No one ever wants to spend time in a hospital. It can be overwhelming, scary and difficult to navigate a complex system that includes doctors, nurses, technicians, laboratory testing and many other complexities. Once discharged and back home, it oftentimes only becomes more confusing once the hospitals and doctors bill for services. The reason for this is because although a patient may have all of their care performed at one hospital, every doctor seen may bill separately for the care provided. And while the hospital may take the patient’s insurance, there is no guarantee that each doctor covers the same plan. This post attempts to explain how to avoid being a victim of “surprise billing.”
A 2016 study by the New England Journal of Medicine examining information from one of the country’s largest health insurers found that 22 percent of the time patients went to a hospital covered by their insurance, the patient still received a bill from a doctor who was not in the insurance company’s network. On average, this out of network billing cost the patient $900 despite the hospital accepting the patient’s insurance. Determining whether each doctor the patient sees is also covered by the plan is often impossible. Zack Cooper, a researching at Yale University and an author of the study called this situation, “the health equivalent of a carjacking.”
Why does this situation occur? Simply put, it allows doctors to make more money. When hospitals and doctors agree to accept a patient’s insurance plan, they offer the insurance company paying the bill a substantial discount, also known as a negotiated rate, off the cost of care. These negotiated rates can be as high as a 67% discount. In return, the hospital can expect to receive the insurance companies’ numerous patients. It is a symbiotic relationship.
Many doctors in hospitals work for physician groups that bill independently from the hospital. Recently, these groups have begun to opt out of accepting insurance plans and instead prefer to bill the patient at the higher, unnegotiated rate. Chuck Bell, a director of Consumer’s Union notes that once patients ascertain that their hospital accepts their insurance, it is only fair to assume that the doctors at the hospital will accept the insurance as well. Instead, he analyzes that patients “follow the rules, and they go to the in-network hospital, and then it’s just like a bait-and-switch.”
This is even more complicated when a patient is rushed by ambulance to an emergency department with little regard or opportunity to determine whether the care is covered by insurance. Almost every insurance plan covers emergency hospital care for their insureds, regardless of whether the hospital is in network. But doctor’s groups? Not so much. In fact, a recent study highlighted in the New York Times this past September notes that two of the largest emergency department doctor’s groups, Envision and TeamHealth, “have routinely operated outside the insurance networks of hospitals where their doctors’ practice. This often leads to surprise bills for patients.”
Congress is attempting to remedy the situation. This past year, legislation passed out of both Senate and House Committees that would prevent doctors’ groups from sending bills to patients when they visit an in-network hospital. In situations where the doctors fail to negotiate a price with the patient’s insurer, the proposed legislation would dictate that doctors be paid the median price that other such doctors in the area receive.
The legislation seemed likely to pass the full body of the House and Senate and even President Trump voiced his support. However, this past summer a lobbying group calling itself Doctor Patient Unity began airing more than $28 million dollars in advertising aimed at blocking the legislation. After an investigation, the September New York Times article found that “the two largest financial backers of Doctor Patient Unity are TeamHealth and Envision Healthcare.” The legislation now faces an uncertain future.
In the interim, what can you do to avoid surprise billing? First, for any elective procedure or hospitalization that is not emergent, take your time to make an informed decision over who is providing your care. Ask the hospital whether their doctors are part of the hospital network and whether the individual doctors will be billing for their services at in-network rates. Carefully read the consents for care which often list the companies that the individual providers work for. If you are still unsure if the care is in-network, call your insurance company and get their response in writing. If the hospital is in-network, but some of the doctors are not, consider seeking care elsewhere and tell the hospital why you chose to bring your business to a different medical facility.
If you have health insurance through Medicaid, present your Medicaid card at registration and ask the hospital to accept it. Generally, under Illinois law, once the hospital accepts a Medicaid card and confirms that you are receiving your care through Medicaid, the providers are bound to charging the rates negotiated with Medicaid.
Finally, call your insurance company and ask them to negotiate rates with groups such as Envision and Team Health. Pressure from consumers can go along way towards remedying this practice. And do not stop there. Call your members of Congress and ask them to support legislation ending surprise medical billing. Remember, hospitals negotiate discounted rates with insurance companies because insurance companies provide the hospital more patients. If those same patients become vocal with doctor’s groups, perhaps a similar negotiation can occur.