Managed Care
MSNJ believes in the sanctity and the importance of the physician-patient relationship. When physicians have time to spend with their patients and exercise their independent clinical judgment, patients’ health is better. Unfortunately, decreasing reimbursement rates by insurers coupled with red-tape to obtain authorizations and to receive fair reimbursement take physicians away from the practice of medicine. The more time that physicians have to spend on administrative work, the less they have for patient care.
Increasingly healthcare dollars go to the administration of insurance: justifying medical necessity, chasing authorizations, and processing claims. The administrative work is costly and takes dollars away from patient care. In addition, healthcare insurer CEOs are collecting record-breaking salaries and compensation packages to reward them for keeping profits of their employers high. Keeping profits high means fewer dollars for patient care. On average, nearly 20%of the nation’s healthcare dollars go to administration, rather than to treatment and payment of physicians for their services. MSNJ believes that more healthcare dollars should go to patient treatment and physician payment for that treatment.
Over the past few years, MSNJ has sought legislation to ensure full disclosure, transparency, and consistency in healthcare insurance claims processing. We believe this will make claims processing more fair and predictable for both patients and physicians. MSNJ believes that it is equally important for patients to join this fight for full disclosure, transparency, and consistency in healthcare insurance claims processing.
MSNJ’s fight for full disclosure of physicians’ fee schedules has been only partially successful. Physicians often do not have their insurers’ most recent fee schedules. Despite our efforts, the Legislature has only required limited fee disclosure. Imagine operating a professional business and not knowing what you will be paid for services! Clearly, the insurers have the upper-hand.
MSNJ believes that patients are in a similar situation. While the percentage of reimbursement for out-of-network benefits is clearly stated in the patient’s plan, the percentage is not meaningful since it is based on the insurer’s opinion of “usual and customary” (UCR) fees and not what the physician may charge, in good-faith, based on prevailing fees in the area. Patients are surprised to discover that their 70% out-of-network reimbursement rate is actually worth far less than 70% because the insurer only reimburses at 70% of what it believes should be UCR. Again, the insurer has the upper hand.
This puts both the patient and the physician in an untenable position. The patient is disappointed because he/she is reimbursed less than what was expected. If the physician filed the out-of-network claim on behalf of the patient, then the physician is looking at a short-fall or is put in the unenviable position of balance billing a patient who already feels cheated and may have received correspondence from the insurer erroneously stating that no money is due to the physician. MSNJ believes that the patient’s understandable irritation should be directed at the insurer, not the physician.
There are numerous examples of how the administration of healthcare benefits pit physician and patient against each other. This does not facilitate quality healthcare. For example, MSNJ believes that insurers’ policies concerning assignment of payment rights to out-of-network physicians is simply a ploy to force physicians into networks to receive payment. This misdirection of payment and heavy-handed business practice is at the inconvenience of the patient.
Often patients who have out-of-network benefits assign their right to payment to the physician—the person who has actually provided the service. The physician may file the claim on behalf of the patient. Instead of honoring the patient’s assignment and paying the physician directly, the insurer purposefully ignores the assignment and sends the payment directly to the patient. The patient may have many pending claims with a variety of out-of network physicians and facilities. If the patient does not understand that the physician has not been paid, the patient may cash the check without paying the physician. This puts the physician in the uncomfortable position of collecting the already earned fee from a patient who may have spent the money.
It serves neither the patient nor the physician for insurers to ignore a valid assignment of benefits. Even if the patient understands that the money is for the physician, the patient is inconvenienced by the insurer’s misdirection of payment; the patient must cash the check and write another check for the physician. This can be mind-boggling if the insurer makes a lump-sum payment to the patient for a number of services provided by a number of out-of-network physicians. This is an administrative burden on the patient and the physicians for no good reason.
Coordination-of-benefits and pre-existing condition rules are complicated and put a drag on the prompt payment of claims to patients and physicians. Patients often give-up their reimbursement rights because they are hopelessly confused. Physicians often have trouble collecting their fees because the service took place so long ago that the patient may no longer be under the physician’s care when the insurers determine that there is no coverage. In this situation, both the physician and payment lose. The physician is not paid for services already rendered; the patient does not get reimbursement that may be due under insurance policies for which a premium (or dual premiums in the case of coordination-of-benefits) has been paid. The insurer wins: premiums are collected; services are rendered; but no payment is made.
Medical necessity review is a process through which insurers determine if treatment will be covered. Patients should appeal denials based on medical necessity review.
Join physicians in asking: Am I getting the benefit of my bargain? Are my healthcare insurance dollars going to treatment and payment to the physicians who provide that treatment?
Patient/consumers who pay for healthcare coverage expect for their out-of-network percentage reimbursement rate to be meaningful. Patient/consumers assume that their in-network rate of reimbursement to physicians is adequate and that the physicians will be paid.
As a consumer, are you receiving full disclosure of your medical benefits? Patients deserve to know:
- exactly what their plans will cover;
- why reimbursement is denied or delayed;
- their true reimbursement rate for out-of-network benefits;
- all the rules that will cause reimbursement to be denied or delayed.
MSNJ urges patients to be good consumers.
- Learn about your policies.
- Keep physicians and insurers up-to-date on all health insurance policies so that coordination-of-benefits decisions can be made expeditiously.
- Require insurers to explain their decisions in a way that is easily understood.
- Appeal decisions that deny payment of claims.
- Engage your employers about their health plans if you believe that you are not getting the benefit of your (or your employer’s) bargain.
- Urge your legislators to make insurers: fully disclose their policies and procedures in a meaningful way; operate transparently and efficiently; direct healthcare dollars to medical treatment; and implement their rules consistently.
MSNJ believes that patients who are educated about their health insurance are better partners in the quest for quality healthcare.
MSNJ Positions on Key Public Policy Issues