Doctors versus Patients
Dr. David Edward Marcinko; MBA, CMP™
Recently, it was reported to the public that millions of patients are paying medical bills they don’t actually owe after being confused about the practices of “balanced billing,” according to a recent business week report Business Week report.
According to the Dictionary of Health Insurance and Managed Care – and others, http://www.HealthDictionarySeries.org – balance billing [BB] may be defined as:
“The practice of a physician, medical clinic, hospital, ASC or medical provider billing a patient for all charges not paid for by an insurance company or healthcare plan. Balance billing is generally prohibited by managed care plans”.
The story in Business Week, on page 40 by Chad Terhune in the September 8, 2008 issue, goes on to discuss how it’s illegal for doctors, hospitals or labs to bill patients for the difference if they deem the insurance payment too low, but that it happens routinely to the tune of $1 billion each year.
And, healthcare journalist Sarah Arnquist similarly noted the practice with more patient BB horror stories in The Health Care Blog [THCB], a policy and political e-periodical not unlike this Executive Post in format; but not content.
Not a New Problem
However, long before the threatening horror-stories first ran about doctors aggressively pursing collections, maybe even as much as a two decades ago, our network of physicians, attorneys, insurance and risk management experts have been writing about this situation in both peer-reviewed and non-peer-reviewed print and traditional publications.
So, the conundrum is not really a new one. In fact, Medicare first prohibited BB, in 1991. But, its ferocity; pitting patient against doctor, might indeed be an emerging issue. And, it is deeply distasteful on many levels.
Managed Care Contracts
Over the years, managed care has replaced usual, customary and reasonable [UCR] fee-for-service [FFS] medicine with a contracted fee-schedule. Essentially under managed care, an MD can “charge” just about anything s/he might want, but the managed care organization (MSO) will only reimburse up to its maximum contractual allowance as determined by a previously set fee schedule; known as a managed care legal-contract.
In other words, medical providers have pre-accepted a fee schedule and have agreed and been contracted to accept “payment-in-full” for services rendered. And, the greater the difference between the MD charge and the allowable reimbursement, the more the MD will eventually write off as artificially inflated accounts receivables [ARs].
Therefore, there is no “balance-bill” to pay [sans fine print specials, out-of-network provider and venue clauses, etc].
Yet, the balance billing mindset continuers by some, especially older, doctors and patients! Why mature docs and patients? It’s because the current and next-generation of doctors, and patients, never practiced or worked in a FS environment, and know little of it?
Now, this might occur benignly; but more often than not today – and in my experience as a multiple-hat wearing medical provider, insurance agent, physician-executive and health economist – it occurs maliciously and greedily; pitting the doctor against patient.
Of course, a common physician defense ploy is the cry: “I didn’t know it was wrong” – or – “my staff was doing the balance-billing; not me.”
Staff Education and Training
So, the doctor’s medical staff is an extension of the physician. And, the physician can become vicariously liable for staff transgressions.
Furthermore, several federal regulations, including HIPAA, the False Claims Act, and OSHA have specific staff training requirements. Failure to provide the required training not only subjects the physician to the risk of employee transgression, but also to the risk of administrative discipline for failure to conduct proper training of staff.
Now, since most patients receive health insurance their employers, it seems odd that some remain so naive about this conundrum; ethics aside. I mean, managed care has been around for almost 20 years now, and its risks and benefits are well known. Contract-medicine did not begin yesterday.
And so, where have such gullible patients been living? In a hole void of newspapers, magazines, TVs and the internet? What about their neighbors, gossip, HR advisors or benefits departments at work? I know of Corporate America, and have participated in several educational programs where employees are informed of their duties and responsibilities in this managed care contracted world.
And so, at the risk of sounding harsh, I often wonder where have these souls been?
In other worlds; naiveté has a price and if you don’t look out for yourself; who will ultimately look out for you? No one! So, get a clue, already! It’s 2008; not 1988.
The Offensive Plan
As a patient, if this occurs to you, as it did to me when I once visited an out of state optometrist who tried to BB me while on vacation, you might consider the following pre-emptive strike. Forewarned is forearmed and it is far better to play offense, than defense, with these aggressive and greedy docs:
Read and understand your managed care plan contract. Know your duties and responsibilities. Follow the rules.
Privately inform your medial provider that you are aware of the “contract-medicine” concept.
Confidently tell the provider to put the BB invoice in writing, under his personal signature.
Whisper to him/her you will fax it to your employer, third-party payer, attorney, IRS, OIG, DOJ and/or insurance commissioner for a collegial second-opinion check.
Finally, once the problem has been resolved, politely inform the provider that true BB is illegal; and suggest that if your health plan’s compensation is too low, he/she should not re-enlist on the plan.
This was all I had to do, as the flustered provider apologized to me, citing personal and staff ignorance. Of course, I then told him of my credentials and my doubt about his “excuse”; but was willing to give him “benefit-of-doubt” this time. No harm-no foul, I reckoned.
By personality – maternal side – I tend to employ the passive-aggressive posture of conflict resolution. So, always be knowledgeable but respectful, polite and most of all ‘umble; just like David Copperfield’s fictional character, Uriah Heep.
And, although there will always be miscreant doctors who try to game-the-system, according to David McKalip MD, Chair, Council on Medical Economics [CME] for the Florida Medical Association [FMA], “A free market with price transparency, quality accountability and private contacting between patient and doctor, is the answer” to the unfortunate balance-billing conundrum.
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Speaker: If you need a moderator or speaker for an upcoming event, Dr. David E. Marcinko; MBA – Publisher-in-Chief of the Medical Executive-Post – is available for seminar or speaking engagements. Contact: MarcinkoAdvisors@msn.com
OUR OTHER PRINT BOOKS AND RELATED INFORMATION SOURCES:
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- HOSPITALS: http://www.crcpress.com/product/isbn/9781466558731
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- ADVISORS: www.CertifiedMedicalPlanner.org
- FINANCE: Financial Planning for Physicians and Advisors
- INSURANCE: Risk Management and Insurance Strategies for Physicians and Advisors
- Dictionary of Health Economics and Finance
- Dictionary of Health Information Technology and Security
- Dictionary of Health Insurance and Managed Care