Survey: Insurance shortchanging doctors, patients

• Emergency room doctors say insurance plans offer inadequate coverage for emergency patients.
• Doctors do not favor ending 'balance billing' unless there are guarantees insurers will pay fair rates.
• Arizona hospital groups recognize patients can be caught in provider-insurer billing disputes.

Four out of five emergency-room doctors who responded to an American College of Emergency Physicians survey believe that privately insured patients have skipped needed medical care because of concerns about out-of-pocket costs.

The survey of 1,924 emergency-room doctors also suggests that an overwhelming number of doctors believe that consumers either don't understand or have been misled by affordable health plans that offer little coverage.

It also revealed that most doctors don't favor curbing the practice of charging consumers for a bill's balance after collecting an insurer's payment. And doctors believe states that enact laws to curb such billing without ensuring fair insurance payments for emergency care would endanger patients, according to the survey.

"We see all comers," said Dr. Jay Kaplan, president of the American College of Emergency Physicians. "We don't do what I call 'wallet biopsies.' We take care of everyone."

Surprise medical bills

Consumers have been stung with emergency medical bills from out-of-network doctors who practice at hospitals that are part of their insurer's networks. A Consumer Reports survey of 2,202 privately insured adults last year found that nearly one-third of adults had grappled with a surprise medical bill over the previous two years. Most consumers contended the billing dispute was not resolved to their satisfaction.

Several states have passed legislation to address surprise medical bills that consumers receive from out-of-network doctors or other medical providers.

But Kaplan said some surprise medical bills stem from insurers' refusal to pay adequate rates, or from health plans that shift costs to consumers with deductibles of $1,000 or more, copayments or coinsurance that requires patients to pay a percentage of their medical bills.

Nearly two-thirds of doctors said they believe most insurance plans offered patients less-than-adequate coverage for emergency medical care.

"What the insurance industry points to as a surprise bill is not due to a physician's charge," Kaplan said. "It is due to the fact the insurance (company) is paying less than it used to."

Half of doctors not fans of mergers

Emergency-room doctors are worried that mergers may give insurance companies more clout. The survey said 49 percent of doctors believe that such mergers had a negative impact on what insurance companies were willing to pay as in-network rates. However, nearly as many doctors, 46 percent, said they did not know how consolidation affected their hospital or medical practice.

Dr. Donald Lauer, president of the Arizona College of Emergency Physicians, said he is part of a small practice that provides emergency medical service at St. Joseph's Hospital and Medical Center in Phoenix and at a Pima County hospital.

Lauer said health insurers seem to be taking a harder stance during contract negotiations.

"In the past, they have been reasonable," Lauer said. "Recently, what we've seen, they don't want to even negotiate."

The survey shows that most doctors don't want to lose their ability to bill consumers directly for the difference when insurers pay less than the full amount for medical charges.

When asked the fairest solution to end the practice of charging patients for balances that insurers refused to cover, 36 percent of doctors said insurers should pay adequate rates established based on a third-party database. Only only 1 percent favored ending "balance billing" outright, while 16 percent favored ending balance billing if insurers paid database rates.

Customers caught in the middle

The survey showed that doctors did not like the idea of hospitals mandating that all doctors and other providers accept the same insurance plans.

Only 1 percent of doctors agreed that a hospital should make sure doctors and other medical practitioners were in-network providers.

Health-insurance industry officials say they favor tighter controls on out-of-network doctors providing care at in-network hospitals.

"If a hospital is in a contract with an insurer, all your providers should be (in-network) as well," said Clare Krusing, press secretary for America's Health Insurance Plans, an industry group. 'We recognize balance billing is a problem as well, because the patient is often stuck in the middle. There is a lack of transparency on the part of providers in terms of their network status and the prices they are charging."

Although several states have tackled the issue of balanced billing, there has been no such proposal in Arizona.

Still, hospitals and doctors recognize that it's a "big topic of conversation," said Greg Vigdor, CEO of the Arizona Hospital and Healthcare Association.

Vigdor said the hospital association favors a "hold harmless" provision modeled after legislation in Colorado. Under such a plan, the goal would to make sure consumers aren't caught in the middle of a payment dispute between a provider and an insurer.

"There's a lot of concern for consumers who are caught in  these situations," Vigdor said.