NEW YORK—Thousands of New Yorkers every year receive costly, surprise bills for medical care—from doctors not covered by their health insurance plans. The cost can be so burdensome so as to force some into bankruptcy.
New landmark legislation proposed by the state budget will protect consumers from liability for out-of-network bills, shifting the responsibility onto the insurance companies and doctors with the help of state mediators.
The protection is being lauded as the most advanced of any state for an issue that is increasing a concern under the new, smaller network plans being offered under the Affordable Care Act.
Most people do everything they can to ensure their doctor is in-network, but may still receive a bill they did not expect, as many providers are not currently required to disclose whether they are in-network or not.
The problem can occur when patients receive emergency care, or when a doctor other than the primary physician—an anesthesiologist or radiologist—becomes involved in a procedure without the patient’s knowledge.
In one case a patient received an $83,000 bill from the non-network plastic surgeon for reattaching his finger, which was severed in a table saw accident.
About 3,000 New Yorkers report unexpected bills each year, according to the Department of Financial Services (DFS), which oversees insurance in New York state. It is the No. 1 patient complaint.
Consumer Protections
New York’s bill is the most advanced of any state, and is the most comprehensive, according to Chuck Bell, program director at Consumers Union, a consumer advocate group.
He said outside New York only Illinois requires arbitration for emergency room charges when insurers and providers don’t agree, and Texas offers voluntary mediation when out-of-network charges are billed.
If a patient were to receive a surprise bill for any reason, the new legislation would treat out-of-network doctors the same as if they were in-network. Consumers would then only be responsible for their copays, a much smaller bill, as if the doctors were covered by their health insurance plans.
The state would also require more disclosure from hospitals to help patients identify whether providers are in-network, and hold insurers responsible for expanding their networks so consumers don’t need to opt for out-of-network providers.
According to Bell, some networks in New York are already small, but adequate. Health insurance covering out-of-network doctors and specialists is generally more costly, and a smaller network is more affordable, he said.
“[T]he bottom line is that, if consumers are going to be in networks, they have to know how they work and how to access the care they need, without navigating through an obstacle course,” Bell said.
Interim Advice
The benefits would not go into effect until maybe 2016, Bell said, and patients often do not know what to do now when they receive a surprise bill.
The 3,000 complaints DFS received last year are “just the tip of the iceberg,” Bell said.
New Yorker Joclyn Krevat, 36, was rushed to the emergency room four years ago and discovered she had a rare autoimmune disease. Krevat needed a heart transplant, and was in intensive care for seven weeks at a hospital covered by her husband’s health insurance. It turned out the doctors handling her surgery were not part of the hospital, and she was billed for $70,000, with no one to hold accountable.
In another case, a patient confirmed with his insurance company the hospital and surgeon he chose were in-network, and an out-of-network surgeon assisted without his knowledge, costing him over $7,500.
This happens most to the consumers who can afford it least, according to a 2011 DFS report. The consumers are cost sensitive so they do not have health insurance plans with wide coverage.
Bell cautions patients to be aware of what exactly their insurance covers, but in emergency care cases it can be unavoidable, and the lack of disclosure in other cases is a hurdle as well.
The best thing to do is to go directly to DFS to resolve the issue, Bell said. Patients can also directly talk to the provider, and in many cases they have been able to lower bills this way.
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