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Life Health > Health Insurance

Agent Group Fights Big Out-Of-Network Doctor Bills

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NU Online News Service, May 3, 2004, 6:13 p.m. EDT – The California Association of Health Underwriters, Sacramento, Calif., is trying to protect members of managed care plans from huge, unexpected hospital charges.[@@]

CAHU is lobbying for Assembly Bill 2389, a measure that would require health plans and hospitals to include provisions for payment of most “nonpreferred providers” in preferred provider contracts.

The amended version of the bill would not apply to emergency room departments or ER doctors.

CAHU is sponsoring the bill, which was written by Assemblymember Paul Koretz, D-West Hollywood, Calif., because many CAHU members have heard complaints from insured consumers about receiving big bills from out-of-network anesthesiologists, radiologists, pathologists and other specialists who helped care for them while they were in in-network hospitals, CAHU says.

Providers who sign preferred provider contracts usually agree to give up on “balance billing,” or trying to collect amounts over the standard rates negotiated with the carriers. If an in-network pathologist bills a patient for $10,000 but the preferred provider contract limits the charge to $2,000, the pathologist usually avoids trying to collect the additional $8,000 from the patient.

When doctors treat out-of-network patients, the doctors can balance bill the patients for any amounts not paid by the patients’ insurers. An out-of-network pathologist, for example, might collect $2,000 on a $10,000 bill from an insurer, then bill the patient for the remaining $8,000.

In many cases, hospitals, out-of-network specialists and health plans all fail to warn patients about the possibility that out-of-network providers might end up balance billing them, CAHU says.

A few years ago, providers and carriers showed some willingness to help clear up payment problems involving out-of-network specialists, but, today, “carriers are being tougher in applying out-of-network rates to doctors,” says CAHU President Jeff Miles.

Meanwhile, the doctors’ billing people usually refuse to negotiate, and the doctors often “don’t know and don’t care” about the problems, Miles says.

The California Society of Pathologists, Sacramento, has opposed A.B. 2389, calling it a “forced contracting mandate.” The California Healthcare Association, Sacramento, a major hospital trade group, also has opposed the bill.

But the California Assembly Health Committee recently voted 14-1 to approve the bill.


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