House Insurance Committee Interim Charge #5:

Transcription

1 The Texas Association of Health Plans House Insurance Committee Interim Charge #5: Evaluate recent efforts by the Legislature and the Texas Department of Insurance to minimize instances of surprise medical billing and to ensure the adequacy of health insurance networks. Identify instances in which surprise billing most often occurs and ways to decrease its frequency through enhanced transparency or other methods. December 6th, 2017 JAMIE DUDENSING, CEO Texas Association of Health Plans 1

2 The Texas Association of Health Plans The Texas Association of Health Plans (TAHP) is the statewide trade association representing private health insurers, health maintenance organizations, and other related health care entities operating in Texas. Health plans: Employer-sponsored coverage, the individual insurance market, and public programs such as Medicare and Medicaid. 28 Health Plan Members, including all 20 Texas Medicaid Health Plans. Dental Medicaid Managed Care Organizations, Pharmacy Benefit Managers, Behavioral Health Organizations, Transportation Management Organizations. TAHP advocates for public and private health care solutions that improve the affordability, accessibility and accountability of health care. 2

3 Why Health Plan Networks Are Important Rising Health Care Costs Health Plan Premiums Directly Track with Health Care Costs Health Plan Networks Drive Competitive Price Negotiations Networks Hold Down Costs Contracted Rates vs. Billed Charges Size of Network (5% to 20% Savings) Networks Promote Quality Networks Protect Consumers from Surprise Billing and Inflated Billed Charges 3

4 Texas Consumer Protections Emergency Services or Provider not Reasonably Available Preferred Level of Benefits : In-network Coinsurance Percentage Applies Legislature has never prescribed the reimbursement amount applicable to care delivered by out of network providers. Transparency and Disclosure Requirements Facility Disclosures re: Potential OON doctors Physician Disclosures OON Estimate of Charge upon request FSER Disclosures Health Plan Disclosures Notices re: OON Providers balance billing; estimate of charge upon request Health Plan Provider Directory Standards Notices re: Availability of Mediation Network Adequacy Requirements Mediation for Applicable Balance Billing Claims ($500 threshold) 4

5 85 th Session: Additional Protections SB 507 Mediation for Balance Billing: Expands mediation to more out-of-network emergency care providers who balance bill, including freestanding ERs and ER facilities; and to all non-network facilitybased providers at network hospitals Expands disclosure requirements for health plan EOBs and provider bills HB 3276 Additional FSER Disclosures: A FSER must post a notice that either lists the health plans for which it is in-network or state that it does not participate in any health plan. Rider 15 (ERS) FSER Out-of-Network Co-Pays Directs that the Group Benefits Program implement measures to reduce participants' use of out-of-network FSERs Requires a $150 copay for all FSER visits except for those FSERs that are not affiliated with a hospital and are OON, which require a $300 copay 5

6 Mediation is working for consumers who have been able to use it Thousands of surprise bills have been settled between the health plan and provider, most at the earliest stage of the mediation process Since 2015, Texas consumers have challenged $12.6 million in surprise medical bills, saving $10.8 million 6

7 Out-of-Network Mediation Requests SUMMARY as of October 23, 2017 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 FY2016 FY 2017 FY 2018 YTD Total Number Received ,504 2, Mediation Billed Amount* $242, $4,228, $7,166, $969, Mediation Paid Amount** $49, $713, $1,068, $4, Total Settled via Teleconference ,396 1, Requests pending outcome of Teleconference*** Total Referred to SOAH Number Received - $1,000 and over 1,150 1, Number Received - $500-$999**** Number Received - $499 amount or below Number Received - Did not qualify***** Total Number Received 1,504 2, *The amount entered on the Mediation Request form submitted to TDI. **The amount paid by the carrier to the provider as a result of the informal settlement telephone conference. ***Mediation requests are in a pending status while TDI awaits confirmation the teleconference was completed. ****The mediation request threshold changed to $500 on 9/1/2015. *****These mediation requests did not qualify because 1) they involved a self-funded or other type of health plan that is not eligible for this program or 2) the requester did not provide sufficient information. 7 Source: Texas Department of Insurance, TAHP Conference, Oct 2017

8 Limitations and Ongoing Concerns Mediation is not available for all consumers or for all emergency services Mediation provides valuable patient protections but does not address the underlying economics causing most surprise balance billing - emergency care providers can often increase reimbursement by remaining out of network TDI Usual and Customary Charge payment mandate encourages excessive billed charges and emergency care providers to stay out of health plan networks TDI rule mandates high out-of-network rates, which directly increases costs paid by consumers as coinsurance and deductible amounts Consumers are still confused by FSERs FSERs have started charging hospital-based observation fees in addition to facility fees Exorbitant out-of-network bills Concerns about the use of facility fees and observation fees 8

9 Emergency Care Problem Surprise out-of-network balance billing and excessive charges are predominately an emergency care problem in Texas ER physicians and Freestanding ERs (FSERs) In Texas, almost half of emergency room physician claims were outside the networks of the state's three largest insurers - compared with less than 10% in virtually every other specialty, with many like Ob/Gyn as low as 3% There are more than 300 hospitals in Texas where the hospital itself is innetwork, but there is not a single in-network ER doc available Patients are showing up at the right hospital, but are stuck seeing out-ofnetwork ER providers once they are admitted - An overwhelming 89% of hospital ER claims are in-network, but almost 50% of Texas ER physician claims are out-of-network Most out-of-network emergency facility claims in Texas (69%) occur at FSERs 9

10 Emergency Services Are The Largest Problem Source: TAHP Out-of-Network Claims Survey and Analysis of Three Large Texas Health Plans: 2015 Claims; May

11 Why Emergency Care? Evidence suggest that this trend with emergency care costs may not be an accident ER physicians don t need to be in health plan networks to drive volume already a steady supply of patients Health policy experts say this creates a perverse incentive to remain out of network and bill higher rates deliberate strategy (Yale study) The result is bills that are 2-3 times higher than what is accepted in the market and a higher rates of surprise billing Medicaid Managed Care 11

12 EaVch I]Z IZmVh 6hhdX^Vi^dc d[ =ZVai] EaVch Why Emergency Care? A recent Yale study looked at the impact of hospitals contracting with EmCare, a large physician-staffing company for emergency rooms. Findings include: The rate of out-of-network emergency physician billing skyrocketed - increased over 70% in the first year and an additional 25% the second year when the firm took over a hospital's ED management ER patients were 43% more likely to be billed under the highest acuity and the highest paying procedure codes, compared to hospitals where ED management was outsourced to another company The study's findings indicate "a deliberate strategy to increase revenue since out-of-network payment rates are significantly higher than in-network rates A Dallas Morning News analysis shows 609 locations nationwide for EmCare. Nearly a quarter 142 of them are in Texas, more than in any other state Medicaid Managed Care 12

13 The Problem With Billed Charges or Prices TDI has mandated Usual and Customary Charges, which forces health plans and consumers to pay inflated rates 100% of the time for out-of-network emergency care, even when there is an adequate network (no statutory payment mandate) U&C mandate has driven ER providers out-of-network, has funded the proliferation of FSERs, and driven up emergency care costs in Texas U&C mandate is excessively more expensive than the federal mandate in the Affordable Care Act - Texas health plans premiums for emergency are are now 67% higher than the rest of the nation Billed charges are self-determined by providers Billed charges or prices in Texas are more than 2 to 3 times higher than what is generally paid and accepted in the market and often more than 5 to 6 times higher than what Medicare pays Providers do not expect to collect full billed charges from health plans, and it is rare for anyone to pay the full charges billed There is a lack of transparency regarding billed charge amounts 13

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15 Recommendations TAHP believes in a balanced approach that accomplishes three goals: Protect patients from surprise out-of-network balance bills Provide for fair and reasonable payment to out-of-network providers Provide for a dispute process when providers feel they have not been accurately or adequately paid Streamline emergency care protections, so they are uniform across all product types Set reasonable out-of-network payment standards for emergency care that do not create an incentive for providers to stay out of network NAIC model recommendation rather than U&C Charge mandate Increase transparency of health care prices (billed charges) and network status 15

16 Recommendations Study facility and observation fees and which providers should appropriately be able to charge them Consider giving the attorney general authority to bring action against providers who charge consumers unconscionable prices for emergency care Prohibit misleading FSER advertising, including use of a health plan s logo if it is not in the network Amend assignment of benefits law to provide that acceptance of an enrollee s assignment of health plan benefits by an non-network provider is acceptance of that benefit as payment in full Consider allowing hospitals to employ ER physicians so that they are in the same health plan networks 16