Life is Full of Surprises

“Surprise!” Everybody likes a surprise, right? A birthday surprise, a holiday surprise, a surprise promotion….they’re all good.

However, there is a surprise that no one wants and it’s becoming all too common in health and health care – surprise medical bills.

First, let’s be clear about what we mean. Surprise or unexpected billing is when you get charged for something that you never saw coming. According to a report in the Wall Street Journal (WSJ), it often includes out-of-network specialists or lab work that the patient doesn’t choose and often doesn’t even know about. Below is a list of examples, from the WSJ article, of the people and procedures most likely to not accept your health plan coverage:

  • Anesthesiologists,
  • Radiologists,
  • Pathologists,
  • Specialists (such as cardiologists) who are brought in for consultation,
  • In-network surgeon but out-of-network hospital, or
  • In-network hospital but out-of-network surgeon.

From MarketWatch.com:

“Experts say patients usually encounter an out-of-network provider unwittingly: an anesthesiologist who sees a patient only briefly before surgery, for example, or a radiologist who never meets a patient but reads her scan. Out-of-network doctors often frequently work in the emergency rooms of in-network hospitals, so patients might not even know they’re being served by one — or feel, in the moment, that they don’t have other options.”

We received an email from an Arizona husband and wife who received a surprise billing. The wife had a kidney biopsy at an “in-network” facility by an “in-network” physician. However, the husband told us he didn’t know the doctor in the recovery area only contracted with the hospital (even though the husband says he wore a hospital badge) but was not “in-network.” The couple received a bill for almost $700.

An article in the The Journal of American Medical Association (JAMA) said of unexpected billing, “Patients also have no way of anticipating that even when they choose an in-network hospital, some of the clinicians treating them may be out-of-network. Patients in these situations believe they are playing by the rules but nevertheless get hit with big bills after the fact.”

ConsumersUnion.org has a website that encourages people to send in their unexpected billing stories and even has a map to show which states are passing consumer protections against unexpected billing. Arizona is listed as “working toward protections.”

surprise

The Arizona Hospital and Healthcare Association (AzHHA) has identified unexpected billing as a key priority for 2016. AzHHA supports a policy in which insurance companies hold their members harmless for unexpected bills…that is bills they receive for out-of-network physician services at in-network facilities.  Debbie Johnston, AzHHA senior vice president for policy development,  said “A hold harmless provision would incentivize health plans to negotiate adequate reimbursement with physicians, and mitigate the need for out-of-network physicians to balance bill.”

 Now it’s your turn. Let us know whether you too support a “hold harmless” provision in Arizona, or if you think the current system should remain intact or be tweaked in another way.  These are the types of topics we have to be willing to talk about if we truly want to reach our goal of one day making Arizona the Healthiest State in the Nation!

2 thoughts on “Life is Full of Surprises

  1. An acknowledgment and a short summary of my background is in order prior to commenting on the issue of “surprise billing”. First, my daughter is an employee of the Arizona Hospital and Healthcare Association. Second, with over three decades of experience as a senior executive in government, investor owned and not for profit healthcare organizations, the issue of out-of-network charges is not new. In fact, the problem has existed for approximately 45 years beginning with the introduction of HMOs and PPOs. It is now exacerbated by the ever narrowing provider networks in an attempt to control the increase in costs.

    The proposal to have payers provide their insureds with a hold harmless provision for non-contracted providers is puzzling. Since the insured would bear no responsibility for using out-of-network services, networks become irrelevant and the economic formula of trading volume for discounts is dismantled. For those that would argue that the “free market” would moderate pricing, it should be remembered that the Laws of Supply and Demand are only tangentially related to the healthcare industry. An insured population takes the natural tension between buyer and seller out of the equation.

    Not too long ago the healthcare industry in general and the hospital sector in particular, promoted the hospitality portion of the patient experience. By definition that would mean the patient is the customer. It seems unreasonable to expect your customer to know more about the arcane workings of the healthcare and insurance industries than the very people who are themselves part of those industries.

    The insurance industry is also at issue here. Most still reimburse the provider community as if they were piecework garment workers and have provider directories that are either incomplete, incorrect or out of date. Some insurers do pay their insureds an amount equal to what they would have paid an in-network provider. When the insured forwards the payment to the provider, a balance bill is sure to follow. There are more than a few providers that do not accept any commercial/self-funded insurance and generate a significant portion of their income from balance billing.

    The issue is solvable and the AZHHA has a unique opportunity to take the lead. Why not bring together all the stakeholders (hospitals, physicians, insurers, ancillary providers, patients, etc.) and facilitate the discussion for the benefit of all?

    Ken Diamond, Ph.D.

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    1. Thank you for your comment, Dr. Diamond. You rightly point out that there are a number of factors that make this a complicated issue. We agree that bringing stakeholders together to discuss the best next steps is a task that we are well paced to initiate, and we plan to do so.

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