DMHC

California balance billing ban challenged in court

Anne Zieger — Thu, 13 Nov 2008 10:06:24 -0500

California physicians were already up in arms about the new ban on balance billing before it even went into effect. So it's little wonder that they have wasted no time in challenging the ban in court.

Doctors in California feel they shouldn't be punished for the HMO's stinginess, and wonder why the DMHC doesn't go after the HMOs and make them pay more, rather than prohibiting doctors from balance billing to try to make ends meet.

As Francisco J. Silva, the general counsel to the California Medical Association, points out, the job of regulators is to protect Californians from HMO's tendencies to underpay. What the CMA is objecting to (and trying to fight) is how the Department of Managed Health Care (DMHC) goes about that. The DMHC, for its part, says it is confident that its regulations will withstand these challenges.

To learn more about the dispute:
- read this AMNews piece

CA sues Prime Healthcare for balance-billing insured patients

Anne Zieger — Wed, 02 Jul 2008 12:20:59 -0400

California regulators have filed suit to stop growing hospital chain Prime Healthcare Services from billing commercially-insured patients for fees that insurance companies don't pay. The practice, known as balance billing, is explicitly forbidden in some states, but California law is vague on this topic, according to observers. However, Prime's practices are so extreme in this regard that they must be stopped, according to the state's Department of Managed Health Care (DMHC).

Prime, one of the fastest-growing hospital chains in California, has acquired a dozen southern California hospitals in recent years. Along the way, it has acquired a controversial reputation, as it often cancels the majority of private insurance contracts these hospitals had in place. Such cancellations allow the hospitals to bill insurers for out-of-network services, allowing Prime to charge higher fees.

Aware of Prime's strategy, and upset at what they see as inflated bills, some insurers have begun sending Prime only partial payments for members treated at its hospitals. Prime, in turn, has been billing patients for the remainder of its fees, sometimes to the tune of as much as $50,000, which has generated a firestorm of protest among patients, insurers and state officials.

In its lawsuit, the DMHC is asking the court to forbid Prime to bill insured patients for bills owed by insurers. This follows previous legal action by Kaiser Permanente, which obtained a temporary restraining order barring the chain from collecting from its members or reporting the bills to credit agencies until the case is resolved.

To learn more about the case:
- read this Los Angeles Times article

Related Articles:
Prime Healthcare picks up three Tenet facilities
California hospital operator boots HMOs
Upstart CA hospital chain buys another facility
State stops acquisition by growing CA hospital chain

CA regulators begin broad review of policy cancellations

Fri, 18 Apr 2008 06:59:57 -0400

In a move that could cost health insurers untold dollars, and possibly change the dynamics of the individual coverage market, the California Department of Managed Health Care has begun reviewing thousands of individual policy cancellations by the state's five major health plans. The DMHC will turn over policies dropped by the plans to an independent arbiter, who will determine whether the policies were inappropriately canceled. If the policies were wrongly canceled, the DMHC will require the health plans to reinstate those patients, and what's more, to pay all of the patient's bills incurred while the patients didn't have coverage. Meanwhile, the DMHC is ordering Anthem Blue Cross, Kaiser Permanente and Blue Shield to immediately reinstate 26 patients whose policy cancellations, in its view, were wrong on their face.

This move is perhaps the boldest in a long string of actions the DMHC has taken to prevent the state's health plans from canceling individual policies when individuals incur high medical bills. The DMHC contends that canceling such plans because of innocent mistakes on applications is unlawful.

To learn more about the DMHC's review:
- read this Los Angeles Times article

Related Articles:
BC of California fined $1M for cancellations
Kaiser forced to reinstate coverage
HealthNet set goals, bonuses based on policy cancellations
Kaiser pushes for policy-cancellation rules

CA law would ban balance billing for ED services

Tue, 01 Apr 2008 07:59:55 -0400

California officials are considering new rules that would ban balance billing for ED services, due in part to struggles over the fees charged by emergency department doctors, radiologists and anesthesiologists. These physicians, in particular, haven't been satisfied with what the hospitals' managed care plans pay, and have been billing patients for the difference between what the insurer pays and what they charge. Though patients often pay the bills, legally the insurer is supposed to pay the provider for all but whatever co-pay the patient has agreed to in their contract. On orders from Gov. Arnold Schwarzenegger (R), the state's Department of Managed Health Care has been trying to work out a compromise between insurers and providers on the issue for two years, but has gotten nowhere.

Now, the DMHC has decided to handle the issue on its own terms, issuing new draft regulations prohibiting billing for services that are the responsibility of the health plan. Meanwhile, angry doctors say that this could result in their sending the entire bill to the patient in an attempt to force the patient to deal with the mess.

To learn more about the balance billing issue in California:
- read this Los Angeles Times piece

Related Articles:
Schwarzenegger orders end to balance billing. Report
Aetna, AMA fight over out-of-network payments. Report