ER Doctors Say that “Affordable” Premium Policies Mislead Patients

Ninety percent of emergency physicians say that health insurance companies mislead patients by offering affordable premiums for policies that actually cover very little, according to a survey by the American College of Emergency Physicians (ACEP). Ninety-six percent say that emergency patients don’t understand what their policies cover for emergency care. Eighty percent of ER doctors say they are seeing patients with health insurance who have missed or delayed medical care because of high insurance costs – a more than a 10% increase over six months ago.

Jay Kaplan, MD, FACEP, president of the American College of Emergency Physicians (ACEP) says, “Each day, emergency physicians are seeing patients who have significant co-pays for emergency care of up to $400 or more. It might as well be $4,000 for some people…Insurance companies must provide fair coverage…and be transparent about how they calculate payments. They need to pay reasonable charges, rather than setting arbitrary rates that don’t even cover the costs of care. Insurance companies are exploiting federal law to reduce coverage for emergency care knowing emergency departments have a federal mandate to care for all patients, regardless of their ability to pay. When plan reimbursements don’t cover the cost of providing services, physicians must choose between billing patients for the difference or going unpaid for their services. The vast majority of emergency physicians and their groups prefer to be in network.”

Dr. Kaplan says that health insurance companies are creating narrow networks of medical providers to increase profits, making it more likely for patients to go out-of-network. The survey of ER doctors also reveals the following:

  • 62% of ER doctors say that most health insurance companies provide inadequate coverage for emergency care visits.
    More than 80% of ER doctors who are aware of reimbursement issues agree that insurance companies have reduced emergency care reimbursements.
  • 60% of ER doctors say that, in the past year, they have had difficulty finding in-network specialists to care for patients with a quarter of them saying it happens daily.
  • 91% of ER doctors say that a new rule by the Centers for Medicare and Medicaid Services (CMS) would make it harder to find specialists and follow-up care for patients. The CMS rule exempts health insurance companies from meeting minimum standards to ensure adequate networks.
  • 79% of ER doctors who are familiar with the Fair Health database say it’s the best mechanism to ensure transparency and make sure that insurance companies don’t miscalculate payments.
  • 87% say that insurance companies should pay the in-network rate when an emergency patient does not have access to an in-network facility or physician.

Kaplan said, “Health insurance companies have a long history of not paying for emergency care and…discouraging their customers from seeking it. For example, United Healthcare was sued successfully by the State of New York for fraudulently calculating and significantly underpaying doctors for out-of-network medical services. They used the Ingenix database, which forced patients to overpay up to 30% for out-of-network doctors. The company, which, at the time, was led by the acting head of CMS, Andy Slavitt — paid the largest settlement to the state of New York and the American Medical Association. Part of that settlement created the Fair Health database.”

AARP Report Reiterates Need for Fair Generic Drug Reimbursements

National Community Pharmacists Association (NCPA) CEO B. Douglas Hoey, RPh, MBA issued the following statement in response to a new report by AARP on rising generic drug costs in 2013:

“This new report…underscores the need for action by Congress to support patient access to essential medications. Moreover, a 2015 survey of 700 community pharmacists concluded that this situation has only become worse since 2013…

Patient access to these medications is threatened by more than their rising cost. Independent community pharmacies are absorbing unsustainable losses of $100 or more on these prescriptions because insurance middlemen known as pharmacy benefit managers (PBMs) may wait months to raise reimbursement rates to pharmacies to cover the higher costs.

This buy high, sell low situation threatens the viability of independent community pharmacies, which provide care in many underserved rural and inner city areas without other convenient pharmacy options. Already some pharmacies can no longer stock certain medications for patients because the reimbursement rates are so far below the cost of acquiring and dispensing them. Because of the lack of transparency, PBMs may be profiteering during…by charging health plans much higher rates than they reimburse the pharmacies.

We encourage lawmakers to cosponsor H.R. 244. This bipartisan legislation would ensure that federal health plan intermediaries, such as PBMs, update reimbursement rates for rising generic drug costs to keep pace with market conditions. It would codify and expand upon a requirement that Medicare has adopted for the 2016 plan year.”

Policymakers Overlook a Major Cost Driver

KarenIgnagniAHIP President & CEO – Karen Ignagni

Some physicians who don’t participate in health insurance networks are charging patients 10 times the Medicare reimbursement for the same service in the same geographic area. In some cases, they charge nearly 100 times more, according to a report from America’s Health Insurance Plans (AHIP).

For example, in New York, a physician billed a patient $115,625 for lumbar spinal fusion, which is 62 times the Medicare fee of $1,867. Similar examples were found in all 30 states and there are many examples of even higher variations in charges. The report is based on data gathered from Dyckman & Associates

AHIP says that public policy discussions focus how much insurers pay for these services while ignoring what out-of-network physicians are charging patients. AHIP wants policymakers to look at how these charges compare to in-network fees as well as fees charged for similar services in other countries.

AHIP President and CEO Karen Ignagni notes that consumers who get services from in-network providers usually have lower cost sharing, which has saved billions of dollars in out-of-pocket costs and premiums over the decades. For more information, visit www.ahip.org.

Last Updated 01/19/2022

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