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House HELP Committee on the road to adding to health care costs

In an effort to better manage health care spending pending legislation adds more administrative costs and record keeping requirements. Health insurance companies are typically the targets for creating administrative costs which increase health care charges by providers, but the real culprits are federal and state laws and regulations. Here is a recent example.

The draft “Lower Health Care Costs Act,” would require health care facilities and health care providers to give patients a list of services received upon discharge, and would require all bills to be sent to the patient within 30 business days.  If a patient received a bill more than 30 business days after receiving care, the patient would have no obligation to pay. 

Medicare doesn’t even process claims within 30 days and when there is supplemental coverage files are transmitted every three months for processing. How will the provider know what to bill the patient in 30 days?

Providers and health plans would be required to give patients good-faith estimates of their expected out-of-pocket costs within 48 hours of a request by the patient.

Interesting; I wonder how providers will know where their patient stands in terms of meeting out of pocket provisions of their health plan or how the health plan will know all the services to be provided?

The legislation also prohibits PBMs from keeping rebates, discounts or other payments from pharmacy companies. Okay, PBMs will simply increase their fees to health plans and employer plans. In addition, large employers have had agreements for years under which the plan receives the rebates.

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7 replies »

  1. With respect to timely filing and processing claims.

    Here’s the deal. What other service do you receive where they suggest they can’t provide you an itemized bill within 5 calendar days of discharge? Auto repair, legal services, tax preparation, visit to the grocery store? The inability of the provider to present a bill at release or discharge is custom – nothing more. However, the fact is that when I leave my doctor’s office today, I already have all my scripts sent to the pharmacy, and, I already have a report in my portal regarding the results of the visit. They ask me for payment up front for any copay, or where subject to the deductible, they give me an estimate of my out of pocket spend and ask for payment then.

    Section 305 (in the Senate version) is titled “Timely Bills for Patients”. It requires the patient receive, from the provider, in print or electronically, a list of each service received within 5 calendar days after discharge. Something wrong with that? Aren’t services recorded as delivered, anyway?

    Further, it requires the provider to send all adjudicated bills to the patient as soon as practical, but not later than 45 calendar days after discharge. It confirms that patients need not be required to pay a bill before 30 days after receipt of the bill.

    Those who fail to meet the 45 day standard do not get to collect. Do it 10 times, and the provider is subject to government assessed financial penalties.

    However, and this is very important, the bill also provides that a group health plan or health insurance issuer can contract for a different timeline with respect to processing claims.

    What I would have recommended, had they asked:

    The bill is primarily focused on removing “surprise” costs – including out of network providers that the patient reasonably believed to be in-network, etc. If they had asked me (they never would), I believe they could have achieved a superior result if they mandated the following changes:

    1) Where non-emergency services are provided, in advance of rendering services, require all of the providers involved to offer an itemized treatment plan and an estimate of the charges, and require the insurance company (claims administrator) to provide an estimate of the patient’s out of pocket costs, where the patient would pay that amount at the time services are rendered.

    2) Should the services actually rendered deviate from the estimate (choose your percent, I would use 10% measured by cost), the providers can submit supplemental bills after the fact and receive added reimbursement from the insurer/claims administrator (but not the point of purchase cost sharing that would have been paid by the patient) based on the terms of the insurance policy/health plan. .

    Where services are emergency in nature, all treatment is in-network, so no balance billing. So, if you are an out-of-network provider, and you provide services in an emergency situation (applying the prudent layperson rule), you are limited to in-network charges (negotiated fees, if you like, say 125% of Medicare allowable charges).

    With respect to Rx, the only change I believe we need to see is that drug manufacturers should not be able to charge a different, higher amount based on geographical location or recipient organization/individual unless there is a demonstrated difference in cost to make the Rx available (transportation, security, other costs) – so economies of scale via PBM transactions (purchasing in bulk quantities) would flow to the patients. In effect, we would stop subsidizing the Canadians and the French. The PBM’s would still be financially successful in that they receive fees for processing each and every one of the massive number of Rx transactions.

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  2. I work in healthcare, and there is no excuse in today’s age of supercomputers and cloud computing for every insurer including federal ones to give instant answers back on processing the claim and telling the provider how much is owed.

    When a patient is being discharged, the hospital billing system should be able to submit all the codes and data to the carrier, the carrier should be process the claim and let the provider know all deductibles and amounts due and discounts, and all of this should take 1-3 seconds.

    There is just no excuse for this not happening.

    I think think this law should go further and say that all insurers must offer a web interface claim submission and provide resolution of all claims within 30 seconds, and that any bill after 14 days is not valid.

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    • Should and no excuse. I agree, but the reality is hospitals and doctors offices can’t even communicate with each other for patient care. I know, I’m experiencing that now between three hospitals and several doctors. Getting info, transferring records is a nightmare and as you say, no excuse.

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    • My wife is a nurse. The hospital she works in is, sort of, self-insured. You have to stay in network (her network of hospitals/doctors). But, the “health care network” can’t bill itself correctly. Go figure.

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  3. All I see is this causing prices to rise. I would love to have a good faith estimate in 48 hours, however the system is setup to charge by the band-aid and by the pill. One change in the medical bill coding and a diagnostic test become a procedure and out of pocket deductibles apply. So the questions is do they do a colonoscopy for the examination and do a second one to remove polyps or do they do it all at the same time? Doctors will start giving the high end estimates to cover themselves or schedule two procedures.

    I also don’t expect doctors to know the details of every healthcare insurance plan. I have called Blue Cross and they even have given me two different answers. Until the actual work is done it is not even a best guess.

    It is not like a roof replacement where your estimate includes the material and labor for the roof but they can also include pricing for every piece of damage roof framing structure they find (by the piece). The human body is so different. Dentist can give great estimates because they are working on one accessible part, a tooth. Cancer is a different story.

    I say we start with surprise billing. When you go to an in network hospital you should not get a out of network bill for someone or some service in that hospital. It should not be like being charge to enter a mall than having to deal with each store inside the mall separately, after they have already started treatment.

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