Transcript Sha’Ron James Insurance Consumer Advocate Tasha Carter, Director Division of Consumer Services Department of Financial Services Balance Billing: The Impact on Consumers Tasha Carter, Director Division of.

Sha’Ron James
Insurance Consumer Advocate
Tasha Carter, Director
Division of Consumer Services
Department of Financial Services
Balance Billing: The Impact on Consumers
Tasha Carter, Director
Division of Consumer Services
Department of Financial Services
Division of Consumer Services
v
More than
1.2 million
consumer calls answered
since 2011
Advocated on behalf of
82,000 Floridians
since 2011
The Helpline has recovered
$123 million
to insurance consumers
since 2011
What is Balance Billing?
The practice of a healthcare provider billing a patient for the
difference between what the patient's health insurance chooses to
reimburse and what the provider chooses to charge.
Scenarios for Balance Billing
• Emergency Settings
• Surprise Billing Situations in a Network Hospital
• Unintentional Use of Non-Network Providers
The Impact on Consumers
• Financial Stability
• Forego Medical Treatment
• Stress
Current Consumer Protections
• Balance Billing Prohibition Applicable only to HMOs:
• Emergency Services
• Covered Services in In-Network Facilities
• Affordable Care Act
• All Emergency Services are Processed as In-Network
• Does not Prohibit Balance Billing
• DFS, Division of Consumer Services
Challenges to Assisting Consumers
• Administrative and Regulatory Limitations
• Lack of Administrative and Regulatory Authority
• Lack of Standardized Fees
Questions?
David Rogers, Ph.D.
Assistant Professor of Chemistry
Toma Wilkerson, Director
Division of Rehab and Liquidation
Department of Financial Services
Department of Financial Services
Balance Billing Issues In Receiverships
Presented by:
Toma L. Wilkerson, Division Director
Division of Rehabilitation and Liquidation
Mr. Smith’s Bill
Amount due from you is $43,193.73 as of 09/22/2013 for
Inpatient Services performed on March 31, 2013.
Total Charges
$119,982.57
Discounts/Adjustments Given
-$76,788.84
Insurance Payments Received
$0.00
Amount You Paid
$0.00
Receivership Overview
As Receiver we:
Are appointed by a court to oversee a troubled
insurance company
Receiver’s duties in liquidation generally include:
Take control of the insurer
Collect/control assets
Pay claims/bills based on priority scheme
Reasons for Receivership
Grounds for Receivership:
Impaired or Insolvent
Criminal activity- fraudulent transactions
Failed to comply with OIR order to make good on
impairment of capital or surplus
Continued operations hazardous to policyholders,
creditors, stockholders & public
Consent to receivership
Balance Billing In Receivership
Surprise balance billing (unexpected bill from
out of network provider)
Difference between the provider’s billed charges
and the amount the HMO paid for the services
Charges which should have been paid by the
insurance company in receivership but for which
the provider is holding the member responsible
Consumer Protection in Health Receivership
Florida Life & Health Insurance Guaranty
Association (FLAHIGA)
Pays health insurance claims up to limit of
$300,000 or replacement health coverage obtained
Florida Health Maintenance Organization
Consumer Assistance Plan (FHMOCAP)
Pays health insurance claims up to limit of
$300,000, six months or replacement health
coverage obtained
Health Company Liquidations
Balance billing claims of commercial members
may be covered by FLAHIGA & FHMOCAP
No similar protection for Medicare beneficiaries
No similar protection for Medicaid recipients
HMO Member Exposure to Balance Billing
HMO ENROLLMENT AS OF JUNE 30, 2015
Commercial
2,405,341
Medicaid
2,553,515
Medicare
1,120,204
HMO Liquidations
1997 – 2015: 14 HMO receiverships
All except one resulted in liquidation
Impacting over 270,000 HMO members
Majority HMO liquidations over the past 10
years involve Medicare/Medicaid
Problems Faced by HMO Members
Delay in payment on claim/no payment on claim
Problems when no guaranty association
coverage
Member/patient referred to credit agency
Credit ratings potentially impacted
Statutory prohibitions have little impact
Inability to enforce statutory prohibitions
Balance Billing
HMO Receivership Data – 1997 - 2015
PAID
PEND
TBD
• Over $313,600
• 442 Members
• 8 receiverships
• About $26,700
• 46 Members
• 2 receiverships
• Evaluate over
$330,000
claims filed by
members
• 3 receiverships
Balance Billing & Consumer Inquiries
- 2010 - 2015
In 5 year period, we have received 25,787
inquiries from consumers relating to health
care receiverships.
Of these, 7.5% - or 1,923 - calls and other
inquiries have related to balance billing
Specific Member Examples
Example
Law Offices, LLC
Attorneys at Law
05/26/15
1234 Olde Ninth Street, Dayton, OH 44067
Phone: 1-800--123-1234
… Please be advised that your account in the amount of $825.00 has been referred
to collections by the above named creditor(s). A check made payable in full to Pearl
Law Offices, LLC should be sent to this office in the enclosed envelope.
At this time, no attorney with this firm has personally reviewed the particular
circumstances of your account. Although this letter is from an attorney, the
attorney is acting solely as a debt collector and not in any legal capacity when
sending the letter. This letter should not be construed as a threat that any attorney
in this firm will file a lawsuit against you…
Receiver’s Handling of Balanced Billing
Analyze the facts regarding the bill
Inform consumer of prohibition against balance
billing
Send educational letter to provider informing
of statutory prohibitions
Encourage Provider to file a claim in the estate
in lieu of balance billing
Refer matter to Department of Health for
additional action, if necessary
Questions
Joy Ryan
America’s Health Insurance Plans
Charges Billed by Out-of-Network Providers:
Implications for Affordability
Florida Insurance Consumer Advocate’s Forum: Finding a Balanced Approach to Unexpected Medical
Expenses
October 15, 2015
Joy Ryan, AHIP Retained Counsel
Key Takeaways
Our study identified a pattern of average billed charges submitted by out-ofnetwork (OON) providers that far exceeded Medicare reimbursement for the same
service performed in the same geographic area. These findings reinforce
conclusions from our previous reports that used the three highest billed
commercial charges in a geographic region.
There was wide variation in out-of-network charges from different providers for the
same procedure. For example, billed charges for "muscle-skin graft trunk" differed
from $3,565 for the 25th percentile to $14,998 for the 75th percentile, and for "low
back disk surgery"—from $3,013 for the 25th percentile to $10,216 for the 75th
percentile.
Key Takeaways
Among the 97 procedures studied, average out-of-network billed charges, as a
percentage of corresponding Medicare fees, ranged from a low of 118% of
Medicare (“eye exam new patient") to a high of 1382% of Medicare
(“electrocardiogram (ECG)/monitoring and analysis”).
For many procedures, we found regional patterns in the ratio of out-of-network
charges to average Medicare fee at the state level. For example, states that had
high out-of-network charge-to-Medicare fee ratio for gall bladder surgery also had
high ratios for other gastrointestinal (GI) procedures.
AHIP’s new report, “Charges Billed by Out-of-Network
Providers: Implications for Affordability,” is available
online:
http://www.ahip.org/epub/OON-Report-2015/
Thank you!
Joy Ryan, AHIP Retained Counsel
Office: 850-425-4000
[email protected]
Jack Hoadley, Ph.D.
Health Policy Institute
Georgetown University
Balance Billing: How Are States
Protecting Consumers from
Unexpected Charges
Jack Hoadley, Ph.D.
Health Policy Institute, Georgetown University
Florida Insurance Consumer Advocate’s Forum:
Finding a Balanced Approach to Unexpected
Medical Expenses
October 15, 2015
Today’s Talk on Balance Billing
•
•
•
•
•
•
•
What it is and when can it happen
Elements of consumer protection
Seven state approaches
Cross-cutting issues
Snapshot of other states
State action in 2015
Questions & discussion
38
Covered Services
IN-NETWORK
OUT OF NETWORK
$
$ $ $
39
Balance Billing Scenario #1:
The Informed Consumer
40
Balance Billing Scenario #2:
Emergency Services in a Network Facility
41
Balance Billing Scenario #3:
Non-Network Providers in a Network
Facility (Non-Emergency)
42
Primary Elements
of Consumer Protection
•
•
•
•
Disclosure and transparency
Prohibition on providers’ balance billing
Hold harmless requirement for insurers
Ensuring fair payment
43
Elements of Consumer Protection:
Disclosure and Transparency
• Disclosure
– Insurer notices and plan summaries
– Provider notices at point of service
• Transparency
– Provider directories
– Hospital data with out-of-network providers
44
Elements of Consumer Protection:
Balance Billing vs Hold Harmless
• Prohibit balance billing by providers
– Assignment of benefits: transferring right of
reimbursement to out-of-network provider
– Limits providers from getting full payment
• Require insurers to hold members harmless
– Can result in higher premiums
45
Elements of Consumer Protection:
Ensuring Fair Payment
• Rate regulations using different
methodologies:
– Usual and customary
– Percentage of Medicare
– Prior out-of-network payments
• Independent dispute resolution (IDR)
46
State Approach: Florida
• Prohibits balance billing for emergencies
(Scenario #2) under HMO plans
– Insurers must pay lesser of provider charges,
usual and customary, or agreed upon amount
• For HMO plan, prohibits balance billing for
any covered services at in-network hospital
provided by out-of-network provider (#3)
(Dept. of Insurance interpretation)
• No provision for PPOs
47
State Approach: California
• Prohibits emergency room providers from
balance billing members (Scenario #2)
• Applies to health plans regulated by
Department of Managed Health Care
(HMOs and most PPOs)
• Established by California Supreme Court Prospect Medical Group case
• “Unfair billing practice” under Dept. of
Managed Health Care regulations
48
State approach: Maryland
• Requires insurers to hold harmless HMO
members (Scenarios #2 and #3)
– Also applies to PPO members with
assignment of benefits
• Prescribes payment methodology for outof-network physicians in certain situations
• Requires disclosure at point of service for
certain physicians who want to balance bill
49
State Approach: Colorado
• Hold harmless when consumer is unaware
of out-of-network provider: emergency
(Scenario #2) and surprise billing scenarios
(Scenario #3)
• Also applies to referrals with inadequate
networks
• Issue with high deductible health plans
50
State Approach: Texas
• Prohibits balance billing
– Emergency scenario (#2) for HMO members
– Surprise billing scenario (#3) and inadequate
network situations for EPO members
• Disclosure requirements for PPO plans
• Reporting requirements for in and out-ofnetwork claims
• Mediation process with $500 threshold
51
State Approach: New York
• Implemented in 2015
• Prohibition on balance billing in both
emergencies (Scenario #2) and surprise billing
(Scenario #3) with assignment of benefits
• Has guidelines on reasonable payment
amounts
• Establishes IDR using “baseball” approach
• Requires disclosure by health plans, and
hospitals and providers at point of service
52
State Approach: New Mexico
• No laws on balance billing
• Insurers address on case by case basis
• One insurer generally holds consumers
harmless
53
Summary of State Approaches
CA*
CO
FL*
MD*
NM
NY
TX*
Hold harmless or
prohibition, Scenario 2
(emergency)
Yes
Yes
Yes
Yes
No
Yes
Yes
Hold harmless or
prohibition, Scenario 3
(surprise bills)
No
Yes
Yes
Yes
No
Yes
Yes
Hold harmless or
prohibition in other
situations
No
Yes
No
Yes
No
Yes
Yes
Mediation or dispute
resolution process
Yes
No
Yes
No
No
Yes
Yes
Disclosure beyond
standard notice
No
No
No
Yes
No
Yes
Yes
*Application of hold harmless/prohibition provisions vary by type of plan; see full report for details
54
Degree of Consumer Protection
• Some approaches more effective at keeping
consumer out of dispute between plan and
provider
• Some gaps in protection are based on
segments of market not covered
55
Health Care Setting
• Emergency vs. surprise billing situations
(Scenario 2 vs. Scenario 3)
• Greater support for emergency situations
but growing attention to surprise billing
• Narrowing networks could increase
likelihood, drive interest in addressing
surprise billing
56
Rate Setting
• Maryland sets specific requirements for
payment levels to be paid by insurers
• New York sets guidelines for reasonable
payment
– Fair Health
• Role of assignment of benefits
57
Dispute Resolution
• New York uses independent dispute
resolution: provider or insurer can initiate
• Texas requires consumers to initiate
• Other state processes (CA, FL, TX) rarely used
58
Disclosure and Transparency
• Texas: in lieu of more direct protections
• New York: complement to other measures
• Value
– To consumers
– To media and policy community
59
Impact on Providers and Insurers
• Balancing provider and insurer interests
• Impact on market
– Health plans & ability to negotiate with
providers
– Adequate networks
– Increase in premiums
60
Snapshot of State Laws Addressing
Out-of-Network Providers
Blue: Study states with balance billing laws
Green: Other states with balance billing laws
Source: Kaiser Family Foundation, State Health Facts, State Restriction Against Providers Balance Billing Managed Care Enrollees
61
State Action in 2015
• Passed (as of October 2015)
– CT: address ER scenarios and rate setting, surprise billing
scenarios, disclosure requirements
– TX: lower threshold to $500 for mediation
• Failed or Pending (as of October 2015)
– CA: extension of prohibiting balance billing to surprise
billing scenarios
– FL: extension of prohibiting balance billing for emergency
scenarios to PPOs
– NJ: establishing dispute resolution process for surprise
billing scenarios
– CO: prohibit out-of-network providers from balance billing
at in-network facilities
62
NAIC Model Law
• Initiative to create a new network adequacy
model law
• Intent to address balance billing for out-ofnetwork services
• Negotiations still in progress
63
Georgetown report available at:
http://www.rwjf.org/en/library/research/2015/06/balancebilling--how-are-states-protecting-consumers-fromunexpe.html
Questions?
Forum will resume at 1:00
Kyle Simon, Director of External
Affairs & Communications
Florida CHAIN
Insurance Consumer Advocate’s
Forum:
Finding a Balanced Approach to
Unexpected Medical Expenses
October 15, 2015
Community Health Action Information Network
Kyle Simon,
External Affairs and Communications Director
Florida CHAIN
Protecting consumers from unfair
surprise bills
• Consumers with protection
– Medicaid enrollees
– Medicare beneficiaries
– Worker’s compensation
– HMO members in an ER
• No protections for PPO
subscribers
Community Health Action Information Network
Consumer uses in-network facility &
surgeon
• In-network surgeon
• Completes preauthorization
• Confirms in-network
hospital
• Out of network
anesthesiologist
• Out of network pathologist
=
Large out of network
“balance bill”
CHOICE
When consumers have no choice insurers and
providers must hold consumers harmless
Community Health Action Information Network
Consumers cannot protect themselves
Community Health Action Information Network
Out-of-network ER docs at
in-network Hospitals
Texas 2013 Data from Pogue S, Randall M. Surprise medical bills take
advantage of Texans: Little known practice creates a "second emergency" for
ER patients. Center for Public Policy Priorities; 2014.
Community Health Action Information Network
Prevalence of OON providers at
in-network facilities
Percentage of in-network
hospitals with no
in-network provider type,
by physician specialty
Community Health Action Information Network
Average percentage of
dollars billed OON at
in-network hospitals,
by physician specialty
•
•
•
•
•
Charles Baker had chest pain
The hospital is in network
The ER docs are out of network
Balance billed $1,235
The ER physician group practices at
hospitals throughout the area
• ER physicians are OON for major insurers
Community Health Action Information Network
Deciphering the balance bill
Billed from the ER doctor
Insurer’s in-network contracted amount agreed in
advance
Insurer’s “allowed amount” paid out-of-network
In-network
Out-of-network
$1,550
$1,550
$670
n/a
n/a
$450
What your insurer pays
80% coinsurance 70% coinsurance
$550 x .8 = $536 $450 x .7 = $315
Your coinsurance/cost-sharing
20% coinsurance 30% coinsurance
$550 x .2 = $134 $450 x .3 = $135
Balance bill –difference between billed charge and
allowed amount out-of-network
n/a
$1550 - $450 =
$1100
$134
$135 + $1100
=
$1,235
Total amount consumer owes
co-insurance plus and balance bill
Example assumes annual deductible has been satisfied. Adapted
from Pogue S, Randall M. Surprise medical bills take advantage of
Texans: Little known practice creates a "second emergency" for
Community Health Action Information Network ER patients. Center for Public Policy Priorities; 2014.
One third of consumers had surprise bills
USA
Had surprise bills after hospital/ER visit
Was surprised to learn a doctor, lab, or facility
believed to be
in-network was actually out-of-network
FL
37% 35%
14% 18%
Total
220
628
2
Of those that had surprise billing issues
Charged out-of-network when thought the
provider was in-network
Total
14% 12%
657 216
Source: Consumer Reports® National Research Center.
Surprise medical bills survey: 2015 nationally-representative
online survey. 2015.
Community Health Action Information Network
Consumers are unaware of remedies for problems
USA
FL
Know what state agency handle health insurance complaints
11%
13%
Understand the right to external appeal if health plan denies coverage
21%
22%
Total
2202
628
Why consumers didn’t take any action I didn't think it would make a difference
I didn't have time/it wasn't worth my time
I was confused about what to do or found it too complicated
I didn't know how to take action/where to complain
I was afraid of creating trouble with the plan or physician
Total
42%
18%
14%
12%
4%
229
48%
13%
8%
10%
2%
72
Source: Consumer Reports® National Research Center. Surprise medical
bills survey: 2015 nationally-representative online survey. 2015.
Community Health Action Information Network
Solutions to the surprise balance bill
• Insurers and providers must hold patient harmless from out-of-network
charges in any case where the consumer has no choice –
– Patients should be responsible for their in-network share of costs only
– Resolution of out-of-network charges should exclude consumer
participation
– Surprise out of network providers cost-sharing apply to in-network
deductible
• Provider directories must identify in-network facilities without in-network
contracted hospital-based providers
• At point of purchase insurers should disclose
– Percent of out-of-network ER physicians at in-network ERs
– Percent of all out-of-network hospital-based providers at
in-network hospitals
Community Health Action Information Network
Solutions to health insurance literacy gaps
• Every EOB should
contain process for
internal and external
appeal for benefits and
payment
determination
Community Health Action Information Network
Jeff Scott, General Counsel
Florida Medical Association
Audrey Brown
Florida Association of Health Plans, Inc.
Ashley Norse, MD, FACEP
Florida College of Emergency Physicians
Balance Billing
Ashley Norse MD
Immediate Past President
Florida College of Emergency Physicians
October 15, 2015
Daniel F. Brennan MD
Chair, Medical Economics Committee
Florida College of Emergency Physicians
Patients Caught in the Middle
Extreme Variability in How Insurers Pay
Out of Network
How Often Insurers Pay Charges OON
100%
80%
88%
Payments all over the board:
0, 125, 150, 170, 200, 250, 325% Of Medicare allowables
Patient liable for balance bill
60%
36%
40%
16%
20%
0%
0%
Insurer A
2%
B
7%
9%
C
D
Martin Gottlieb and Assoc., All FL OON payor data 4/2014 – 12/2014
E
F
G
Emergency Physician Billing
$679
Average Physician Out Of Network Charge
$307
Average Insurance Payment
$372
Average Patient Responsibility
$49
Average Patient Payment
Insurance
Payment
Patient
Payment
MGA data
850,000 ED visits
July 2013-June2014
Copay Co-insurance
Deductible
Balance Bill
Average Patient
Responsibility
$686.07 = UCR
CPT 99283
80th%ile 336xx
$180
Balance Billing
A burden for patients
–“Surprise” bill – expect ED coverage
–Out Of Network + low payor payment =
balance billing
–A symptom of the inability of providers
to contract for an adequate payment
from insurers
Balance Billing
Even without balance
billing, patients (both in
and out of network) often
face large bills by
insurance plan design
– High copays designed
to deter ED use
– High deductible
plans
Florida Emergency Medicine Volume Mix1
FL has 3rd largest uninsured population
3,600,000 – Henry J Kaiser Family Foundation, CDC
MEDICARE
23%
MEDICAID
30%
OON
12%
This 26% subsidizes
COMMERCIAL/ the other 74%
MANAGED CARE
26%
UNINSURED
20%
1
Out Of Network =
Less than 4% of all
FL ED visits
MGA data, 850,000 FL ED visits, July2013 - June2014
MCR/MKD/UNINS
Reimburse < cost of care
CONTRACTED
IN NETWORK
88%
OON 12% AHIP Feb2013
HB 221 (Trujillo) 2016
Similar to SB 516 Bean/Garcia / HB 681 Trujillo 2015
Balance Billing Ban
Also modifies existing HMO law
Compounds problems of last session’s proposals
Proposed OON Payment
1. Negotiated amount
2. Insurer’s UCR
3. Medicare
History of Insurers Manipulating “UCR” Payment
Database
Ingenix Database
• UHC
• Aetna
• Cigna
• WellPoint
Underpaid providers
Patients left with balance bill
Medicare is Not a Reasonable Basis for Physician
Reimbursement
Health Insurance CEO’s 2013
11 largest for-profit companies
Compensation packages $125 million plus
250
$20,000
$18,000
200
$16,000
$14,000
150
$12,000
$10,000
100
$8,000
$6,000
50
$4,000
$2,000
0
CPI – US All Item, US Dept of Labor Bureau of Labor Statistics http://data.bls.gov/ (+45% / 17 years)
Medicare Allowable, 99284, FL Loc 1 / 2, https://www.cms.gov and MGA data (+23% / 15 years)
Average Annual Family Health Insurance premiums http://www.ahrq.gov (+66% / 10 years)
Health Insurance CEO’s 2013 compensation – Center for Public Integrity http://www.publicintegrity.org
$-
10/8/15
EPs seek FAIR Payment
Critical care 99291 1st hour $229.93
Tow + inpound fee: $300 + mileage
Medicare 2015 Allowable FL Loc 1 /2
Miami Dade
Unintended Consequences HB 221
• Insurers fully control payment
Typical ED Payor Mix
– No incentive to contract above Medicare
– Even narrower networks
• Providers and Access at risk
– Medicare/Medicaid/Uninsured reimburse < cost
of care
• Gross revenue decreases 30-35% at Medicare rates1
• Net physician compensation drops by 50%
• Community safety net placed at risk
1. MGA
/ EPCF data, Managed care at Medicare rates vs. current contracts
Problem #1 = HB 221 Payment Provisions
• Solution – Define UCR required OON payment
– Mimic HMO Law – “usual and customary charges”
Problem #2
Emergency Medicine CoPay /Co-Insurance
& Deductibles
• Unique to Emergency Medicine - EMTALA / patient
advocacy
– Emergency Physicians see all patients irrespective of
ability to pay
– Emergency Physicians are unable to collect copays /
co-insurance or deductibles at point of service
• Solution
– Insurers “front the money”
– Insurers directly reimburse ED providers
– Insurers collect co-pays, co-insurance and deductibles
from subscribers according to their plan design
Problem #3 – Dispute Resolution
• MAXIMUS
– Rarely used (9 claims accepted for review in 2014)
– Viewed by providers as unreliable, arbitrary
• Solution:
– Standard dispute resolution procedures
• Arbitration – ie AAA
• Legal recourse
• Prevailing insured or beneficiary costs recoverable
(e.g., F.S 627.428)
EPs are Patient Advocates 24/7/365
Seek FAIR Payment to Maintain Access to Care
With FAIR Payment No Balance Billing Occurs
Bill Bell, General Counsel
Florida Hospital Association
Forum will resume at 2:45
Public Comments
Closing Remarks