Consumerism and patient directed insurance design is predicated on the assumption that pricing is transparent enough and choices are clear enough that patients can make reasonable decisions about cost effective treatment. There are a number of problems with that assumption, but I want to look at one today regarding the Pathology, Emergency Medicine, Anesthesiology and Radiology specialties.
These PEAR specialties are known as “invisible” providers. Invisible providers are seldom chosen by the patient. Invisible providers were intermittently listed in provider directories when I maintained the provider directory at UPMC. Invisible providers are part of the care team but they may not be employed by the same group that employs the visible providers.
Visible providers are the doctors that a patient can choose. My primary care provider is a visible provider. My wife’s Ob-Gyn is a visible provider. My former orthopedist is a visible provider. My mom’s neurologist is a visible provider. The hospital down the street with an ER is a visible provider. These are the providers where clear in and out of network designations occur.
The New York Times had a great article a study that examined the deliberate business strategy of a PEAR staffing agency to increase the number of out of network ER bills:
the new Yale research, released by the National Bureau of Economic Research, found those bills aren’t randomly sprinkled throughout the nation’s hospitals. They come mostly from a select group of E.R. doctors at particular hospitals. At about 15 percent of the hospitals, out-of-network rates were over 80 percent, the study found. Many of the emergency rooms in that fraction of hospitals were run by EmCare.
It is a deliberate business strategy to exploit the rottenness of the PEAR billing arrangements for profitability. Patients don’t know that the hospital is in network and most of the docs who work there are in network but the ER doctors or anethesologists are not.
The thing that leaped out at me was the deliberateness of the business strategy:
n addition to its work in emergency rooms, EmCare has been buying up groups of anesthesiologists and radiologists.
This is an exploit of the inability of people to make informed decisions in order to jack up rates.
What is a solution?
There are two common solutions. The first is to have states adapt out of network pricing limitations and dispute resolution systems. If out of network charges are capped at a multiplier of Medicare or a multiplier of usual and customary, the incentive to exploit a crack like this goes down dramatically. The other solution is to adapt a general contractor model for all emergency room services where the hospitals’ contractual obligations cover all service providers working under that roof. If someone presents to the emergency room with a broken arm, anyone who treats that patient, under this model, is assumed to be in-network if the hospital is in network.
As we move to a shopping model of health care, we need to get rid of the amazingly and glaringly obvious exploits and hacks to the system that do nothing for patient care but add significant expense and frustration.
This seems like an obvious thing to do. I had not actually thought this through before. I assume there are reasons this would be resisted?
Mildly disappointed that your solution doesn’t involve lining up EmCare’s C-level suits against a wall and shooting them.
I have long raged about this. It is so simple, so obvious, ergo it will never be done.
@Steeplejack: Cheer up! That scenario may be nearer than you think, if the Republicans get everything they want. They’re still a minority, yet seem to forget that that’s the case. When things go sideways there’s no telling where things will end.
David, what do you recommend individuals do to protect themselves from this? Have the patient (or responsible party if patient is unresponsive) ask to only have treatment from in-network doctors? Ask for a modification before signing any agreement to indicate this demand?
I had a minor outpatient surgery on a finger a couple years ago, and at check-in I specifically asked if all the providers were covered by my insurance, and the intake person had no idea and said she couldn’t make any statement about that. The system is not set up to deal with corporations who see people at their most vulnerable as another profit center.
Boy Scouts disavow!
@SP: I don’t know what a patient can do… Get it written down that you only want to be treated by in-network docs might help but I don’t know….
“As we move to a shopping model of health care…” — and that’s the problem, ladles and jellyspoons.
Disavow, bullshit. As one commenter said, that statement is a ¯\_(ツ)_/¯.
as the comments reflect.
Weak as phuck.
@raven: Should I assume your tongue is firmly in cheek? Because that statement was utterly lacking anything that might even remotely be akin to a disavowal.
This goes for outpatient medical centers as well. I read the other day that 99.6% of eye surgery is done at outpatient centers– and chances are excellent that you will get a separate bill from an anesthetist for your cataract surgery. And yes, you need anesthesia for eye surgery, and no, you are not offered any choices about who performs it.
A little OT: The Conservative Case for Universal Healthcare
I think he is more than a little Pollyanna-ish in his forecasting of GOP acceptance of it, but he makes the argument in it’s favor.
This has been my dream scenario: Have a non-life threatening but bloody ER visit and while dripping conspicuously on the ER floor loudly demand that all providers be in-network.
Some enterprising lawyer should draft up a card for patients to carry and present that says essentially that by providing any care, the hospital accepts that all charges are in-network.
@OzarkHillbilly: He seems to think that Republicans will cave on single payer before Democrats. My assumption is that if some version of this monstrosity makes it into law, Democrats will stop trying to push technocratic solutions and go for the simple version of health care reform. I have some issues with that, but they are themselves technocratic and could be tinkered with over time.
To the original post: The legislative solutions should not be either/or, but both. If the insurer does not have a contract, then a percentage of Medicare. If it does have a contract with the hospital, it should cover all service providers including anesthesiologists and other doctors who become parasites on their patients, who have no ability to control who provides services in those contexts. Hospitals have complete control over who they contract with. If they told anesthesiologists they have to have contracts with any payer that the hospital does, this practice would end, overnight. An alternative would allow insurers to deduct out of network fees paid to hospital based physicians from hospital compensation. I have actually seen this happen, prospectively, where a large insurer explains to a hospital that it would love to pay more, but they are going to deduct what they had to pay to doctors under contract with the hospital but not under contract with the insurer. Hard ball. In that case it worked out pretty well.
Villago Delenda Est
This is a classic example of “assume makes an ass out of you and me”.
Villago Delenda Est
@OzarkHillbilly: If our “conservatives” were actually conservative, and not moralistic scolds who seek a return to a golden age that exists only in their twisted imaginations, they’d see that single payer/socialist health care is the most economical and morally correct model existing.
But they’re moralistic, greedy scolds.
Snarki, child of Loki
“Some enterprising lawyer should draft up a card for patients to carry and present that says essentially that by providing any care, the hospital accepts that all charges are in-network.”
You need to get a tatoo with the EULA. “Stick a hypodermic here if you agree to these terms…”
@MattF: yes, that was exactly my experience. I had cataract lens implants and got separate bills for the anesthesiologist. Out of network, of course. Another problem is getting the insurance wrong. I was in-patient at an in-network hospital and had a ultrasound done. Somehow the Radiology group got my insurance info wrong and they were about to send it to collections when I figured out that they never submitted it to my insurance.
@Snarki, child of Loki: And if the hospital tries to argue sue for an EMTALA violation. Hounding patients about money in the ER can be a violation of EMTALA.
I’m sure you’ll be happy to name an actual crime of which they are guilty.
That is true in the vast majority of cases, but it is not inevitably true. I asked my opthalmologist’s office to make sure the anaesthesiologists were in-network, and they did. $74/eye.
Fuck. The gotchas we gotta deal with having this fucking system.