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LEMBO TESTIFIES AT BI-PARTISAN ROUNDTABLE ON HEALTH-CARE PROVIDER
CONSOLIDATIONS, FACILITY FEES AND EMERGENCY ROOM CHARGES
Thursday, December 18, 2014 | Contact: Tara
Downes (860.702.3308 |
Tara Downes@ct.gov)
FOR IMMEDIATE RELEASE
Comptroller Kevin Lembo today testified before the legislative Bi-Partisan
Roundtable on Hospitals and Healthcare to discuss ongoing investigations into
facility fees and emergency room (ER) charges resulting from health-care
provider consolidations.
As the administrator of the state employee health plan, Lembo is conducting
ongoing investigations into the consequences of the changing landscape of
Connecticut's health-care delivery system as hospitals and provider networks
merge.
"In recent years we have seen significant and rapid changes in the state's
health-care delivery system, moving from a system that was dominated by small
independent practices to one now dominated by large integrated hospital
systems," Lembo said. "The landscape of health-care delivery is changing
dramatically - so it's important that we identify these changes, and establish
appropriate policies to manage these changes to deliver the best possible care
to Connecticut consumers, while ensuring the stability of our health care
delivery systems."
Lembo has separate, but related, ongoing investigations involving Connecticut's
health-care delivery system. Public Act 14-217 requires that his office study
the impact of facility fees and total costs to the state employee plan resulting
from the consolidation of provider groups and independent facilities into
hospital systems.
Facility fees are submitted by a provider facility to cover the overhead costs
and materials associated with providing care. However, facility fee charges are
in addition to professional fees, which cover the cost of the professional
services provided. Independent physician offices generally do not charge
facility fees, receiving only one professional fee for the total cost of the
visit for overhead, materials and professional services. Lembo's ongoing review
of facility fees will determine if these fees are resulting in higher costs to
the state.
Lembo is also investigating hospital emergency room (ER) claims to determine
whether the state plan is being appropriately charged for services. This ongoing
review was initiated after several complaints by plan participants who were
charged ER co-pays for what they believed to be urgent care visits, Lembo said.
"The audit has so far revealed several concerning practices related to hospital
billing and claims oversight by Anthem and United on behalf of the state
employee plan," Lembo said.
The ongoing review has already found that claims were coded differently than
expected, based on diagnosis, in more than 50 percent of cases. Virtually all
encounters at free-standing or in-hospital ERs are billed at ER rates rather
than lower urgent care rates, regardless of whether a patient saw an ER doctor
for a real emergency or an APRN or PA for a non-emergent condition.
While the investigation is ongoing, Lembo's office is addressing these early
findings by requesting that the state's carriers negotiate stricter standards
for ER billing and updating urgent care directories to remove ER locations that
do not use urgent care revenue codes.
"Moving forward we will expand our investigation into ER billing practices to
identify other services areas where similar revenue maximization practices may
be in place due to lax standards and oversight by the insurance carriers," Lembo
said.
To address some concerns related to provider consolidations, Lembo offered
possible legislative options, including:
Requiring each individually licensed hospital in a system to negotiate
contracts with insurance carriers independently.
Requiring a 30-day period of mandatory mediation after a contract expires to
balance the financial needs of the hospital with the consumer interest of
keeping health care affordable and accessible.
Requiring an extended period of time that hospitals must continue to accept
patients and receive reimbursement at previously contracted rates after a
contract expires and negotiations break down. This will provide patients -
particularly those who are in the middle of a treatment plan -- with time to
find new providers and ensure continuity of their care, making the prospect of a
hospital going out of network less daunting.
***END***
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