Sunday, December 28, 2003


Some Doctors Letting Patients Skip Co-Payments from The New York Times

For years, health plans have sought to control medical costs by negotiating fees with a group of preferred doctors and requiring patients to pay extra for going outside the network. But some doctors and clinics - eager to help hard-pressed patients or calculating that it can benefit their business - have begun to foil the cost-control efforts by waiving those extra charges.

The move by these providers to dispense with collecting what are known as coinsurance payments comes as employers and insurers try to discourage overuse of health care by making patients pay more costs from their own pockets. But those efforts - and the squeeze on doctors as health plans shrink payments for in-network care - are generating resistance, experts say.

How this works out financially from the physician's standpoint is that it collects the "out-of-network" fees that insurance companies can provide, while the patient assumes no out-of-pocket costs.

Doctors are waiving coinsurance payments for several reasons, analysts say: to recruit patients who would otherwise go to doctors on a health plan's preferred list; to help people struggling with the cost of care, and to reduce their own costs for processing insurance paperwork and dunning patients who are slow to pay.

These doctors can afford to pass up the payments because the out-of-network fees they collect from insurers often are higher than those they would collect as members of a health plan's network.

Notice that this benefit does not extend to physicians within that health plan. And those who go "out-of-network" are dependent on the generosity of their physicians not to stick them with a bill...

But patients who choose an out-of-network plan run the risk of paying more than if they selected one of their health plan's preferred providers, said Randy Kammer, a vice president of Florida Blue Cross and Blue Shield. "There is no obligation for an out-of-network physician not to balance bill,'' she said, using the term for collecting charges in excess of those approved by the health plan.

And the government does not look too kindly on the practice...

Regularly waiving co-insurance payments or co-pays _ the $10 or $20 payments many plans impose for office visits - is against the rules in the government Medicare and Medicaid programs. A few states - Colorado, Georgia, Nevada, South Dakota and Texas - also prohibit the practice for patients covered by commercial insurance, according to Dennis M. Barry, a Washington lawyer who studies health care reimbursement issues.

Colorado and Georgia also forbid advertising the waivers to attract business.....

As I have posted before on 10/3 and 12/17 this is due to the regulation that Medicare patients must be charged the "lowest fees" by a physician.

While this seems to be a good deal for the patient, I have some problems with this:
Since "out-of-network" reimbursement is higher, if more take advantage of it the costs will increase to the managed care plan and they will be passed on to the patients/employers as either a) higher premiums or b)higher copays (which will add to the numbers seeking free "out-of-network" benefits). Managed care plans may then tighten restrictions on reimbursement to "out-of-network" providers, or bring them more in line with their "in-network" benefits.

It hurts the physicians within a plan that have to follow the rules and regulations. This may spur physicians to leave the plan and a vicious cycle is begun with eventually with the plan either being bereft of providers, bankrupt or both.

The physician can assume risk as well, as "out of network" benefits may be paid directly to the patient and not the provider. So you could perform an operation or provide care to a patient and they use their insurance check as "found money" and fly to Vegas while you cant put their gallbladder back in. (This happened at the Acme Surgical Corp). Temptation may arise to engage in "fee-splitting" with the patient.

(I may be wrong, but I think that one benefit of accepting Medicare "assignment" is that the physician is paid rather than the patient, lower reimbursement nonwithstanding. Please correct me if this is an incorrect assumption).
I am now being summoned to help take the tree out. Got to go.

Weblog Commenting and Trackback by HaloScan.com

This page is powered by Blogger. Isn't yours?