Out-of-network (OoN) billing, or “surprise billing” consisting of unexpected charges for OoN services, is an increasingly recognized issue. In the past several years, some states have enacted laws to remediate the problem.
In 2015, New York enacted a surprise-billing law that prevents patients with health insurance from having to pay more than their in-network copay when receiving emergency services from an OoN provider at an in-network facility. Twenty-one states have laws providing limited (n = 15) or comprehensive protection (n = 6). Although much attention has been given to OoN billing in the emergency room (ER) setting, OoN billing can affect outpatient and inpatient settings, as well. A complicating factor can be determining whether a particular ER is in or out of network.
To gain insight into the problem at a personal level, we interviewed a patient who faced a surprise bill in Texas, an ER physician in Texas, a surgery center administrator in Texas, and a finance director of an orthopaedic surgery practice in New York.
The patient is a 54-year-old female professional with a doctorate in healthcare anthropology who has studied healthcare systems her entire career.
Patient: I fell in my driveway at home and fractured my wrist. I was alone, and no neighbors were home to help. I looked at my very deformed wrist and thought, “This isn’t bad enough for an ambulance, which is expensive, and I don’t know if it will be covered by my insurance.” I drove myself to the nearest standalone ER, which is two miles from my home. I was very concerned about insurance and whether my care would be covered, but I was not able to use the phone or internet to see which ERs were in network. It never occurred to me to determine this ahead of time in case of an emergency. I was the only patient at the ER when I entered; I asked two questions: “Can you take care of this?” and “Do you take my insurance?”
Authors: Were you aware of your OoN benefits?
Patient: I was aware that the deductible for OoN benefits was $10,000, but not whether the ER was in network, although I suspected there was a strong possibility it was not. I was in that ER for more than six hours and was told that they could not get hold of my insurer to verify benefits. I don’t know if I believe them, which is sad. On the other hand, I can believe that they might have trouble reaching my benefits administrator. Health insurance is hard to follow, even for someone with a PhD who has spent her career studying health and health care. I have insurance from Cigna, but if you call them, they have no idea who I am because my health insurance with them is administered by Assured Benefits Administrator. Every time I go to a new healthcare provider, it takes a while for them to figure this out and confirm my benefits.
Authors: Were you informed of your OoN benefits and payment responsibility?
Patient: Not when I was in the ER, or for more than a month afterward. I finally called the benefits administrator, only to find out that the ER was OoN. I asked the woman, “Not all ERs are in network?” She replied, “Yes ma’am, that is what it means.” I asked, “Every place I travel, I have to determine the closest in-network ERs just in case I have an emergency? It simply isn’t tenable to live life that way!”
The ER doctor covers one of the busiest Level II trauma centers in Austin, Texas, treating a broad patient population.
Authors: What are some of the biggest challenges facing ER doctors who treat patients with OoN benefits?
ER doctor: Patients have sticker shock after receiving a bill for services they didn’t know were OoN. A lot of times the ultimate diagnosis is not an emergency but the symptoms they present with certainly could represent a true emergency, like a 40-year-old with chest pain. The challenge is that we have trained the public to go to the nearest ER when they have chest pain or stroke-like symptoms, but in some cases, the patient finds out later that services weren’t covered. I find it a disservice to the patient.
Authors: Are you aware of what insurance companies are in network and OoN with your group?
ER doctor: I am not—our billing is done through a national corporation. I would say as ER physicians, we are blissfully unaware who is in network because our duty is to show up and take care of the patient.
Authors: Are you able to discuss ER billing with patients?
ER doctor: Historically, there has been concern that discussing finances with patients before signing them in and performing a medical screening was considered a violation of the Emergency Medical Treatment and Active Labor Act (EMTALA), because it may appear that you are discouraging a patient from seeking care for financial reasons. For example, if a person comes to the ER with a mild toothache and I tell them they may not want to check in because they might get a large bill and their condition isn’t really an emergency, I am violating EMTALA. This leaves me at risk for ER shutdown. It could be argued that I don’t want to see patients who can’t pay, when what I am really trying to do is prevent them from getting a large bill. We have signage everywhere that reads, “This is an emergency center, and standard ER billing applies.” That is as much as we can say.
However, in today’s market with narrow networks and consumer-driven health care secondary to large copays and deductibles, discussions about cost is commonplace and will likely be a more important part of doctor-and-patient conversations. Understanding the implications of OoN costs is important for providers to communicate to patients, particularly those with less severe injuries.
Outpatient settings such as surgery centers also have challenges related to OoN benefits. An administrator from a surgery center in Texas explains.
Authors: What is the biggest challenge you face with regard to OoN benefits and outpatient surgery?
Surgery center administrator: Patients tend to be most upset when they don’t understand or are surprised by part of the insurance process, so communication is very important. Patients can also be very confused and angry when an OoN surgery payment does not cover their in-network deductible for an in-network treatment.
Authors: What challenges does a surgery center face when providing OoN care?
Surgery center administrator: When you conduct an OoN surgery, there can be a lengthy delay in the reimbursement and appeal process. Also, higher patient responsibility for payment increases the chances the charges will not be paid fully or in a timely manner.
An interview with the director of finance from a large academic orthopaedic department revealed some important pearls, particularly in the outpatient setting.
Director of finance: What’s needed is transparency in billing—noting the charges for which the patient is and isn’t responsible. For patients seeing in-network doctors, there is no issue unless they conduct surgery or procedures and testing that may involve OoN providers or services. In these instances, patients will be notified that any additional costs incurred are OoN. This allows the patient to decide whether they want to incur extra costs if OoN services are provided. Several states other than New York have similar laws, and awareness of this problem is increasing. Additionally, a new industry of patient advocates is forming to help patients negotiate these billing issues.
In a new twist on this issue, The New York Times recently published an article (May 19, 2018) titled “As an Insurer Resists Paying for ‘Avoidable’ E.R. Visits, Patients and Doctors Push Back.” The article details how an insurer denied payment for an ER visit because the patient’s emergency care was deemed unnecessary. “Anthem denied thousands of claims last year under its ‘avoidable ER program,’” the article claimed. However, patients often cannot differentiate between life- and limb-threatening health problems versus nonurgent conditions.
The issue of surprise bills continues to gain attention as patients across the country encounter the problem weeks or months after receiving care they thought was provided entirely in network. Better communication with patients by physicians, hospitals, and insurance carriers will be required to prevent these unexpected charges.
Lee M. Reichel, MD, is an associate professor in the Department of Surgery and Perioperative Care at the University of Texas’s Dell Medical School in Austin, Texas. He is a fellowship-trained orthopaedic surgeon in hand, upper extremity, and orthopaedic trauma at Austin Region Clinic in Austin.
Robert Strauch, MD, is a professor of orthopaedic surgery at the Columbia University Irving Medical Center in New York and specializes in hand surgery.
Gregg Vagner, MD, is an assistant professor in the Department of Surgery and Perioperative Care at the University of Texas’s Dell Medical School in Austin, Texas. He is a fellowship-trained orthopaedic surgeon in hand and upper-extremity surgery and currently practices at Orthopaedic Specialists of Austin.