Amen — need to get clearer contracting on the insurer-provider side plus rebuild claims systems to allow loc bills https://t.co/ACG5naEGfo
— Richard Mayhew (@bjdickmayhew) March 21, 2016
This was the tail end of a long discussion about how to systemically get surprise bills out of realm of the common and into the realm of myth. The current set of laws like the New York surprise bill dispute resolution law is a post-facto attempt to not completely screw over patients and their families. It eliminates some of the gold mine that doctors and hospitals can strip mine but the process is long and painful. It is a good attempt to treat a symptom without getting at the underlying root cause.
An emergency room visit is almost guaranteed to trigger two claims for the simplest possible visit. The first claim is the institutional/facility claim where the hospital charges the patient for using the space. The second claim comes from the doctor who sees the patient. This is the simplest ER claim. More complicated ER visits can generate even more unique claims including lab, radiology and surgery claims. If someone has surgery, there is a possibility of an out of network assistant surgeon plus a separate anesthesiologist charge.
This is too complicated. This confusion is how surprise medical billing can easily occur. An individual can think that they are doing everything right and drive past an out of network hospital to get to an in-network ER and still get hit with surprise out of network charges.
There are two long term fixes. The first is a significant change in contracting relationships between hospitals and insurers. Right now, every medical professional in an ER can be acting as an autonomous atom with no required relationship with a particular insurer. The hospital is mainly concerned about getting heads in beds to run revenue through their facility charges, room charges and then through whatever services the hospital directly provides. The hospital is merely a contracting entity and foci of high end medical care. It is not an active agent in managing care.
The relationship change is to move the hospital to that of a general contractor where an ER visit is a single bundle payment with appropriate modifications for complications and complexity of the visit. An asthma attach should be paid far less than a heart attack or a sucking chest wound. However that bundle payment will be split in whatever proportion that the general contractor so decides. That means if an out of network radiologist reads an X-ray, that is the hospital’s problem (and loss center) instead of the patient’s problem. The entire concept of an out of network specialist for an ER visit becomes obsolete. If the hospital is in-network, every claim associated with the ER visit is in-network. The same logic would apply to surgery. The surgeon would become the bundle recipient and general contractor. For that one particular instance, anyone who touches that particular patient would be considered in network.
The insurance side needs to change as well. Right now most insurers pay claims based on a combination of Tax ID Number (TIN), place of service (POS) code, National Practitioner ID (NPI), CPT-4 codes (procedure codes), modifiers, ICD-10 diagnosis codes and a few other boxes on a standard claim. There are a few claim payment systems that tie a claim to both an episode and a particular location but not many. Claims systems will need to be rebuilt or replaced so that every claim that is attached to a particular instance can be pooled together. From there, actually paying bundled payments to a general contractor is plausible. Until the systems are rebuilt, tying claims to instances is difficult which means paying for an instance with a single payment is difficult as well.