You are right to start the dialog about “Balance Billing” as I am very sure that it will be a hot topic this coming session. I have started to craft legislation to address this issue.
To begin with, there are two ways to address this issue in my opinion.
The first is to fight it (which would be a strictly defensive battle) and explain why it would be anti free market as well as cause all health care providers to be under the direct control of the insurance industry.
The second way (and I believe the best way) is to be pro-active by controlling the narrative and establish the truth of what balance billing is and why it occurs.
Balance billing is not a product of greedy health care providers but rather it is a result of anemic reimbursements from the issuance carriers.
Balance billing (with very few exceptions) is caused when the insurance industry tries to force providers into a forecasting mold that allows them (the carriers) to take very little actual risk since the providers will be forced to charge exactly what the carriers set aside for reimbursements.
(Its a very similar model to the gaming industry whereas they establish the returns they expect before they set the payout system for the slot machines, the house never looses)
We must never loose sight of the true definition of health care which is: “The relationship between a provider and the patient”. Insurance companies are ancillary to this definition and the health care industry.
Following the true definition of health care, insurance companies should insure the patient based on the health care industry rather than the heath care industry providing services base on the insurance companies business model.
Virtually no health care provider would ever seek to balance bill a patient if they received fair, market based reimbursements for their services.
Therefore, the answer to the balance billing issue is to remove the cause for balance billing to occur in the first place.
To try and artificially solve the balance billing issue by simply outlawing the ability for providers to collect what is owed to them would create more problems than it would ever solve.
If balance billing were to be prohibited the following problems would arise:
1) All health care contracts would be extinct. Since providers would be only allowed to collect an amount equal to the amount that insurance carriers were willing to reimburse, by default all health care providers would be in a “defacto contract” and they would be totally at the mercy of the carriers for payment.
2) If the competition between contracted and non contracted providers ever goes away, we will be left with a socialized health care system controlled by the carriers, the government or both. Providers would only be able to affect reimbursements through unionization of the profession and/or collective bargaining through sheer strength of size.
3) The elimination of a competitive health care system would no longer allow for the industry to attract the best and brightest minds in the country because their potential would be pre-determined and controlled by an ancillary industry.
This would be a kin to the insurance industry telling the automotive industry what models of cars they can build rather than the auto industry responding to what car buyers want.
4) The elimination of balance billing would have the effect of price fixing since charges could never exceed what carriers wanted to pay and have nothing to do with what it might cost a physician or facility to provide that service. (Federal law could come into play)
To defeat the efforts of the insurance lobby during the upcoming legislative session, we must not engage in a defensive battle based on their narrative.
We must defeat the insurance lobby efforts by controlling the narrative as to what truly causes balance billing and attacking that issue, which is anemic, unfair reimbursements for services rendered.
Can you imagine the implications if health care providers did not have to balance bill as well not have to employ the armies of administrative staffs trying to collect from insurance companies?
Baker Hostetler Health Law Update:
The intent of HB 616 is to address four major issues, which are paramount to the Texas healthcare system, and which presently are addressed by only the insurance companies leaving the healthcare providers at the mercy of their determination.
IMPORTANT: PARTICIPATION IS VOLUNTARY FOR PROVIDERS!
MAJOR ISSUES ADDRESSED:
Involvement in Campaign Process:
PCCOT and its team are working in numerous campaigns across the state of Texas to make sure that we assist in electing officials who not only understand our issues but also are willing to fight for them. Many organizations make the mistake of not taking the time to meet with and assist officeholders/candidates in their home districts. PCCOT spends a tremendous amount of time and resources to make the elected official know us, including House of Representative races, Senate races, as well Attorney General, Lt. Governor and Governor of Texas. These efforts include everything from putting up yard signs, knocking on doors for the candidate and hosting fundraisers. To date, PCCOT and its members have raised over $200,000 for candidates and we are still scheduling more events.
Delisting of Physicians:
As most of you are aware, insurance companies have been working tirelessly keeping patients in-network. One of the ways that they have attempted to do this is to threaten the physician with loss of contract for making referrals to out-of-network facilities/physicians. Recently, onerous rules & regulations have been imposed on the referring physician which are designed to dissuade the patient from using their out-of-network benefits. In 2008, Blue Cross Blue Shield tried to do the same thing to its policyholders and physicians. PCCOT brought this to the attention of the Attorney General as well as the Texas Senate. This strategy resulted in the issuance of a cease and desist letter from Senator Robert Deuell as well as the Texas Attorney General levying a fine on Blue Cross for past transgressions. (Blue Cross has stopped delisting efforts.) Since then, the CEO’s of Aetna and Cigna have received cease and desist letters from Senator Deuell in regards to their efforts to steer patients to only in-network facilities. PCCOT has drafted new legislation that would prohibit these delisting tactics in the future and is poised to introduce it in the Texas Senate and House of Representatives during the 2015 legislative session.
Reimbursements to Out-of-Network Facilities/Physicians:
Insurance companies are intent on selling higher priced PPO policies, but reimbursing out of network facilities/physicians at HMO rates. When a patient who is a PPO policy holder utilizes the out-of-network component of their health insurance plan, there are the expectations that higher premiums and co-pays associated with the plan will be the cost for going out-of-network. What they do not expect is the unpaid balance (balance billed amount) that results from their insurance company paying the facility/physician is much less than the market rate for their services. This leaves the patient on the hook for what the patient believes is covered under their plan. PCCOT has introduced legislation that would require the insurance companies to comply with market based reimbursements using a charge based methodology tracked and confirmed by a fair health database. If they do not comply, they must clearly spell out in the insurance policy that they will reimburse for procedures and what will be the out-of-pocket responsibility to the patient. Free mark reimbursements will facilitate a competitive health care system whereas out-of-network providers will compete with in-network providers on a level playing field, thus insuring quality health care for all patients. Transparency in what the insurance companies reimburse will allow the patient to make informed decisions when not only selecting a healthcare facility but also a healthcare insurance policy.
PCCOT has and continues to work with the Texas Department of Insurance (TDI) on rule-making and interpretations to our members’ benefit, as well as the Texas Attorney General to enforce existing laws on the books as well as identify what can be done to hold insurance companies accountable. The Attorney General has opened two Civil Investigation Demands as a result of PCCOT’s efforts whereas an ongoing investigation is underway targeting Cigna as well as Aetna for unfair reimbursements to out-of-network providers. In fact, PCCOT has filed a formal complaint with TDI on behalf of many of its members to cause insurance companies to reimburse on outstanding account receivables and follow current newly enacted TDI rules. As a direct result of work of PCCOT, the Chairman of the House Insurance Committee held an “interim study” in December 2014 specifically addressing their issues and also develop solutions.
PCCOT has introduced a bill to stop the insurance companies at the source or beginning of our problem with reimbursements. The contact the insurance companies live and die by is the one between the themselves and the policyholder. Because of this, we find ourselves fighting alone to collect fees which are not specifically addressed in that contract and therefore must pres the issue of “reasonable and customary” without direct contractual support. In virtually all cases, the PPO policy holders do not have a clue what their financial exposure is for a procedure and their policies are written in a way in which they “appear” to cover out-of-network claims in the same manner as in-network claims in as much as their additional financial exposure is covered in the higher premiums they pay. This legislation seeks to end this “smoke and mirror” policy and make the insurance companies clearly explain what they are selling to the consumer. It is PCCOT’s belief that IF the consumer KNOWS what type of financial risks they are exposing themselves to, then the policies that are now being sold (which have very limited out-of-network benefit) will have no market and consumers will demand policies that reflect free market reimbursements.
Legislators Engaged and Informed:
The PCCOT team of loybyists is continually working to inform legislators about the current state of healthcare and how the out-of-network component is under attack. It is our mission to make sure that they realize that competition breeds excellence in healthcare, and the only way to have competition is for the out-of-network facilities/physicians to be profitable and viable through a truly free market system. As is evident by talking and working with legislators since the formation of PCCOT, most legislators were not even aware of the problems and tactics of the insurance companies towards out-of-network facilities and their importance to a quality healthcare system. Physicians have seen a steady erosion of reimbursements over the last decade due in part to legislators not knowing what was going on in our healthcare system, and only hearing the insurance companies espousing their side of the equation. For the very first time, Texas out-of-network facilities and physicians have a strong proactive voice at the Capitol in PCCOT. They advocate on issues that effect both physicians and patients alike. The only way for patients to have access to quality healthcare is through a free market approach. Through this type of approach, healthcare will continue to be competitive, innovative and continue to attract the best and brightest students in our college and universities into medicine. After all, the United States did not attain the status of having the best healthcare system in the world by having insurance companies run roughshod or having government over-intrusive regulations. It attained the distinction for attracting the est and brightest into the healthcare profession in spite of these two entities.
When we think of the fight we have undertaken as PCCOT to inform the legislature about the issues affecting not only physicians but also patients in quest of quality healthcare and the battles that have been won and lost, the quote from Reverend Martin Luther King is appropriate: “If you can’t fly, then run; if you can’t run, then walk; if you can’t walk, then crawl; but whatever you do, you have to keep moving forward.”
All physicians and healthcare facilities should be members of PCCOT, and the best way to achieve this is to spread the word that PCCOT is fighting for them in the Texas Legislature!