The next time you receive a bill from a hospital emergency room in Texas, think twice. If you have insurance, you likely don’t need to pay it.
But you do need to contact the Texas Department of Insurance and request mediation to resolve the issue.
That’s the message from Texas AARP, which helped lobby the Texas Legislature this past session for an upgrade in consumer protections for emergency room “balance billing.” This occurs when an ER physician or service is not in a plan’s network but tries to bill a patient directly after receiving a negotiated payment from the insurer.
The problem is big and growing.
“Thousands of people get these bills every year in Texas,” said Stacey Pogue, senior policy analyst with the Center for Public Policy Priorities in Austin. “And the percent of people who know about mediation to resolve the issue is very small.”
Her 2014 report to the Legislature showed that the state’s top three preferred provider organization insurers — United Healthcare, Humana and Blue Cross Blue Shield of Texas — each reported a high percentage of out-of-network emergency room physician billings after a patient used an in-network hospital. In United’s case, the practice happened 68 percent of the time. For Humana and Blue Cross, it was 42 percent and 41 percent, respectively.
A large number of Texas emergency rooms have no in-network physicians working there, guaranteeing that the patient will be treated by an out-of-network doctor, Pogue said. That happened in more than half the hospitals covered by Humana, 45 percent covered by United and 21 percent covered by Blue Cross.
“This surprised me and when I shared the data with the carriers, it surprised them,” Pogue said.
The problem arises because many hospitals no longer have their own emergency room staff. They are outsourcing the work to third-party practices, said Trey Berndt, associate state director for outreach and advocacy for AARP Texas.
“It’s related to network adequacy,” he said. “A hospital is calling itself a network facility when a lot of the people under their roof are not in-network. It’s very misleading to the consumer and in an emergency situation they are not in a position to shop around.”
In 2009, the Legislature enacted a law allowing PPO emergency room patients facing balance bills of more than $1,000 to use mediation through the Texas Department of Insurance.
The program is little-known but highly effective, Pogue said. Of the nearly 2,000 Texans who used it from 2009 to 2014, almost 90 percent resolved bills in the first step of the process — a telephone call between the insurer and the physician’s office, she said.
The remaining 211 complaints were sent to mediation, which brings the insurer and the physician together — at no cost to the patient — to resolve the issue through a third-party mediator. Just one case went further, to an administrative judge, for resolution.
During the most recent legislative session, the balance-billing law was tightened further through a bill that was sponsored by Sen. Kelly Hancock, R-North Richland Hills, and passed almost unanimously.
Starting in September, the bill amount required to trigger mediation drops to $500. In addition, assistant surgeons — one of the problem areas for balance billing — were added to the list of providers subject to mediation. Other providers under the law include ER physicians, anesthesiologists, pathologists, radiologists and neonatologists.
While these changes are improvements, advocates said they will work in the next session to make all balance-billing cases subject to mediation or to ban the practice outright.
Also, the current law is limited to hospital emergency rooms, not free-standing facilities or outpatient centers. Finally, the mediation program does not apply to self-funded ERISA plans or indemnity plans. Changing those would require a federal law.
Another positive consumer medical law also set to begin in September requires insurers to keep their physician directories up to date to aid policy shoppers in choosing a plan, said Blake Hutson, senior associate with Consumers Union in Austin.
“It’s a real problem for consumers, particularly when you’re trying to buy a healthcare plan,” he said. “We always advise before you buy to check that your doctors and drugs are covered by the plan, but insurers haven’t always kept their directories updated.”
House Bill 1624, sponsored by Rep. John Smithee, R-Amarillo, also requires insurers to shed light on their drug formularies to better inform consumers on out-of-pocket costs, Hutson said.
But as with any law, knowing your rights is the first step. For more information on balance-billing mediation, go to www.tdi.texas.gov/consumer/cpmmediation.html.
Teresa McUsic’s column appears Saturdays. TMcUsic@SavvyConsumer.net