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Clinical Laboratories and Pathology Groups

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Clinical Laboratories and Pathology Groups

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Are Clinical Laboratories Prepared to Cope with Outrage Over Surprise Medical Billing? Patient Access Management May Be an Effective Solution

Consumer demand and federal requirements for price transparency affect how clinical laboratories and anatomic pathology groups meet patients’ expectations while navigating complex payer agreements

Regardless of a clinical laboratory’s payer mix and revenue cycle management (RCM) system, the demand for greater price transparency impacts laboratory services just as it does other healthcare services. Addressing new federal policies that support price transparency may require medical laboratory managers to alter how they approach RCM and patient communications.

Patient access management (PAM) is what some early-adopter medical labs and pathology groups are using to respond to these new federal policies and changing patient expectations. PAM can be an effective tool to fulfill complex payer requirements and implement consumer-friendly healthcare services. Not only does this comply with federal guidelines, it helps independent laboratories increase revenue by lowering denial rates.

How and When Clinical Laboratories Should Implement Patient Access Management

Revenue cycle experts say clinical laboratories are in a position to take an active role in the pricing transparency debate.

“If labs don’t control the pricing narrative, someone else will,” stated Walt Williams, Director of Revenue Cycle Optimization and Strategy for Quadax, a firm that has studied revenue trends in healthcare for more than 40 years, in an exclusive interview with Dark Daily.

He says, given these new demands on clinical laboratories and pathology groups, implementing patient access management practices ensures a satisfactory patient and physician experience and reduces the financial risk related to trends in uncollected revenue.

“In this age of increasing consumerism—along with the complex challenges of navigating the payer landscape and pre-empting administrative denials—it’s no wonder independent labs are turning to new patient access technology solutions to avoid leaving money on the table,” Williams said.

Patient access management solutions allow clinical laboratories to:

  • obtain accurate patient demographic information,
  • verify insurance coverage and eligibility, and
  • gain clarity on payer rules regarding prior authorization and medical necessity.

These capabilities enable medical laboratories to secure appropriate reimbursement closer to the date of service. PAM also can provide the ordering-physician with financial counseling and guidelines on a patient’s financial obligation. This would be shared with the patient to help prevent surprise billing.

New Fact of Life for Labs: Patients Are the New Payers

Medical laboratory patient-access representatives must employ proper patient-liability collection techniques before, during, and after each date of service. This has become increasingly challenging as more patients join high-deductible health plans (HDHPs) and take on more financial responsibility. The problem for labs is that meeting the expectations of consumers requires a different toolset than meeting the needs of complex payer requirements.

Additionally, evolving policies in prior authorization, medical necessity, and coding (see, “Labs Get High Denial Rates Under New NCCI Rules,” The Dark Report) are resulting in potential payment traps for patients and known revenue traps for providers and suppliers.

In its research into trends in healthcare access and affordability, the Peterson Center on Healthcare and the Kaiser Family Foundation (KFF) created the Health System Tracker to monitor consumer spending and surprise medical billing, among other points of interest.

The graphic above, taken from a KFF Health Tracking Poll conducted in 2018, lists “unexpected medical bills” as the top financial fear among Americans. “Four in 10 (39%) insured adults ages 18-64 say there has been a time in the past 12 months when they received care from a doctor, hospital, or lab that they thought was covered and their health plan either didn’t cover the bill at all or covered less than they expected,” the KFF poll notes. This illustrates the critical importance for clinical laboratories to implement patient access management protocols. (Graphic copyright: Kaiser Family Foundation.)

While the current high cost of healthcare will likely continue for some time, publishing information about the lab’s policies can help consumers view choices when it comes to selecting laboratory tests and anticipating potential payment obligations.

Henry Ford Health System, for example, posted information about prior authorization as it relates to its pathology and laboratory services.

Consumer-Facing Price Transparency and CMS Requirements

Rooted in price transparency regulations issued in July 2018, the federal Centers for Medicare and Medicaid Services (CMS) encouraged “all providers and suppliers of healthcare services to undertake efforts to engage in consumer-friendly communication of their charges to help patients understand what their potential financial liability might be for services they obtain, and to enable patients to compare charges for similar services. We encourage providers and suppliers to update this information at least annually, or more often as appropriate, to reflect current charges.”

The questions below, which CMS posed for comment in “Hospital Outpatient Prospective Payment-Notice of Proposed Rulemaking” (CMS-1695-P), may help lab managers tasked with making price transparency program decisions. They include:

  • How should we define “standard charges” in provider and supplier settings? Is the best measure of a provider’s or supplier’s standard charges its chargemaster, price list, or charge list?
  • What types of information would be most beneficial to patients … enable patients to use charge and cost information in their decision-making?
  • How can information on out-of-pocket costs be provided to better support patient choice and decision-making? What can be done to better inform patients of their financial obligations?
  • What changes would need to be made by providers and suppliers to provide patients with information on what Medicare pays for a particular service performed by that provider or supplier?

These considerations and more can help the development of patient access management and consumer-friendly communication initiatives that are tailored to clinical laboratory services.

Patient Access Management for Clinical Laboratories

Patient access management facilitates critical components of the revenue cycle. However, it must be fine-tuned to fit each healthcare provider’s unique revenue cycle process. This includes clinical laboratory and anatomic pathology services.

“Having business rules and workflows based on best practices to verify patient demographics, support insurance discovery, and navigate prior authorizations are now a minimum requirement for any healthcare provider to maintain financial viability,” Williams notes.

To help clinical laboratories fulfill CMS’ patient access guidelines—including best practices for reversing the trend of uncollected revenue—a free white paper titled, “Patient Access Antidote: Retaining More Revenue with Front-End Solutions,” has been published by Dark Daily in partnership with Quadax.

The white paper will provide useful insights regarding front-end patient access management. And it will equip clinical laboratories and pathology groups with the expert tools and solutions they need to optimize their cash flow and successfully meet key revenue cycle objectives.

Download it here.

—Liz Carey

Related Information:

WHITE PAPER: Patient Access Antidote: Retaining More Revenue with Front-End Solutions

Undertaking CMS Efforts to Engage in Consumer-Friendly Communication

An Examination of Surprise Medical Bills and Proposals to Protect Consumers from Them

Kaiser Health Tracking Poll – Late Summer 2018: The Election, Pre-Existing Conditions, and Surprises on Medical Bills

Labs Get High Denial Rates Under New NCCI Rules

Yale Study Finds Obtaining Personal Medical Records from Hospitals Can Be Difficult for Many Patients

The researchers also found unnecessarily confusing policies and procedures for requesting medical records, such as clinical laboratory test results

Clinical laboratories and anatomic pathology groups looking for ways to improve their customers’ experience should give high priority to ensuring patients have easy, accurate access to their own health records. This would, apparently, set them apart from many hospital health networks if a recent study conducted by Yale University School of Medicine is any indication.

Conducting their research from August 1 through December 7, 2017, Yale researchers evaluated the medical records processing policies of 83 top-ranked hospitals located across 29 states. They found that patients attempting to obtain copies of their own medical records from various hospitals often faced unnecessary and confusing hurdles. They also found serious noncompliance issues with regards to the Health Insurance Portability and Accountability Act of 1996 (HIPAA).

The Yale researchers published their full report in JAMA Network Open, a general medical journal published by the Journal of the American Medical Association (JAMA).

Overwhelming Inconsistencies in Policies and Procedures

“There were overwhelming inconsistencies in information relayed to patients regarding the personal health information [PHI] they are allowed to request, as well as the formats and costs of release, both within institutions and across institutions,” said Carolyn Lye, a medical student at the Yale School of Medicine and first author of the study, in a Yale News article. “We also found considerable noncompliance with state and federal regulations and recommendations with respect to the costs and processing times associated with providing access to medical records.”

“Stricter enforcement of the patients’ right of access under HIPAA is necessary to ensure that the medical records request process across hospitals is easy to navigate, timely, and affordable,” study first author Carolyn Lye (above), told Yale News. “We are also in an era in which patients are participants in their own healthcare. Inhibiting access for patients to their own medical records with complicated, lengthy, and costly request processes prevents patients from obtaining information that they may need to better understand their medical conditions and communicate with their physicians.” (Photo copyright: Twitter.)

The researchers collected release authorization forms from the hospitals by calling each hospital’s medical records department. During the simulated patient experience, they questioned the hospital policies regarding:

  • Requestable information (including entire medical records, medical laboratory test results, medical history, discharge summaries, physician orders, consultation reports);
  • Available release formats (pick up in person, mail, fax, e-mail, CD, online patient portal);
  • Costs associated with obtaining the records; and,
  • Processing times.

The team found inconsistencies between information provided on written authorization forms and the simulated patient telephone calls, as well as a lack of transparency.

On the paper forms, only 44 hospitals (53%) had an option for patients to acquire their entire medical record. However, on the telephone calls, all 83 of the surveyed hospitals provided that option.

The researchers also discovered discrepancies in the information regarding the formats available for patient records. For example, 69 (83%) of the hospitals stated during the phone calls that patients could pick up their records in person, while only 40 (48%) of the hospitals said patients could do so on the written release forms. Fifty-five (66%) of the hospitals told callers that medical records were available on CD and only 35 (42%) of the hospitals provided that option on the written forms.

Similar discrepancies between information provided in phone calls versus paper authorization forms were found relating to other formats included in the study as well.

Excessive Fees Exceed Federal Recommendations

Hospitals are allowed to charge a modest fee for the release of medical records. But the researchers found quoted costs varied widely among surveyed hospitals.

On the written authorization forms, only 29 (35%) of the hospitals disclosed the exact costs associated with obtaining medical records. The costs for a hypothetical 200-page record from these hospitals ranged from $0.00 to $281.54. During the phone calls, 82 of the hospitals disclosed their fees, with quotes for obtaining a 200-page record ranging from $0.00 to $541.50.

The federal government, however, recommends charging patients a flat fee of $6.50 to obtain electronically maintained medical records. Forty-eight (59%) of the hospitals surveyed exceeded that charge.

Access Times Also Vary

The time hospitals needed to release patients’ medical records also varied, ranging from same-day to 60 days—with electronic data tending to be delivered fastest. Federal regulations require medical records to be released within 30 days of the initial request, though HIPAA provides for an additional 30-day extension. However, six of the 81 hospitals that provided turn-around times to medical records requests were noncompliant with federal processing time requirements. 

Congress passed HIPAA primarily to modernize the flow of healthcare information. An important part of the Act was to make it easier for patients to receive their medical records and clinical data from hospitals, medical offices, clinical laboratories, etc. The Yale study, however, indicates that obtaining medical records can still be a cumbersome and perplexing process for patients.

The United States Government has spent upwards of $30 billion since 2010 in incentives to encourage hospitals and physicians to implement and use electronic health record (EHR) systems. One goal of issuing these incentives was to make it easy and inexpensive to move patient data between providers to support improved clinical care, as reported by the Commonwealth Fund.

This research demonstrates that the internal policies of some hospitals and health systems are contrary to federal and state laws because patients are often struggling to gain access to their own medical records. The results of the Yale study present an opportunity for clinical laboratories and pathology groups to adopt and offer patient-friendly access to obtain lab test data.

—JP Schlingman

Related Information:

Hospitals Are Roadblocks to Patient EHR Data Requests, Despite HIPAA

Assessment of US Hospital Compliance with Regulations for Patients’ Requests for Medical Records

American Hospitals Make It Too Hard for Patients to Access Medical Records

The Federal Government Has Put Billions into Promoting Electronic Health Record Use: How Is It Going?

Sorting through EHR Interoperability: A Modern Day Tower of Babel That Corrects Problems for Clinical Laboratories, Other Providers

Microbiologists Take Note! UPenn Study Using Next-Generation Sequencing Finds Stethoscopes Harbor Vast Amounts of Bacteria, Including Staphylococcus Aureus, Which Causes Deadly Hospital-Acquired Infections

Researchers also found Staph and other bacteria on stethoscopes after they had been cleaned, leading to scrutiny of cleaning agents and methods

Microbiologists, anatomic pathologists, and clinical laboratory leaders should be intrigued by a university study which found stethoscopes worn by caregivers contained vast amounts of bacteria, including Staphylococcus aureus (Staph), a major cause of hospital-acquired infections (HAIs).

Using next-generation DNA sequencing, University of Pennsylvania Perelman School of Medicine researchers found the deadly bacteria on stethoscopes stored and used in, of all places, an intensive care unit (ICU), where patients are particularly vulnerable to infection.

Even more compelling was the discovery of DNA from the Staph bacteria on the stethoscopes even after they were cleaned. Though the tests could not differentiate between live and dead bacteria, the researchers found other non-Staph bacteria as well, including Pseudomonas and Acinetobacter.

Similar conditions could no doubt be found in most healthcare settings in America, highlighting the critical importance for rigorous cleaning procedures and protocols.

The researchers published their paper in Infection Control and Hospital Epidemiology, the journal of the Society for Healthcare Epidemiology of America (SHEA).

Deadly Bacteria Becoming Harder to Kill

HAIs are becoming increasingly difficult to prevent partly because Staph bacteria, such as Methicillin-resistant Staphylococcus aureus (MRSA), are becoming increasingly resistant to antibiotics, according to the Centers for Disease Control and Prevention (CDC).

“The study underscores the importance of adhering to rigorous infection control procedures, including fully adhering to CDC-recommended decontamination procedures between patients, or using single-patient use stethoscopes kept in each patient’s room,” said Ronald Collman, MD (above), the study’s senior author and Professor of Medicine, Pulmonary, Allergy, and Critical Care at UPenn’s Perelman School of Medicine, in a news release. (Photo copyright: Penn Medicine.)

The researchers acknowledged that previous culture-based bacterial studies looked at stethoscopes, but noted the results fell short of the view next-generation sequencing technology can offer for identifying bacteria, as well as determining the effectiveness of cleaning chemicals and regiments.

“Culture-based studies, which focus on individual organisms, have implicated stethoscopes as potential vectors of nosocomial bacterial transmission [HAI]. However, the full bacterial communities that contaminate in-use stethoscopes have not been investigated,” they wrote in Infection Control and Hospital Epidemiology.

Study Employs RNA Deep-Sequencing

The UPenn researchers used bacterial 16 ribosomal RNA (16S rRNA gene) deep-sequencing to study the bacteria, Becker’s Healthcare explained.

The stethoscopes analyzed were in-use as follows:

• 20 worn by physicians, nurses, and respiratory therapists;

• 20 single patient-use disposable stethoscopes available in ICU patient rooms; and,

• 10 unused single-use disposable stethoscopes to serve as a control.

All stethoscopes worn and/or used in the ICU were found to be contaminated with abundant amounts of Staphylococcus DNA. “Definitive” amounts of Staph was found by researchers on 24 of 40 tested devices, noted MedPage Today.

“Genera relevant to healthcare-associated infections (HAIs) were common on practitioner stethoscopes, among which Staphylococcus was ubiquitous and had the highest relative abundance (6.8% to 14% of containment bacterial sequences),” the researchers noted in their paper.

Cleaning Methods Also Examined

The researchers also studied the hospital’s cleaning agents and procedures:

• 10 practitioner stethoscopes were examined before and after a standard 60-second cleaning procedure using hydrogen peroxide wipes;

• 20 additional stethoscopes were assessed before and after cleaning by practitioners using alcohol wipes, hydrogen peroxide wipes, or bleach wipes.

All methods reduced bacteria. But not to the levels of a new stethoscope, the study showed.

“Stethoscopes used in an ICU carry bacterial DNA reflecting complex microbial communities that include nosocomially important taxa. Commonly used cleaning practices reduce contamination but are only partially successful at modifying or eliminating these communities,” the researchers concluded in their paper.

Prior Studies to Find and Track Dangerous Bacteria

Studies tracking bacteria where people live, work, and travel are not new. For years, medical technologists and microbiologists have roamed the halls of hospitals and other clinical settings to swab and culture different surfaces and even articles of clothing. These efforts are often associated with programs to reduce nosocomial infections (HAIs).

One such study revealed that about 47% of neckties worn by clinicians carried HAIs, according to a New York Hospital Medical Center (now New York-Presbyterian Queens) study. Dark Daily reported on this finding 10 years ago. (See, “Antibiotic Neckties Are Latest Healthcare Fashion Trend,” May 25, 2007.)

And, on a larger scale, in 2013, researchers at Weill Cornell Medical College in New York City (NYC) used next-generation gene sequencing to track pathogens in the NYC subway system. The project, called PathoMap, involved collecting 1,404 surface samples from 468 NYC subway stations to develop a system for spotting and tracking potential microbial threat due to bioterrorism or emergent disease. (See, “Microbiologists at Weill Cornell Use Next-Generation Gene Sequencing to Map the Microbiome of New York City Subways,” December 13, 2013.)

This new study by UPenn Perelman School of Medicine researchers—published in a peer-reviewed medical journal—will hopefully serve as a contemporary reminder to doctors and other caregivers of how bacteria can be transmitted and the critical importance of cleanliness, not only of hands, but also stethoscopes (and neckties).  

Hospital-based medical laboratory leaders and microbiology professionals also can help by joining with their infection control colleagues to advocate for CDC-recommended disinfection and sterilization guidelines throughout their healthcare networks.

—Donna Marie Pocius

Related Information:

Molecular Analysis of Bacterial Contamination on Stethoscopes in an Intensive Care Unit

Stethoscopes Loaded with Bacteria, Including Staphylococcus

ICU Stethoscopes Teeming with Bacteria

Bacteria Remains After Cleaning Stethoscopes: Four Study Insights

Predictors of Heavy Stethoscope Contamination Following a Personal Examination

Centers for Disease Control and Prevention: Guidelines for Disinfection of Healthcare Equipment

Antibiotic Neckties are Latest Healthcare Fashion TrendMicrobiologists at Weill Cornell Use Next-Generation Gene Sequencing to Map the Microbiome of New York City Subways

FDA Authorizes 23andMe to Report Results of Direct-to-Consumer Pharmacogenetics Test to Customers without a Prescription, Bypassing Doctors and Clinical Laboratories

FDA cautions patients to not use data gained from the DTC test to make healthcare decisions on their own

Clinical laboratories continue to be impacted by the growing direct-to-consumer (DTC) testing market, as more walk-in lab customers order at-home tests. Now, the US Food and Drug Administration (FDA) has authorized a DTC test company to provide results of a pharmacogenetic (PGx) test to customers without needing a doctor’s order. This is the first genetic test of its kind to receive such FDA authorization and is in line with the government’s focus on precision medicine.

23andMe gained the authorization through the FDA’s de novo classification process, which the FDA uses to classify new devices that have no existing classification or comparabledevice on the market. 

“We’ve continued to innovate through the FDA and pioneer safe, effective pathways for consumers to directly access genetic health information,” said Anne Wojcicki, co-founder and CEO of 23andMe, in a news release. “Pharmacogenetic reports are an important category of information for consumers to get access to, and I believe this authorization opens the door for consumers to work with their health providers to better manage their medications.”

However, some experts caution that informing patients directly on how they metabolize medications based on genetic testing could encourage them to bypass physicians and medical laboratories in the decision-making process.

In a safety communication, the FDA alerted patients and healthcare providers that “claims for many genetic tests to predict a patient’s response to specific medications have not been reviewed by the FDA and may not have the scientific or clinical evidence to support this use for most medications. Changing drug treatment based on the results from such a genetic test could lead to inappropriate treatment decisions and potentially serious health consequences for the patient.”

Tim Stenzel, MD, PhD (above), Director, Office of In Vitro Diagnostics and Radiological Health at the FDA, told FierceBiotech, “This test should be used appropriately because it does not determine whether a medication is appropriate for a patient, does not provide medical advice, and does not diagnose any health conditions. Consumers should not use this test to make treatment decisions on their own.” (Photo copyright: LinkedIn.)

PGx Supports Precision Medicine

Pharmacogenetics (PGx) is the study of how genetic differences among individuals cause varied responses to certain drugs. Demand for PGx testing has increased exponentially as it becomes more valuable to consumers. It could provide a path to precision medicine treatment plans based on each patient’s genetic traits. And help determine which drug therapies and dosages may be optimal and which medicines should be avoided.  

“This test is a step forward in making information about genetic variants available directly to consumers and better inform their discussions with their healthcare providers,” Stenzel told FierceBiotech. “We know that consumers are increasingly interested in genetic information to help make decisions about their healthcare.”

The genes and their variants examined in the 23andMe PGx test are:

  • CYP2C19 *2, *3, *17;
  • CYP2C9 *2, *3, *5, *6, rs7089580;
  • CYP3A5 *3;
  • UGT1A1 *6, *28;
  • DPYD *2A, rs67376798;
  • TPMT *2, *3C;
  • SLCO1B1 *5; and,
  • CYP2D6 *2, *3, *4, *5, *6, *7, *8, *9, *10, *11, *15, *17, *20, *29, *35, *40, *41.

Hospitals Bring PGx Testing to Primary Care

Innovative hospital and health networks also are starting to make PGx tests available in primary care settings.

Sanford Imagenetics, part of the Sanford Health system, has produced a $49 laboratory-developed test (LDT) for genetic screening known as the Sanford Chip to help physicians select the most advantageous therapies for their patients. It uses a small amount of blood to identify patients’ risk for certain genetic diseases and determine which medications would be best for them. 

Sanford Health, headquartered in Sioux Falls, SD, is one of the largest health systems in the US with 44 hospitals, 1,400 physicians, and more than 200 senior care locations in 26 states and nine countries.

Geisinger Health, headquartered in Danville, PA, has initiated a pilot project based on PGx testing. The genetic sequencing data from 2,500 patients will be reviewed to determine if they are taking the best medication for their health conditions. Patients in need of changes to their prescriptions will be contacted by Geisinger pharmacists for recommendations.

As consumer demand for PGx testing increases, DTC customers will likely continue seeking new information about their genome. Clinical laboratories could play a role in interpreting that data and assisting pathologists and other healthcare providers determine the best drug therapies for optimal health outcomes.

—JP Schlingman

Related Information:

FDA Clears 23andMe’s DTC Drug Metabolism Test

FDA Clears the First Consumer Genetic Test for How Well Your Medications May Work—with Caveats

23andMe Granted the First and Only FDA Authorization for Direct-to-Consumer Pharmacogenetic Reports

Your Genes Can Show Us How Your Body Reacts to Drugs

Sales of Direct-to-Consumer Clinical Laboratory Genetic Tests Soar, as Members of Congress Debate How Patient Data should be Handled, Secured, and Kept Private

Balance Billing Under Increased Scrutiny at Both State and Federal Levels; Clinical Laboratory Tests Top List of Surprise Bills Received by Patients

Experts blame insurance regulators for not ensuring the adequacy of healthcare networks that include hospital-based physicians, such as pathologists and radiologists

According to a recent study, clinical laboratories, anatomic pathologists, radiologists, and anesthesiologists top the list of providers who bill patients for the difference between what they charge for their services and a hospital’s contracted reimbursement rates.

This so-called “balance-billing” not only causes hardship for patients and consumers already shouldering a larger portion of their healthcare costs, but poses a public relations concern for service providers across the US healthcare industry as well.

Following public outcry from patients who received care at what they believed to be in-network medical facilities, only then to be surprised by bills from their care providers for the remaining balance not covered by their insurance, the practice of balance billing has drawn increased scrutiny from state and federal officials.

Medical Laboratory Charges Top Reason for Surprise Bills

In August 2018, the National Opinion Research Center (NORC) at the University of Chicago interviewed 1,002 respondents age 18 and over about surprise medical bills.

In their report, NORC notes that of those surveyed, 57% (567 individuals) acknowledged receiving a surprise medical bill they thought would be covered by their health insurance.

When asked about the network status of the doctor who provided care during the episode related to the surprise bill, 79% responded that charges were not for doctors being out-of-network for their insurance plan. Medical laboratory-related charges were near the top of reasons patients received surprise bills, with 51% of individuals receiving bills related to “a laboratory test, like a blood test.”

Such surprise medical bills received frequent coverage in 2018. This has led many states to enact or discuss legislation to address the practice and offer cost protections for patients.

The Centers for Medicare and Medicaid Services (CMS) even included a Request for Information related to surprise billing and price transparency in their “Fiscal Year (FY) 2019 Medicare Hospital Inpatient Prospective Payment System (IPPS) and Long Term Acute Care Hospital (LTCH) Prospective Payment System Proposed Rule.”

Thus far, however, little change to existing regulations and contract systems has been enacted to protect patients or help laboratories and other service providers offer alternative payment solutions for patients.

There also are few requirements for insurance providers to verify that plans include sufficient numbers of in-network service providers when offering plans to consumers.

“Many news stories on ‘surprise’ billing blame physicians, because the bill is sent from the doctor’s office or billing company. But the insurance industry is the real culprit, in concert with insurance regulators who have not acted to require network adequacy,” R. Bruce Williams, MD (left), President, College of American Pathologists (CAP), and Geraldine B. McGinty, MD (right), Chair of the American College of Radiology Board of Chancellors, wrote in STAT. (Photos copyrights: College of American Pathologists/Geraldine McGinty.)

States Move to Change Trends While Patients Continue to Experience Bill Shock

States are beginning to address surprise billing concerns ahead of action by insurance regulators and the federal government. In December, the Arizona Department of Insurance issued a news release outlining the agency’s plan to allow for arbitration questions for surprise out-of-network bills.

And, California effectively banned out-of-network billing from groups within in-network facilities in 2017 with Assembly Bill 72. However, the state only finalized reimbursement rates for service providers and patients affected by surprise bills in January of this year according to Capital Public Radio.

Many of these state-level regulations do not account for the complexity of creating rules based on emergency or non-emergency care or the insurance providers in question. For example, Assembly Bill 72 does not apply to “Medicare, Medi-Cal, out-of-state plans, self-insured employer plans, or other products regulated by federal law,” according to a news release from the California Society of Anesthesiologists.

Finding Fair Solutions for Both Patients and Care Providers

Speaking with Kaiser Health News about a report of a man in Texas receiving a $109,000 surprise bill related to treatment after a heart attack, Rep. Lloyd Doggett of Texas said, “This is a nationwide problem, and we need a nationwide solution. We have a system where the patient, the most vulnerable person of all those involved, is caught between the insurer and the healthcare provider … these problems are solvable.”

Modern Healthcarerecently covered how some hospitals are now requiring physicians to go in-network as a provision of their contracts. However, they also note this approach disadvantages physicians and shifts reimbursement negotiation power to insurers. Should hospitals take a similar approach with medical laboratory specialists, it could create similar concerns.

While surprise medical bills create added hardship for patients and pose reputational and reimbursement concerns for clinical laboratories and healthcare providers, creating regulations that establish effective protections while also protecting the financials of service providers continues to prove difficult.

Speaking with Modern Healthcare, Dan Sacco, Vice President for Strategic Affairs and Payer Relations at Boca Raton Regional Hospital, summarized concerns concisely, saying, “We’re trying to protect [consumers], but we’re also trying to be reasonable business partners as well.”

—Jon Stone

Related Information:

Surprise Out-of-Network Bills Are the Fault of Insurance Regulators

Hospitals’ Solution to Surprise Out-of-Network Bills: Make Physicians Go In-Network

Letter from AHA and FAH to Congress

NORC AmeriSpeak Omnibus Survey: Surprise Medical Bills

Arizona Department of Insurance: Arbitration for Surprise Healthcare Bills Will Be Available Soon

New Payment Model Tackles “Surprise Medical Bill” Issue

AB 72 Implementation: What You Need to Know

The $109K Heart Attack Bill Is Down to $332. What about Other Surprise Bills?

Taking Surprise Medical Bills to Court

Surprise Medical Bills Loom for Millions of Americans in 2019

Fiscal Year (FY) 2019 Medicare Hospital Inpatient Prospective Payment System (IPPS) and Long Term Acute Care Hospital (LTCH) Prospective Payment System Proposed Rule, and Request for Information

AB 72: What the New “Out-of-Network” Law Means