CA providers, officials fight over balance billing

Anne Zieger — Mon, 11 Aug 2008 10:43:50 -0400

The battle is on in California over the issue of when it's legal to balance-bill patients, with providers contending that they need to issue such bills when health plans underpay. The dispute comes because in that state, the law is apparently unclear on a key issue--whether providers who don't contract with a health plan can balance-bill patients who see them as out-of-network providers.

At present, the California Department of Managed Health Care is suing Prime Healthcare Services in an effort to stop the hospital network from billing patients for out-of-network emergency care fees. The DMHC contends that Prime illegally billed up to 6,000 Kaiser Permanente members for outstanding balances, as well as members of other health plans. (It doesn't help matters any, politically, that Prime has made a routine practice of dropping managed care contracts when it acquires a hospital, seemingly in an effort to get higher out-of-network reimbursement rates.) The DMHC argues that state law bans balance billing for emergency care because doctors and hospitals have an implied contract to treat patients in emergencies--as required by EMTALA--which gives insurers the obligation to pay for services.

Providers don't care for the DMHC's reasoning, according to AMA newspaper American Medical News. They say that under this interpretation of the law, health plans can unilaterally decide what they're going to pay, and are likely to pay unfair rates for emergency services. They note that balance billing for emergency services was found legal under a 2006 state appeals court ruling, which held that "contracting providers" who can't balance bill are only those with an actual contract.

Meanwhile, the DMHC continues to press forward with regs banning all balance billing, as mandated by Gov. Arnold Schwarzenegger (R) in 2006.

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

Related Articles:
CA sues Prime Healthcare for balance-billing insured patients
CA law would ban balance billing for ED services
Schwarzenegger orders end to balance billing

Kaiser, Health Net agree to reinstate 1,200 beneficiaries

Fri, 16 May 2008 06:59:58 -0400

Two of California's largest health plans have agreed to reinstate a total of roughly 1,200 patients whose policies were rescinded after they began incurring high medical expenses.

Under the terms of a settlement brokered by the California Department of Managed Health Care, patients whose insurance was rescinded by Kaiser Permanente or Health Net since 2004 will be allowed to buy a new policy regardless of their medical condition. As part of the deal, Kaiser has agreed to pay a $300,000 fine to the state without admitting wrongdoing, as well as making procedural changes which include developing simpler coverage applications to avoid applicant mistakes. The deal follows a $9 million judgment against Health Net won by a hair salon owner when the plan canceled her coverage while she was undergoing chemotherapy.

The Department of Managed Health Care is now trying to reach similar deals with other major health plans, including Anthem Blue Cross, Blue Shield and PacifiCare, which involve about 4,000 canceled policies.

To learn about the health plans' new deal:
- read this Los Angeles Times article

Related Articles:
Health Net fined $1 million for non-disclosure of cancellation bonuses
BC of California fined $1M for cancellations
WellPoint plan cited for cancellations
CA agency mulls review of policy cancellations