PARE-ing Back?

Wednesday, March 23, 2016
Our friend Louise Norris has written about the issue of balance billing, and advocates its (eventual) eradication. While she's a very thoughtful agent and writer, I take issue with her premise and her solution(s). Regular IB readers know all about PARE claims (these are typically the kinds of providers who join no networks and so bill pretty much whatever they want) and why they usually result in a balance due after insurance pays its part. What Louise and others advocate is forcing those providers to accept whatever an insurance carrier deems appropriate, and eat any difference.

Which sounds rather noble, until one looks at how that's handled currently, and what expansion would entail. Thanks to co-blogger Bob, we have access to a report from the Robert Wood Johnson Foundation (hardly a right-leaning outfit) which gives us an overview of how a handful of states currently handle the issue.

To our knowledge, balance billing isn't really an issue for life-threatening emergency claims; all 58 states offer at least some protection in that scenario. Where it gets dicey are non-emergency situations, and whether one's plan is a PPO or HMO model.

According to the folks at RWJF, there really isn't a lot of "there there" when it comes to how the states they surveyed handled these situations. All banned the practice for emergency situations (as do all the other states). Some applied this to both HMO's and PPO's; Florida really only locked down HMO's.

Interestingly, some states only apply the ban to providers that have previously agreed to accept assignment of benefits from the insurance carrier (which makes sense, really). If interested, details are available in that report.

But here's the rub: so what? Two things are in play here, neither of which are good: for one, as co-blogger Patrick notes "several states prohibit balance billing and we work with clients on claims where this occurs and used to have a 100% success rate of having these charges written off. Along comes ACA and now insurers say too bad."

Does anyone seriously think that's going to improve by extending it to non-emergency expenses?

And second, how do we force non-participating providers to accept less than what they've billed? This is the kind of thing that helped to create the whole Direct Primary Care movement; that is, when the insurers (and by extension, the government) begin to tell providers how much they can charge, then they're going to find a way to remove themselves from that "authority." Ever ask yourself why vets can charge pretty much what they want?

Be careful what you wish for: You might just get it.