This is a photo of MidState Medical Center in Meriden
A statewide health information exchange is expected to launch next year. Arielle Levin Becker / The CT Mirror
This is a photo of the outside of the emergency department at MidState Medical Center in Meriden
MidState Medical Center in Meriden Arielle Levin Becker / The CT Mirror

The stories can be dramatic, like the case of a New York man hit by an unexpected $117,000 bill from an assistant surgeon who didn’t take his health insurance. That and stories like it, told by The New York Times, drew attention to the phenomenon of “surprise billing.”

It occurs when a patient gets care from a facility within his insurance network but unknowingly receives treatment from a doctor who doesn’t accept his insurance, and ends up with a bill for out-of-network care. The stories helped inspire Connecticut legislation intended to curtail surprise billing.

But just how common is it?

Yale professor Zack Cooper wondered that. So he examined a set of insurance claims that covered more than 2.2 million emergency department visits.

The result shocked him: In 22 percent of emergency room visits, a patient was treated by at least one physician who wasn’t in their insurer’s network. That means that nearly one in four emergency room visits left the patient exposed to potentially costly bills from out-of-network doctors the patient had little or no choice about seeing.

Although he was floored by the result, Cooper said that when he tells people about his research, it’s not uncommon to hear, “Oh yeah, I had that happen.”

Cooper and colleague Fiona Scott Morton described the findings in an article published Wednesday in The New England Journal of Medicine. The data, from a national insurance company, covered emergency department visits for people under 65 between January 2014 and September 2015, which altogether represented more than $7 billion in spending.

There was significant variation in the frequency of out-of-network charges, ranging from 89 percent in McAllen, Texas, to virtually none in Boulder, Colo., and South Bend, Ind. (In Connecticut, the incidence was below the national average.) And Cooper said that variation suggests the problem is fixable.

“There are a lot of problems in health care that can’t be solved, that we struggle with, that are almost intractable,” Cooper said. “Here’s one that causes real harm, that we could solve tomorrow.”

Hospitals generally contract for their emergency care with physician groups, which do their own contracting with insurance companies, Cooper and Scott Morton wrote. As a result, a hospital can participate in an insurer’s network while the doctors who staff its emergency room do not. If those doctors are not in an insurance company’s network, they can charge more to patients, since they did not agree to accept rates negotiated with the insurer. In addition, patients can face larger bills for seeing out-of-network providers because their insurance plans often require them to pay a larger share of the cost than they would if they’d seen an in-network provider.

In the claims included in the study, patients could have faced an average of $622 in higher charges from the out-of-network doctors, Cooper and Scott Morton calculated. For context, they noted that a 2015 Federal Reserve survey found that 46 percent of respondents couldn’t cover an unexpected $400 expense without borrowing or selling assets.

“Most patients select in-network EDs for emergency care,” they wrote. “They should rightly expect to be treated by in-network doctors and shouldn’t face financial ruin as a result of physician bills they cannot reasonably avoid.”

The article drew a rebuke from the American College of Emergency Physicians. The group said the insurance company data was not available for examination and could be flawed. And the group suggested the real problem is inadequate insurance coverage, including high-deductible health plans that leave patients to pay a large share of their bills.

In a statement, Dr. Rebecca Parker, the organization’s president, said that when patients face bills for seeing out-of-network emergency physicians, it’s often because insurance companies “refuse to contract for adequate payment for emergency physician providers.”

“Most emergency physicians prefer to be ‘in-network,’ as long as insurance companies pay fairly,” she said.

Some states, including Connecticut, have passed laws intended to protect patients from surprise bills, but Cooper said state-level action has been inadequate.

Some states have “hold harmless” provisions that shield patients from higher charges from out-of-network providers. But such laws typically require insurance companies to pay the bill, which means the costs are likely to be passed on to consumers in the form of higher premiums. And, Cooper and Scott Morton wrote, they “create perverse incentives for providers to avoid joining networks.”

Cooper had a more favorable view of Connecticut’s version, which was passed as part of a larger health care bill in 2015. It requires that patients who receive emergency services from an out-of-network provider not be charged more than they would pay if they saw an in-network provider. It also specifies what the provider can charge the insurance company. Similar guidelines apply to surprise bill situations involving non-emergency care. They don’t apply if the patient chose to see an out-of-network provider when an in-network provider was available.

But Cooper said a weakness of state-level action is that such laws generally only apply to a fraction of people with private insurance, because health plans offered by most large insurers are typically not subject to state regulation. And even for patients whose plans are subject to state laws, Cooper and Scott Morton wrote, they would still have to know what to do if they received a surprise bill.

They proposed an alternative: Require hospitals to use a “bundled” fee for emergency care that covers both the facility cost and the professional fees of the doctors. In effect, the hospital would do all the billing for emergency care, and use part of those charges to pay the doctors who staff the emergency department.

Arielle Levin Becker covered health care for The Connecticut Mirror. She previously worked for The Hartford Courant, most recently as its health reporter, and has also covered small towns, courts and education in Connecticut and New Jersey. She was a finalist in 2009 for the prestigious Livingston Award for Young Journalists, a recipient of a Knight Science Journalism Fellowship and the third-place winner in 2013 for an in-depth piece on caregivers from the National Association of Health Journalists. She is a 2004 graduate of Yale University.

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