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Sunday, August 12, 2012
Reimbursement dispute may mean ER bills for some patients
Posted: Sunday, July 8, 2012
A reimbursement dispute between the doctors who staff Abington Memorial and Lansdale hospitals’ emergency rooms and the region’s largest health insurer could leave thousands of patients with unexpected medical bills.
As of July 1, Abington Emergency Physicians Associates, which provides emergency room services at the two hospitals, is no longer part of the Independence Blue Cross insurance network. The change only impacts emergency room doctor services; the hospitals remain part of the Independence Blue Cross network.
“We regret this inconvenience and hope that this situation is resolved very quickly,” Abington Health System President and Chief Executive Officer Laurence Merlis said in a letter to Independence Blue Cross subscribers.
Notice posted in Abington Memorial Hospital
This is the first time an emergency physician group in the Philadelphia region has ended its contract with Independence Blue Cross, its spokeswoman Karen Godlewski confirmed.
The situation not only affects patients with routine emergency care needs, but Abington Memorial is one of only two trauma centers in the region (St. Mary Medical Center is the other), where patients facing life-or-death injuries are taken.
About 30 percent of the 105,000 patients each year who use Abington Memorial’s emergency department carry Independence Blue Cross health insurance, spokeswoman Linda Millevoi said. Last month about 2,600 patients with Independence Blue Cross insurance were treated at the Abington Memorial emergency department alone.
At Abington Hospital’s Lansdale campus about 7,760 emergency room patients had insurance through Independence Blue Cross last fiscal year, Millevoi said.
Independence Blue Cross patients, including those with Medicare Advantage plans, can still seek emergency treatment at either hospital’s emergency room, but they will be treated as out-of-network. Health care providers frequently charge higher rates for the same services when they don’t have a negotiated fee rate with an insurer. Insurance companies also generally pay less for out-of-network care.
What that means is that some patients could be subject to higher cost-sharing and balanced billing, where health care providers seek to recoup from patients the charges that an insurer doesn’t pay. Medicare patients cannot be balance billed under federal law.
Under one of the lesser known provisions of the federal health care law, insurers now cannot impose higher cost-sharing and coverage limits in newly issued health plans, and but it doesn’t prevent health providers from balance billing patients.
Abington Emergency Physicians Associates — which is independent of the hospitals — has staffed Abington’s trauma center for more than 21 years and the emergency department at Lansdale for more than three years, Merlis said. The practice’s most recent three year contract with Independence Blue Cross expired June 30.
A confidentiality and non-disclosure agreement between the two parties means neither side is permitted to discuss the nature and details of the negotiations to date.
Dr. Ken Kidwell, chairman of the emergency departments at both hospitals, on Friday confirmed that Independence Blue Cross has stated it would not budge from its final reimbursement offer. It’s unclear how long the stalemate could continue, he added.
Blue Cross spokeswoman Godlewski confirmed Friday negotiations with the practice are stalled, but the insurer is continuing to discuss the situation with Abington Health “since IBC and Abington Health have a shared interest in resolving this matter.”
Abington Health has an exclusive contract with Abington Emergency Physician Associates, which prevents Independence Blue cross from contracting with an alternative participating emergency physicians group, Godlewski said.
Many hospitals in the Independence Blue Cross network have exclusive contracts with emergency department physicians, and most require those doctors participate in its network to ensure consistent participation of all doctors’ billing for emergency department services. That isn’t the case with Abington Memorial and Lansdale, Godlewski said.
Hospital officials don’t believe the contract impasse will affect the merger with Holy Redeemer Health System, which is scheduled to take place in spring 2013, Millevoi said.
Abington Memorial and Lansdale have posted notices in the emergency rooms telling Independence Blue Cross patients that the private emergency room practice no longer accepts their insurance.
Contract disputes between private doctors and insurers over reimbursements are nothing new in the Philadelphia suburbs.
Last year Abington Medical Specialists, a large private cardiology group that included an allergy and internal medicine practice, dropped Aetna — the region’s second largest insurer — from its network, leaving 10,000 patients in medical limbo. About 80 percent of the practice’s heart patients were treated at Abington Memorial. The parties worked out their differences and the practice rejoined the Aetna network earlier this year.
In 2008, St. Mary Medical Center and four other Catholic Health East System hospitals dropped contracts with Cigna over reimbursement rates.
Also in 2008, Gastrointestinal Associates Inc., an 18-doctor practice with a Doylestown office, stopped accepting Independence Blue Cross health plans citing declining reimbursement rates.
Lower Bucks Hospital in Bristol Township terminated its contract with Aetna over disagreements involving reimbursement rates in 2003, but the two reached a six-year agreement in 2007.
So far Kidwell said that he’s heard little patient reaction. He was told one patient declined treatment after learning the ER doctors were not in-network; another patient considered leaving but decided to stay.
A growing number of specialty practices, and in some cases, primary care doctors, have severed ties with some or all insurers over reimbursement disputes, said Thomas Getzen, professor emeritus in risk, insurance and health care management at Temple University’s Fox School of Business.
But Getzen says he is not aware of any other emergency room practices with hospital contracts that have pulled out of an insurance network.
“Seems like one of those stand-offs where both parties and bystanders just all get shot up,” he added.