MSSNY eNews: June 28, 2019 – Surprise Bills Go National

PRESIDENT’S MESSAGE Arthur Fougner, MD MSSNY President MSSNY eNews June 28, 2019 Vol. 22  Number 25

Colleagues:

We’ve all seen Geico’s humorous “Surprising” ad campaign. Unanticipated or “Surprise Bills” are not so funny. This situation most often occurs when a patient seeks services from a participating physician or hospital but then requires services not covered by the patient’s insurance plan. Consequently, the patient receives a surprise bill, often a significant amount. Everyone agrees this issue is problematic. The real issue becomes how to deal with it. Caution: this may get wonky.

New York State took the lead on this issue with the nation’s first surprise bill law, Article 6 of Financial Services Law: Emergency Medical Services and Surprise Bills. Most importantly, this law removed the patient from this troubling billing situation, leaving the dispute now between payer and provider. The out of network provider bills the plan for the services. If the claim cannot be resolved, the plan pays “an amount the health care plan determines is reasonable for the health care services rendered, except for the insured’s copayment, coinsurance or deductible” and the dispute may now go for independent resolution much like baseball arbitration – the arbitrator decides which number – the physician’s charge or the plan’s proposed payment is more appropriate.  One of the factors utilized by independent resolution is the usual and customary charge for that service.

History

Let’s back up for some history. In 2009, a settlement was reached between then NY State Attorney General Andrew Cuomo and UnitedHealth Group over using Ingenix, a wholly-owned subsidiary of United, as the resource for “usual, customary, and reasonable” pay rates. This settlement established FAIR Health. For NY, FAIR Health is now the resource for UCR.

NY’s law works. No, make that NY’s law works well. Arbitration decisions have gone 50 – 50. Surprise Bill complaints have dwindled down to a trickle. So NY’s law should be the model for the nation, right? Well … not so fast. Congress is now dealing with this issue as well other vexing pricing problems. Because of this, the insurers are now getting another bite at this apple. Proposed legislation would similarly remove the patient from any dispute but would establish the In Network payment as the standard. This is troubling for several reasons not the least of which is that that rate most commonly is felt to be a “low ball” payment. For this reason, many specialty care physicians had chosen not to participate with the plan in the first place.  Perhaps even more often, health insurers chose to not contract with these physicians because they were trying to limit their networks.  Heck, if this were going to be the case, why do the plans fight so bitterly against “any willing provider” clauses and insist on narrowing networks?

Why would Congress choose to reward the health insurance industry for this abusive behavior?

Proposed Solution

Another proposed solution is an All Payer Database. (I warned you this would get wonky.) Turns out the APD often excludes information about many employer-provided ERISA plans which tend to be the highest payers and are therefore more heavily weighted toward lower payers such as Medicaid. Perhaps we should call them Some Payer Databases. NY uses FAIR Health. The nation should do the same.

This issue is important because it involves all physicians – employed and independent, in-network and out-of-network. Employed physicians depend on the success of independent doctors the same as in network doctors depend on the success of their out of network colleagues.  What is being debated ultimately becomes a ceiling and the insurers know this. They are mobilizing all resources for this issue. We need to do the same. The wrong national law may undo much of what NY has successfully accomplished. You have received and will continue to receive MSSNY alerts on this issue. Please answer the call. We need all hands on deck. Please send a letter to your Representative, and Senators Schumer and Gillibrand here.

Arthur Fougner, MD
MSSNY President 

Comments? comments@mssny.org; @mssnytweet; @sonodoc99

Physicians Urged to Contact Schumer, Gillibrand and Members of Congress to Oppose Disastrous Surprise Medical Bill Legislation

All physicians are urged to contact Senators Schumer and Gillibrand, as well as their respective US Representative, to oppose disastrous legislation that would mandate out of network payment at insurer determined in-network levels, and in support of legislation to align with New York’s approach to surprise medical bills.  A letter can be sent from here.

This week the Senate Health, Education, Labor and Pensions (HELP) Committee advanced by a 20-3 vote S. 1895, the Lower Health Care Costs Act.  The surprise billing provisions of the bill are problematic because they would tie out-of-network payments to average in-network rates in situations where a patient did not have the opportunity to choose an in-network provision.  It also omits the independent payment arbitration process that has been supported by the AMA and state medical associations, and has been a successful model for New York.  Senator Dr. William Cassidy (R-LA) made strong comments against the surprise billing section in S.1895, noting that is it skewed heavily in favor of insurance companies.  He warned that letting insurance companies set rates will have dire consequence for rural and critical access hospitals that are already closing due to inadequate payments and it will exacerbate health care market consolidation problems.  Senators Hassan, Romney and Murkowski were also outspoken, expressing concerns with the contracted in-network rate benchmark and speaking in favor of including of an independent dispute resolution mechanism.

Separately, Congressman Ruiz, MD (D-CA) and a significant number of cosponsors from both sides of the aisle, including Representatives Morelle (D-Rochester), Stefanik (R-North Country) and Clarke (D-Brooklyn) from New York, introduced surprise billing legislation in the House that is based on New York model’s.

MSSNY has been working closely with other state medical associations, national specialty association, the Physicians Advocacy Institute and the AMA to oppose the health insurance industry gift that is S.1895, and to instead support legislation that aligns with New York’s approach.  MSSNY’s letter to Senators Alexander and Murray expressing strong concerns with S.1895 can be found here.

Physician Action Needed – Urge Governor Cuomo to Veto Liability Expansion Bills
Physicians are urged to contact the Governor to urge that he veto 2 bills passed at the end of the Legislative Session over the objections of many groups that could have the effect of driving up liability costs and creating an even more toxic malpractice adjudication system. Please take a minute to go to http://tiny.cc/VetoLiabilityBills and send a letter to Governor Cuomo urging him to veto these two bills and instead act to help bring down these costs through comprehensive reform.

S.6081/A.2372 will add costs to the system by requiring non-settling co-defendants in a tort action to choose whether to reduce their liability exposure by the stated settlement amount of a co-defendant or the settling co-defendant’s allocated percentage of fault prior to the first opening statement of the trial.  It would force these defendants into making a “blind gamble” and would enable in many cases the total payout to a plaintiff to actual exceed a jury’s award. There is little justification to this proposal other than increasing lawyer fees.

S.6552/A.2373 will also add new costs to the system, again with little justification. The bill would allow plaintiffs to collect a judgment from a third party that is not a direct party to the lawsuit in question. The bill would permit this to occur even though the plaintiff had not sued or perhaps could not have sued the third-party defendant in the first instance.

These bills have also been opposed by hospital associations and the insurance industry.

These bills would exacerbate an already onerous system. New York was recently granted the dubious distinction of having by far and away the highest cumulative medical liability payouts in the country. Of course, this is not the first time that our state has been “honored” with this distinction. In New York we pay out nearly two times as much as in the state with the next highest amount. We also pay out the highest amount per capita.

Yet instead of trying to address this problem, these two bills would make this problem even worse.

It is imperative that the Governor and legislators take action to ensure that physicians and hospitals remain available to deliver the quality and timely care our patients expect and deserve to receive. A critical element to this is acting to reduce the choking costs of medical liability insurance and stopping one-sided proposals that will undoubtedly raise these costs. We urge the Governor to work towards comprehensive reform to enable a comprehensive supply of physicians across New York, rather than enabling cynical attempts to increase lawyer fees at the expense of patient care.

URGE A VETO OF ONEROUS LIABILITY EXPANSION BILLS! CLICK HERE