Over the past year or so, a troubling trend has been reported in various media outlets: Some health insurers are denying claims from members who visited the emergency department for what they believed were actual emergencies. These policies involve the insurance company retroactively examining claims and approving or denying payment based on whether or not the incident was deemed a true emergency.
The problem is, most people aren’t trained in medicine and don’t know whether that pain in the belly is a burst appendix, which requires immediate medical intervention, or something harmless, such as gas pains that will pass on their own. Erring on the side of caution, many people go to the emergency room for an expert opinion. But even with health insurance, an increasing number of patients are finding out they’re on the hook for a very large bill, but only after the insurance company has had an opportunity to review diagnostic tests that the patient didn’t have prior to making the decision to visit the emergency department.
[See: 10 Questions Doctors Wish Their Patients Would Ask.]
The American College of Emergency Physicians reports that certain insurers are keeping a list of “secret” diagnostic codes that, when tagged in a reimbursement submittal, will get the claim tossed out. The ACEP is raising the alarm that these sorts of policies may become standard across the industry if insurers who are enacting such policies aren’t challenged, arguing that not using a measure called the “prudent layperson standard” violates federal law and discourages patients from seeking emergency care when they need it.
The “prudent layperson standard,” is the measure by which most emergencies are determined to be emergencies, says Salvatore G. Rotella, Jr., partner at Buchanan Ingersoll & Rooney, PC, a full-service law firm based in Pittsburgh. Rotella is a health care attorney in the firm’s Philadelphia office who represents health care providers in payment disputes with insurance companies. “The idea is, ‘what would a normal person think?’ If you or I woke up and had intense pain in the left side of the chest and couldn’t breathe, we might reasonably think we’re having a heart attack. And even if it turns out to be gas pains, you wouldn’t get dinged for going to the emergency room to get it checked out” if your health insurance policy uses the prudent layperson standard as its benchmark for analyzing claims. “The visit would be paid for. Whereas if you woke up and your foot hurt, a prudent layperson wouldn’t think, ‘I’m going to the ER because I think I’m having a heart attack.’ To a prudent layperson, a bit of pain in the bottom of your foot doesn’t mean you’re having a heart attack.” And if you did go to the ER, it seems reasonable that you might be on the hook for paying the bill out of pocket.
For years, the prudent layperson standard is how most insurance companies measured whether to pay for services rendered at emergency departments. It’s even included as the measure of emergency in the federal law , says Dr. Vidor Friedman, president-elect of the American College of Emergency Physicians and an emergency physician at Florida Hospital in Orlando. “What I try to remind people is that it’s the Patient Protection and Affordable Care Act [aka Obamacare] — most people leave out the first two words, but I think it’s kind of important. That law actually stipulates that insurance companies are supposed to pay for emergency care based on the prudent layperson standard, but insurance companies are saying, ‘we’re not going to do that,’ and unfortunately it’s hard to hold them accountable,” in part because health insurance is regulated at the state level, not the federal level. “So there’s this disconnect,” he says.
Plus, “your insurance policy is basically a contract between yourself and your insurance company,” Rotella says. This means that although it might seem shady, and policies denying claims could potentially violate federal law, if the contract says the insurer may deny claims in this manner, then it may technically be legal for the insurer to do so. Therefore, Rotella says, “the question is really, ‘does their policy provide for it?'” If the insurer wants to refine its definition of a “prudent” person or change how it assesses claims, it can probably do so provided such is disclosed in the policy.
So how did we get here, to a point where health insurance, which is supposed to cover us when we’re sick or hurt, might not be as helpful in times of crisis as expected? At its core, the issue is one of trying to control costs. Overuse of emergency rooms by people who don’t have a primary care physician has led to some of these policies. But, in some cases, such policies are hurting people with legitimate emergencies rather than catching so-called frequent flyers who are abusing the system.
“There have been many attempts at setting up urgent care centers and other ways to try to dissuade people from using the ER as their primary care doctor,” such as higher copays to visit the ER, “because ER visits end up costing the system a fortune,” Rotella says. But these policies of retrospectively determining whether a visit was an actual emergency is catching many people who in good faith thought they were having a real crisis. “We’re supposed to be encouraging people, unless they’re being patently unreasonable, to go to the emergency room when they think they’re having an emergency. Some of them will turn out to be no big deal,” but it’s difficult to know which is which in the moment.
Part of the issue is that emergency care is expensive, and the number of visits has been climbing. A 2018 report from the Agency for Health Care Research and Quality noted that “the rate of [emergency department] visits per 100,000 population reached a 10-year high in 2015 for all age groups and increased the most for patients aged 45-64 years (20 percent, from 2006).”
[See: HIPAA: Protecting Your Health Information.]
Another aspect of the cost issue dates back to 1986, when Congress passed the Emergency Medical Treatment and Labor Act. That law requires hospital emergency departments to medically screen every patient seeking emergency care and to stabilize and transfer patients with medical emergencies regardless of whether the patient has health insurance or the ability to pay for that care. The law is considered an unfunded mandate, meaning the federal government doesn’t provide any compensation to facilities that are unable to collect payment for services rendered in accordance with the law. But the ideal behind the law is that “anyone on American soil — anyone — has an absolute right to be cared for in an emergency department, and emergency departments cannot ask if the patient has the means to pay for that care until after the patient is at least stabilized,” Friedman says. Being left to collect payment on the back end means the hospital or the doctor may end up having provided those services for free or at a very reduced rate if the patient can’t pay or has limited ability to pay.
Friedman says “70 percent of the patients that we take care of have some sort of coverage, either commercial insurance [through an employer], Medicare, Medicaid or TRICARE,” which is an insurance program for military personnel. “So most of the people who go to the ER have some sort of coverage. The problem is a lot of those patients have less-than-adequate coverage and that’s where these ‘surprises’ come in.” That surprise is two-fold, Friedman says, with the patient finding out the insurer won’t cover the emergency added to the realization that there’s a large personal responsibility for having sought care.
If the hospital can’t recoup its costs, that can make keeping the doors open to treat other patients challenging. Medical supplies and appropriately trained staff to use them require money, and that’s where things like “facility fees” come in. These are sometimes very high fees that patients are charged just for walking into the emergency department. These facility fees attempt to recoup costs from patients who can pay, hopefully offsetting the cost of care and supplies consumed by patients who can’t pay.
“In the bigger scheme of things, there’s a desire to pay less for health care in this country, and we could.” But denying good faith emergency claims after the fact “is not the way to do it,” Friedman says. Regardless, he says policies and concerns about payment don’t enter the conversation with patients while care is being delivered or alter the way he or most other emergency physicians practice. But financial concerns are a fact of life that’s making working in the field more challenging. “It is definitely increasing the stress level for emergency physicians,” Friedman says.
So what should you do if you’re experiencing an emergency and are concerned about the potential cost of seeking care? “Patients need to make decisions not on the basis of whether their health insurance is going to pay for it or not. If they feel they have an emergency they need go to an ER: end of discussion,” Friedman says. To avoid finding yourself on the hook for a surprise bill after the fact, “my suggestion would be to write your employer, write the Better Business Bureau, write to the newspapers. Patients are going to have to advocate for themselves.”
Rotella also recommends that you carefully read your health insurance policy. Rather than simply opting for the plan with the cheapest premium, take a look at what the policy actually covers. It can be confusing, but find out what’s in the policy so that you know what you’re buying.
[See: 14 Things You Didn’t Know About Nurses.]
And if you get stuck with a bill that you think should have been covered, appeal the decision. “Almost all insurance policies will have some kind of an internal appeals process. Either the patient takes it or a doctor or the hospital might appeal on the patient’s behalf to reconsider its denial. If that doesn’t work, you can pursue arbitration or a lawsuit. If you have a strong case and you think a judge would agree with you,” that might be a good option, but Rotella says it’s difficult for individuals to really push this angle because “it takes time and money to get to that point.”
But legal pushback and public outcry may be the best way to prevent insurance companies from continuing or expanding these sorts of policies, Rotella says. “Until someone brings a legal challenge, there’s really nothing to stop insurance companies from testing the water by taking a hard line and denying claims.”
More from U.S. News
14 Things You Didn’t Know About Nurses
HIPAA: Protecting Your Health Information
10 Questions Doctors Wish Their Patients Would Ask
Why Some Patients Get Unexpected Bills After Emergency Room Visits originally appeared on usnews.com
