NY Times - Out-of-Network Costs - AMA (Doctors) and AHIP (Insurers) Point Fingers - We All Lose

[TomCADem]

It is funny how the "are you happy with your insurance" surveys manage to miss people who often receive emergency or urgent medical care out-of-network, their insurers only pays a fraction of the bill, then they are left with the exorbinant balance, which the hospital bills directly to the patient, rather than negotiating with the insurer. Thus, the individual is left holding the bag.

A few states prohibit such direct billing of consumers, and require hospitals to deal with the patients insured, rather than simply sending the bill to a collection agency, then telling the patient to deal with their insurer.

http://www.nytimes.com/2009/08/12/health/policy/12insure.html?hpw

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A patient in Illinois was charged $12,712 for cataract surgery. Medicare pays $675 for the same procedure. In California, a patient was charged $20,120 for a knee operation that Medicare pays $584 for. And a New Jersey patient was charged $72,000 for a spinal fusion procedure that Medicare covers for $1,629.

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State laws protecting patients from getting stuck with medical bills in excess of their normal deductibles or co-payments vary widely, said Betsy M. Pelovitz, the group’s vice president for state policy. And, she said, the laws often offer little or no protection to patients who seek care outside their insurance networks.

In New York, patients with managed-care insurers cannot be asked to pay more than the applicable co-payment, deductible or co-insurance for an ambulance regardless of whether the provider is in or out of their network. In New Jersey, hospital emergency rooms treating Medicaid managed-care patients must accept Medicaid payments as payment in full and cannot bill patients extra. In Connecticut, a state law says it is “unfair trade practice” for medical providers to ask patients to pay more than a deductible or co-payment for services covered by their insurance.

But in general, patients hit with high bills from out-of-network doctors and hospitals may have little recourse, said Leslie Moran, senior vice president of the New York Health Plan Association. “When patients dig in their heels and say, ‘No, I’m not going to pay it,’ it sometimes goes to collection,” she said

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[TomCADem]

1. Follow-Up - NY Attorney General Reached Settlements With Insurers

AHIP is publishing the survey referenced in the NY Times to support an argument that insurers are not responsible for problems relating to the reimbursement of out of network costs. However, the NY AG conducted an investigation that showed that insurers were setting reimbursement at an artificially low amount, which resulted in patients being left to fund the difference.

http://www.oag.state.ny.us/media_center/2009/june/june18a_09.html