42 percent. The practice often happens when certain physicians at a hospital – for example, radiologists or anesthesiologists – issue a separate bill because they do not have a contract with the patients’ insurer regarding charges for specific services, even though the hospital is in network.

Imagine, as my colleague Benjamin Chartock puts it, going to a restaurant and getting a separate, unexpected bill for dessert because the pastry chef did not sign a contract with the owner. Such is the case when patients go to the hospital, where they are “captured” and don’t have the option to choose an in-network physician or to go without health care. This dramatically enhances the bargaining power of those physicians; without a contract, they can charge the infamous chargemaster prices that hospitals assure only foreign billionaires pay.

Frankly, however, doctors are not conniving enough to have figured out this scheme, nor are they responsible for putting it on an industrial scale. Surprise medical bills are the doing of the financial sorcerers at companies such as EmCare and TeamHealth, both owned by private equity firms, which are responsible for outsourced emergency rooms in hundreds of hospitals across the country.

Yale University researchers have found that when these companies take over an emergency room, the frequency of surprise billing skyrockets. For instance, EmCare takeovers of ERs caused a jump in surprise billing by almost 82 percentage points. And when TeamHealth employs the physicians, the frequency of surprise billing increased by 33 percentage points. (After the Yale study was published, EmCare negotiated with insurers to counter the torrent of negative press.)

The legislation making its way through Congress attempts to solve this by getting patients out of the middle, protecting them by charging them no more than typical in-network co-pays. The bills would also establish a fair price for the physicians who are out-of-network. The benchmark price, which would rise with inflation, would be the median in-network rate for the service in the local market where the patient was seen. That means physicians who do not sign contracts with insurers – in hopes of hitting the jackpot with out-of-network patients – would be paid the same as other similar physicians who were not so greedy.

The House – but so far not the Senate – has also proposed an appeals and independent arbitration process if physicians and hospitals are not happy with the benchmark payment. This is a sop to physicians, but it hasn’t kept special interests from spending millions of dollars on lobbying and political ads that target congressional members and portray physicians as poor victims of rapacious insurance companies.

Their complaints are hard to take seriously. Radiologists, anesthesiologists and emergency-room physicians are paid very well. Private insurers on average pay anesthesiologists about 3.5 times what Medicare pays, even while other physicians get on average only 1.3 times Medicare rates from private insurance. The average salary for radiologists is nearly $420,000 per year and for anesthesiologists is almost $390,000.

Hospitals fear, too, that they would be paid less under such legislation. They routinely warn that without the higher payments, they would have to reduce services or even close. But extorting patients with surprise bills hardly seems the way to shore up hospitals’ finances…

It appears that despite the overwhelming public interest, the usual will happen: Congress will waver and fail to pass a bill. Though Senate Majority Leader Mitch McConnell (R-Ky.) has expressed support for a bill in the past, there’s no guarantee he will allow the bill to come to the Senate floor.

If Congress fails to stand up to special interests here, what hope is there for legislation that addresses bigger health-care issues, such as exorbitant drug prices? It is enough to make believers in representative democracy scream in disgust.

No one likes surprise medical bills. So why does congressional action seem so unlikely?, (F)

“There is a broad consensus that consumers should be held harmless when they — through no fault of their own — receive bills from physicians that turn out to be out of network even though they work at in-network hospitals, she said. However, “the broad question is what the provider who’s provided those services will get reimbursed.” Two congressional committees — the Senate Health, Education, Labor, & Pensions (HELP) Committee and the House Energy & Commerce Committee — have already marked up their versions of surprise billing legislation, but two other House committees — Education & Labor and Ways & Means — have yet to produce bills; the issue will be how all those bills are reconciled with one another, Fontenot said.

“One thing that’s interesting to note is that the HELP Committee’s proposal did score a fairly significant level of savings, which they then used to reauthorize some of the public health programs in their jurisdiction,” she added. “As you change that proposal, as it goes through the process … those savings will dissipate depending on what they’re replaced with.” (G)

“Several states have created regulation that protects patients from the high medical care bills-but their authority only goes so far.

State bills cover the largest insured population-state employees-and commercially insured plans. But they do not regulate self-insured plans, often the plans used by large employers or companies who group purchase health care through a trade association. Those fall under federal law and make up more than 60 percent of health insurance plans in the country.

The regulations in each state typically differ in how they resolve the difference in what the provider claims and what they are reimbursed by the insurer.

In New York and Connecticut, for example, the states chose to pursue independent reviews, but are using cost information provided by a database, from FAIR Health, as the benchmark.

In New Jersey, meanwhile, the state chose to use baseball style arbitration-where both the health provider and the insurer provide their offer to a third-party arbitrator, and only one of the two final offers is chosen.

Despite the efforts at the state level, many patients still see high surprise bills because no federal regulations exist.

While regulating the industry is sought to be a political and policy win, both sides have their concerns.

The relationships between providers and insurers is already contentious-both are often on opposite sides of the table with insurers trying to negotiate down rates while providers are trying to negotiate increases in rates.

Both sides have said in state hearings around the country that the regulations will interfere in this delicate dance.

Neither disagree that there should be a provision stating that patients should be held harmless, but both want the government to stay away from the rest of the process.

The American Hospital Association voiced a similar concern Wednesday after the passing of the House committee bill.

“The AHA believes that once the patient is protected from surprise bills, providers and insurers then should be permitted to negotiate payment rates for services provided,” said executive Vice President Thomas Nickels in a statement.

“We strongly oppose approaches that would impose arbitrary rates on providers. It is the insurers’ responsibility to maintain comprehensive provider networks, and a default payment rate would remove incentives for plans to contract with providers or to offer fair terms.”

Similarly, the insurance lobbying group, America’s Health Insurance Plans, voiced concern.

“We strongly oppose the inclusion of arbitration because it does not solve the problem of surprise medical bills,” said AHIP president and CEO Matt Eyles.

“It increases the financial burden on everyone with coverage, increasing patient premiums and driving up the cost of health care. The arbitration proposal allows private-equity firms and certain providers to price gouge patients and then shifts the final decision to a ‘third party.’ This process introduces new bureaucracy and red tape into the system, with costs to hardworking taxpayers exceeding $1 billion.”

The Congressional Budget Office estimated that enacting the surprise medical billing law would reduce the deficit by almost $25 billion from 2019-2029.” (H)

“The Congressional Budget Office estimates a Senate package tackling surprise billing and drug prices will save the government $7 billion…

A majority of the increased federal revenue would come from the portion of the legislation that targets surprise medical bills. The legislation calls on insurers to pay a median in-network rate for out-of-network care for surprise bills. It would also ban balance billing, a practice where a provider bills the patient for any difference between the insurer payment and the provider’s charges.

CBO estimates that the surprise medical bill portion would increase revenue by $23.8 billion and reduce direct spending by $1.1 billion for total savings of $24.9 billion through 2029.

“That estimate accounts for effects on federal subsidies for insurance purchased through the marketplaces and for the effects that arise from lower premiums for employment-based insurance,” the CBO said.

The CBO says the strategy employed in the bill would carry some additional costs for insurers such as the cost of calculating the median in-network rates. Still, it says premiums would decline because the bill would require insurers to reimburse out-of-network providers through their own median rates for an in-network provider.” (I)

“The problem is, most of the solutions that are seriously being considered stand to hit providers and hospitals the hardest-particularly those that treat a high percentage of out-of-network patients, according to a new report from Moody’s Investors Service.

That includes hospitals, physician staffing companies and laboratories as well as radiology and other ancillary provider companies. Some of the proposals could also impact air ambulance providers.

For example, the bipartisan Lower Health Care Costs Act of 2019 from Senate Health Committee chairman Lamar Alexander and ranking Democrat Patty Murray would, among other things, require insurance companies to pay out-of-network doctors for care at a rate tied to the median in-network fee for treatments.

Likewise, providers would be barred from “balance billing,” or requiring patients to pay the difference between what their insurer is willing to pay and what the doctor says they’re owed. That legislation has been scheduled for markup next week.

“The solution that would have the least credit impact would be the arbitration avenue which is what certain states are already doing for state-regulated plans. It takes the patient out of the middle but preserves that kind of bargaining-negotiation between the provider and the insurer,” said Jessica Gladstone, an associate managing director at Moody’s and lead author on the report, told FierceHealthcare. (A Senate bill had been introduced last month proposing a “baseball-style” arbitration.)

According to the Moody’s, the proposals of capping out-of-network charges for emergency medical services at in-network levels, setting up an arbitration process to resolve out-of-network charges or requiring a single ‘bundled bill’ are all considered “credit negative.”

Of the potential options, bundled billing and in-network guarantees would be the most negative for hospitals and staffing companies. That is because many hospitals totally outsource the operations and billing of the emergency department to a staffing company.

“If you now require a bundled bill or an in-network guarantee, you’re now asking the hospital to control very large portions of the hospital operation that it had never had to control before. Most hospitals would outsource the emergency department precisely because they did not want to have to deal with the billing and the complexities that come with that,” Gladstone said. “That kind of proposal would fundamentally change the relationship between the hospital and the physician staffing companies.”

An in-network guarantee would add significant complexity, because many physicians and ancillary service providers are not employed or controlled by the hospital, she said.” (J)

“Two years, 16 hearings and one massive bipartisan package of legislation later, a key Senate committee says it is ready to start marking up a bill next week designed to contain health care costs. But it might not be easy since lawmakers and stakeholders at a final hearing Tuesday showed they are still far apart on one simple aspect of the proposal.

That sticking point: a formula for paying for surprise medical bills, those unexpected and often high charges patients face when they get care from a doctor or hospital that isn’t in their insurance network.

“People get health insurance precisely so they won’t be surprised by health care bills,” said Sen. Maggie Hassan (D-N.H.), the co-author of a separate proposal to tamp down surprise bills. “So it is completely unacceptable that people do everything that they’re supposed to do to ensure that their care is in their insurance network and then still end up with large, unexpected bills from an out-of-network provider.”

It’s a cause that has been taken up by President Donald Trump and various bipartisan groups of lawmakers on Capitol Hill.

The wide-ranging legislative package on curbing health care costs is sponsored by Sens. Lamar Alexander (R-Tenn.) and Patty Murray (D-Wash.), the chairman and ranking member of the Health, Education, Labor and Pensions (HELP) Committee. Given the committee’s influence, and because this legislation has bipartisan support in the Senate where not many bills are moving, industry observers are taking the HELP panel’s proposal very seriously.

Alexander and Murray’s bill lays out three options for paying surprise medical bills but does not specify which path the final legislation should take. Advocates for each of the choices were among the five witnesses Tuesday.

Their positions fell along familiar fault lines. Everyone acknowledged that patients who stumble into a surprise bill because their emergency care was handled at a facility not in their insurance network or because a doctor at their in-network hospital doesn’t take the patient’s plan should not have to pay more than they would for an in-patient service. But they differ on how much doctors, hospitals and other providers should be compensated and how the disputes should be resolved.

Tom Nickels, an executive vice president of the American Hospital Association, cautioned against using benchmarks to set pay levels, such as local customary averages or a price set in relation to Medicare. He said such a plan might underpay providers and hospitals could lose their leverage to negotiate with insurers.

Elizabeth Mitchell, president and CEO of the Pacific Business Group on Health – a group that represents employers, including some who are self-insured who pay their workers’ health costs- said doctors should be paid 125% of what Medicare pays. She told senators that an independent arbitration process like the one Nickels advocates would add unnecessary costs to the system.

Benedic Ippolito, a researcher with the American Enterprise Institute, said requiring all providers in a hospital to be in-network was the cleanest solution.

“On surprise billing, all three approaches are equal in that first and foremost they protect the consumer,” said Sean Cavanaugh, chief administrative officer for Aledade, a company that matches primary care physicians with accountable care organizations.

There was also broad support among the witnesses for some of the legislation’s transparency measures, especially the creation of a nongovernmental nonprofit organization to collect claims data from private health plans, Medicare and some states to create what’s called an all-payer claims database. That could help policymakers better understand the true cost of care, these experts told the committee.

Sen. Susan Collins (R-Maine) expressed trepidation about the all-payer claims database, noting that increased transparency could hurt rural hospitals, which typically charge higher prices than those in cities because their patient base is small and they need to bring in enough revenue to cover fixed costs.

The witnesses also offered support for eliminating “gag clauses” between doctors and health plans. These stipulations often prevent providers from telling patients the cost of a procedure or service.

“Patients and families absolutely have skin in the game … but they are in a completely untenable and unfair situation. They have no information,” said Mitchell, from the Pacific Business Group on Health. “We’re talking about providers not being allowed to share information. … Transparency is necessary so people can have active involvement.”

If one thing is clear, it’s that Alexander doesn’t want this summer to be a rehash of last year, when it appeared he had a bipartisan deal to address problems in the federal health law’s marketplaces before the effort fell apart.

“For the last decade, Congress had been locked in an argument about the individual health care market,” said Alexander at Tuesday’s hearing. “That is not this discussion. This is a different discussion. We’ll never lower the cost of health insurance until we lower the cost of health care.” (K)

“A shadowy group has spent more than $13 million since July advertising in states with vulnerable senators to oppose legislation that would rein in medical bills that take patients by surprise.

The campaign by a group calling itself Doctor Patient Unity, playing out on television, radio, and on social media in more than 20 states, is helping muddy the congressional debate over how to combat surprise medical bills and could make it harder to pass legislation this year, congressional aides familiar with the issue said in interviews, speaking on condition of anonymity.

The ad buys represent the most-expensive campaign on any health-related topic Congress has taken on this year, according to data from Advertising Analytics and Federal Communications Commission filings. That they’re targeting lawmakers up for re-election in 2020 sends the message that deep-pocketed interests are paying attention to how lawmakers vote on the issue.

“Ads like these with large budgets behind them effectively serve as a warning that even more money could be used to unseat the legislator if they vote the opposite way,” said Erika Franklin Fowler, who directs the Wesleyan Media Project, which tracks and analyzes political advertising in real time during elections.

The group has made seven-figure advertising purchases in seven states and six-figure buys in six more states. They all warn against “rate setting” and the group’s website urges listeners to contact lawmakers to oppose “stand up to the insurance industry and demand they pay for their fair share.”

Who is ultimately paying for these ads is shrouded in secrecy. The television ads are known as “issue ads” and therefore don’t require Federal Election Commission disclosure.

The ads are all being bought either by Del Cielo Media of Alexandria, Va., or its parent company, Smart Media Group, also of Alexandria, according to FCC filings. Both companies didn’t return repeated messages seeking comment.

Del Cielo has been linked to Republican campaigns. The group bought ads for political action committees opposing Democratic candidates such as Phil Bredesen, the former Tennessee governor who lost a Senate bid to Republican Marsha Blackburn in 2018, according to FCC filings. Del Cielo got more than $1.2 million from a political action committee favoring President Donald Trump, according to filings with the Federal Election Commission.

Doctor Patient Unity was formed as a corporation in Virginia by a limited liability company with the same address as the firm Holtzman Vogel Josefiak Torchinsky, according to state business filings. The law firm provides “strategic counsel and compliance advice” to entities involved in political and policy affairs, according to its website.

By using middlemen such as media buyers and corporation creators, the entities funding the ads can conceal their identities.

“One of the issues with the ‘dark money’ groups is that, by design, the identity of donors are intended to remain hidden,” said Anna Massoglia, a researcher at the Center for Responsive Politics.

The ads come amid a flurry of activity on surprise medical billing. House and Senate committees have approved legislation to ban what’s known as balance billing, where a provider seeks payments directly from patients for charges their insurers won’t cover.

Both the House and Senate bills, H.R. 3630 and S. 1895, would require health-care providers in certain emergency circumstances to accept a set rate, based on median rates for those services, when they treat patients as out-of-network providers.

Some senators, including some of those targeted by Doctor Patient Unity such as David Perdue (R-Ga.), have backed surprise medical billing legislation (S. 153) that takes a different approach, empowering a third-party arbitrator to settle billing disputes. While the group’s purpose in targeting a lawmaker who opposes rate-setting isn’t clear, it’s a matter subject to change in any compromise measure.

Sen. Thom Tillis (R-N.C.) in a statement said he’ll work to “improve and finalize” the Senate’s surprise medical billing legislation. His office didn’t respond to a request to clarify whether he supports the arbitration or rate-setting approach.

Doctor Patient Unity spent more than $300,000 Aug. 23 on ads that appear to target Sen. Jeanne Shaheen (D-N.H.), a potentially vulnerable Democrat, according to FCC filings. The two purchases of ad time are both in stations in Manchester, N.H.

Shaheen hasn’t been outspoken about surprise medical billings this year, but in 2018 introduced a bill (S. 3541) that would have tackled the same issue by capping the amount that hospitals and physicians could bill with out-of-network charges to people with individual market coverage.

According to FCC filings published Aug. 26, Doctor Patient Unity also bought nearly $5,000 in additional ads to air in the last weeks of August in nearby Maine, where Sen. Susan Collins (R-Maine) also faces a tough re-election bid.

Health-care provider and hospital groups have also pushed back on the rate-setting approach, claiming it unfairly favors insurers and warning it could discourage doctors from practicing in certain areas where the rates would be lowest. These groups have spent heavily to influence the bills this year.

The American Hospital Association has spent almost $10.2 million on lobbying in the first half of 2019, about $1 million more than at the same time in 2018, according to congressional filings. The American Medical Association likewise shelled out $11.5 million on lobbying in the first half of 2019, about a $1 million more than at the same point in 2018.

Health-care providers, particularly specialists, have a lot of money at stake. The Senate version would cut enough costs from the health-care industry to lower insurance premiums nationwide by about 1%, the Congressional Budget Office estimates.

Some lawmakers worry that private companies with lots of capital, such as private equity firms that own health-care provider staffing groups, could be putting their money into opposing the surprise billing legislation.

The private equity firm KKR bought Envision Healthcare, a hospital-based physician group, in 2018 for about $10 billion and Blackstone Group bought TeamHealth, another hospital-based physician group, for $6.1 billion in 2016.

Yale University health economists in 2018 looked at two emergency room outsourcing companies, EmCare and TeamHealth, and found they took advantage of an environment where they could either charge high out-of-network rates to patients or negotiate higher in-network rates with insurers.” (L)

“Lawmakers are returning to work Monday to a simmering fight over how to handle surprise medical bills, with the provider industry having spent the summer pushing hard for major changes.

Provider groups have spent the monthlong August congressional recess heavily lobbying lawmakers and their staff to use an arbitration model to resolve out-of-network payment disputes instead of a benchmark rate.

A legislative package passed by the House Energy and Commerce Committee has a benchmark rate for any out-of-network charges, but with a backstop that allows both providers and insurers to head to arbitration if negotiations break down. The Senate Health, Education, Labor and Pensions (HELP) Committee passed legislation in June that used a benchmark rate.

However, neither package has gotten a vote in the full House or Senate yet.

The Energy and Commerce legislation is right now in a “holding pattern” before reaching the House floor as both the House Education and Labor Committee and the Ways and Means Committee are considering their own surprise billing legislation, a House aide told FierceHealthcare. Meanwhile, in the Senate, Republican Sen. Bill Cassidy of Louisiana and Democrat Maggie Hassan of New Hampshire have their own legislation that includes an arbitration provision.

Some provider groups are aiming to influence whatever comes out of the two House committees.”..(M)

Thankfully, a few extra steps and simple strategies can be made to ensure you don’t get any more unexpected medical bills in the future. Here’s how you go about it:

Learning is half the battle –

Always stay in-network –

Keep asking – Always, always ask about coverage –

Get some preauthorization –

Always plan ahead –

Compare costs –

Document everything – (N)

N.Unexpected Health Bills: Tips To Avoid Them, by Jan Cortes, https://www.medicaldaily.com/unexpected-health-bills-tips-avoid-442055

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